Comment by wmeredith
17 days ago
"SpaceX told investors during the IPO process that it sees an addressable market for AI products worth $26 trillion, roughly equivalent to U.S. GDP."
This is unhinged.
17 days ago
"SpaceX told investors during the IPO process that it sees an addressable market for AI products worth $26 trillion, roughly equivalent to U.S. GDP."
This is unhinged.
I know it has become a meme by now, but IIRC the market for all foods (agriculture, processed food, etc.) on earth is around $10 trillion.
So according to SpaceX, the market for AI is 2.5 larger than all the food sold on this planet.
They're also saying that the AI market is worth roughly 10% of all global real estate.
This is true if you take the ai market as equal to the market for labor discounted to 5-10% penetration.
It’s not a totally unreasonable assertion, it’s the implication of the assertion that we are uncomfortable with. There is no reason for the models to stop their improvements in the near future.
> There is no reason for the models to stop their improvements in the near future.
Sure there is.
1. The cost of each new generation of training runs appears to be rapidly rising
2. The Trump admin just told the leading model to stop making it available to non-Americans, which in practice meant stop providing it at all
3. The factories to make the hardware are hitting bottlenecks, and while they've currently been navigated around, there's never a guarantee the next one will be
Currently I'm wondering at what point the direct impact on the US energy supply gives the US a taste of Baumol's cost disease as AI companies continue to outbid everyone else for electricity.
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> There is no reason for the models to stop their improvements in the near future.
You speak as if "improvements to models" is just function of time, and resources are infinite.
Models keep improving as long as there are resources to allow for larger and larger datacenters, if we hit a scientific breakthrough once LLM technology become the bottleneck, if the economy is infinite to allow infinite growth, and (geo)politics is not a thing to worry about. Or we discover ASI, machine improve themselves and we reach the technological singularity.
I know everybody is drinking the kool aid by the gallon, but can we maintain a little bit of objectivity?
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> the market for AI is 2.5 larger than all the food sold on this planet.
It just shows how much the automation has impacted agriculture and the food industry. Sure, there're rural farms that apply 200 yo technology. But e.g. the grain production and farming are incredibly efficient at scale. So, it's not that costly for as a humanity to feed 8 billion people (at a varying level, of course).
Remove 20% of AI supply, and the world goes on like nothing happened.
Remove 20% of food supply, and watch prices explode, global unrest, and famine take place.
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You can't food maxx a trillion calories a day to generate a multi million dollar bill. You can token maxx it though.
I think the issue is the reality that most life is worth a lot less (in US Freedom units) than some software running doing absolutely nothing truly valuable for anyone.
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What precisely is the moat surrounding AI that SpaceX is using to justify this kind of spending spree? I don't how SpaceX and other AI companies will be able to keep the weights of their AI models private in the face of interest by virtually everyone in the world. It would be absolutely trivial for a nation state to walk into a data center using a state issued security certificate to seize a few of the physical servers running the cloud services of OpenAI / Grok / Claude. Copying the weights is trivial. Infiltrating a company with spies as new hire coders to gain access to source code is also trivial.
This is really starting to feel like the pets.com era again.
Because there's nowhere else for the money to go, the money must go to AI.
There are no growth opportunities in any other industry (except healthcare due to disastrous demographics), where else are people going to invest?
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Cursor is a harness that can be used with all kinds of models. It's a much better harness than anyone else's and takes the company out of just playing the model game.
Exactly this. I think valuations and the AI market could get stirred up if:
- We get an open source Opus 4.8 equivalent and pair it with an open source coding agent
- Running this OS stack becomes cheaper than what frontier model providers charge (see OS model prices on OpenRouter vs. frontier lab prices)
- This happens across verticals (i.e. not just software)
The first “DeepSeek moment” didn’t do much damage back in the days, but I wouldn’t be surprised if a similar moment becomes a lasting, effective, cheaper alternative.
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They are a distant third at best, at least in trading companies. If you look at Chinese and other likely national actors, they are probably further down.
The thing with dotComs is that they didn't have THIS level of unsustainable financing burn, and a tangible issue of token processing cost that has no magic wand coming with the current practical limits of Moore's law.
> I don't how SpaceX and other AI companies will be able to keep the weights of their AI models private
That is an interesting point. If there are higher concerns, copyright law is easily ignored, and only one person needs to get access to the data once.
SpaceX is good at building data centers in tough regulatory environments, in a way that other players have been unable to match
To be fair, food is the smallest bucket of my monthly expenses. And there are many people here on hacker news who pay more for their AI tokens than for their food.
