Comment by dmix
10 days ago
I'm paying for 3 different AI services and our company and most of my team is also paying money for various AI stuff. Sounds like a real industry to me. There's just going to be VC losers as always, where usually "losing" is getting bought by a bigger company or aquihires instead of 100xing or going public.
My team is doing the same, and yet all of us still aren't sure that we're actually more productive overall.
If anything it seems to me like we've just swapped coding with what is effectively a lot more code review (of whatever the LLM spits out), at the cost of also losing that long term understanding of a block of code that actually comes from writing it yourself (let's not pretend that a reviewer has the same depth of understanding of a piece of code as an author).
If you work in a team then you are likely already not writing most of the code yourself.
There will be point where ai will consistently write better prs - you can already start to see it here and there - finding and fixing bugs in existing code, refactoring, writing tests, writing and updating documentation and prototyping are some examples of areas where it often surpasses human contribution.
All the comments of AI writing code and making PRs remind me a lot of all the promises about self driving cars. That was more than 10 years ago and today I still don't know anybody that has a car that drives itself. Will AI write useful PRs one day? Probably. Will it do that before I retire or die of old age? Considering I have been using agents for about a year or so, and seen little to no improvement in that time, I'm afraid the current version of AI probably has already peaked and we'll only see marginal improvement due to diminishing returns.
Yes there is a very real trade off between labour and capital.
In the past the tradeoff has been very straight forward. But this is a unique situation because it involves knowledge and not just the physicality of the human in regards to productivity.
Those companies are also likely still in the red. They're banking on the hope that one day they will be profitable. I'm sure one of them will be.
HN said the same thing about Uber forever.
Uber didn't invent anything, they drove taxis out of business then jacked up the prices, squeezed the workers, and now everybody is riding around in regular people's crappy cars for more than a cab cost. And now I need a phone and to maintain my relationship with these two crappy companies rather than to wave at the street (which is what I used to do to get a ride.)
That was literally what everybody said would happen.
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For almost 20 year, Amazon has been the poster child of "A company can be unprofitable for years and still turn out a winner", but of course - not all companies can pivot from being a regular e-commerce company to cloud infrastructure/hosting, and become a money machine.
So the question, at least to me, is how these AI companies will find a product or service that makes them profitable. Other than becoming actual monopolies in their current domains.
Uber sold something like $50 billion in equity and debt before it went public, and although they're profitable now, to me it doesn't seem like they have answer to Waymo coming up fast in the rear-view mirror. I think Uber is still a scam, just one where the earlier investors fleeced the later ones who are never going to see the returns they paid for.
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> 3 different AI services
Why three? Will you ever be in a position where one will do it for you?
> and most of my team is also paying money for various AI stuff.
And what are they using it for?
> Sounds like a real industry to me.
Sounds like early adopter syndrome to me. We'd have to know more about your business to take this out of the realm of hazy anecdotes.
> Why three? Will you ever be in a position where one will do it for you?
I believe LLMs will be niche tools like databases, you pay for the product not 'gpt' vs 'claude'. You choose the right tool for the job.
I have a feeling coding tool with be separate a niche like Cursor, which LLM it uses doesn't matter. It's the integration, guard rails, prompt seeding, and general software stuff like autocomplete and managing long todos.
Then I pay for ChatGPT because that's my "personal" chat LLM that knows me and knows how I like curt short responses for my dumb questions.
Finally I pay for https://www.warp.dev/terminal as a terminal which replaced Kitty terminal on macos (don't use it for coding) which is another niche. Cursor could enter that arena but VSCode terminal is kinda limited for day-to-day stuff given it's hidden in an larger IDE. Maybe a pure CLI tool will do both better.
The problem is the hype machine that is claiming it will replace human labor which justifies the insane losses.
These companies are burning cash to support the current formulation of AI services.
These services will survive because they are useful but probably not at its current cost
are you paying them enough to have profitable unit economics? How hard would it be for you to switch from one provider to another?
there's some lock-in for both chatgpt (the history and natural chat personalization feature is super useful) and with Cursor I'm fully invested in the IDE experience.
The lie is that LLMs are the product itself rather than the endless integration opportunities via APIs and online services.
A real industry can be a bubble too. Not every bubble looks like tulips.
For example:
- Dotcom bubble. Of course making website was and is a real industry.
- Japanese real estate bubble. Of course building houses was and still is a real industry. It's so real people call it real estate, right.