How does argrar industry and tech industry compare as share of gdp in the US?
You are not in any way the average person.
Food is the 3rd largest expenditure in most households, after housing and transportation.
I'm sure people laughed in 2023 if someone said AI will reach $100B in revenue in 3 years. Yet here we are
Oh, that puts it 0.3% of the way there! And all it cost was increasing prices until every customer started talking about cutting it.
Past performance is not guarantee of future returns.
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“ai-x”? Elon? You know that you are not allowed to in this forum. It’s only for adults. Go back to Twitter and play with the other kids.
Food is worth a lot more than that. If the alternative was starvation, we would pay approximately all the money for food. By that metric food is worth more than $100T. The difference between $100T and $10T is called the consumer surplus, one of the largest benefits of a free market economy.
AI might eventually provide $26T worth of value, but if it captures anywhere close to that amount of revenue that'll indicate a failure of the free market economy. Competition and open source will have failed and the oligarchy has won.
(Either that, or inflation will have made $26T a relatively smaller number).
> They're also saying that the AI market is worth roughly 10% of all global real estate.
Why limit yourself to one planet? Space is infinite ;-)
I'm sure the finance market is much larger as well
>> AI products worth $26 trillion, roughly equivalent to U.S. GDP."
> This is unhinged.
The only way for Musk to become a quadrillionaire is hyperinflation. And a week later, we'll be quadrillionaires too!
Be honest now, it would take at least a few months for the rest of us.
Always fun to remember when calculating TAM - something like 85 - 90% of the world earns less than $1000 usd per month.
The math don’t math here, there literally aren’t enough people to afford this and businesses will go under the more people are displaced for gainful employment.
There have been a few recent stories about businesses finding themselves spending more on tokens than they were spending on the workers these AI Agents were supposed to have replaced.
Marks believe anything the con tells them as long as it's promising big money ROI.
You need to understand the definition of “total addressable market.” It’s a maximum theoretical number for the size of the market (not your company’s revenue) under ideal assumptions. A $26 trillion TAM is high but it’s not “unhinged.” For example, the logistics and transportation market is over $10 trillion and expected to double by 2035. Under ideal assumptions, if AI replaces everything from coders to lawyers, why is that “unhinged?”
Over what period of time?
By 2030? No way
By 2050? Maybe?
Obviously during an IPO you’re trying to make the bull case (unhinged or not). What does it look like in the best case scenario.
I also saw a quote from Musk saying that he expects SpaceX to hit $1 trillion in revenue by 2031. Given his track record of predicting performance I think it's safe to ignore such future looking statements from him or companies he controls.
Another way of putting this: global GDP is ~$132Trillion from what I gather.
So this is saying AI products will increase global GDP by about 20%.
The Federal Reserve says AI is contributing about 1% GDP growth per year to the US [0].
So maybe you can get to $13 trillion over a decade just from that. If you assume some acceleration, 20% isn't out of the question.
It is an extremely rosy projection, but if AI can replicate large fractions of the workforce, leaving those humans with the ability to work on other things, it doesn't seem unhinged when you think of it through this lens, just very optimistic - not Elon Musk level optimistic, just "everything goes according to plan and a bunch of things in the causal chain are all slightly on the higher end."
[0] https://www.stlouisfed.org/on-the-economy/2026/jan/tracking-...
> So this is saying AI products will increase global GDP by about 20%.
No business gets to capture 100% of the value it produces without physical coercion.
For infrastructure that requires high investment, it usually captures something around 5% of it. People tend to work really hard to replace or reduce any kind of infrastructure that gets near 10%. So we are talking about AIs increasing the global GDP by 200% at minimum, 400% more realistically.
Or in other words, bullshit number is bullshit.
> sees an addressable market for AI products
Well if you start adding AI powered to "everything" then it is possible.
Soon you'll have AI face cream and AI donuts.
I call it forward thinking: they assume massive inflation due to income taxes breaking away.
> This is unhinged.
Just like the investors :D
Where is that quote from?
I can’t see it in the article when reading on my phone?
Dunno the actual number, but one thing I'm certain is that it must be closer to $0 than $26 trillion on a number scale.
yea, totally nuts.
clearly it's more like $540.2 quintillion at this point
They are pricing in inflation along with the inevitable money printing that will happen.
In a sensible world, this would be considered lying to investors and be prosecuted.
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With SPCX shares never going down in price, SpaceX can acquire all companies in the US in exchange for its stock, so SpaceX itself is worth at least as much as the US GDP! (/s)
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