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[–] 327 points 4 months ago (37 children)

an astonishing 29 percent of [execs] had no idea where the growing costs associated with AI were coming from.

The headline combined with the quote just make me laugh so much, I love it

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  • [–] 223 points 4 months ago (31 children)

    This is what happens when the people in charge of everything are entirely separated from reality.

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  • [–] 158 points 4 months ago (29 children)

    Those same idiots have been in charge of everything for decades, blindly doing whatever suited them.

    They got duped and didn't have the technical competence to see it or trust their staff to negotiate it.

    Every IT / Developer out there knew it was a bad idea. The C-Staff was sold by the billionaires that you will go AI or you will be left behind.

    My own CEO is simultaneously telling us to use AI for as much as we can and telling us to reduce costs as much as possible.

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  • [–] 67 points 4 months ago (11 children)

    The "you'll be left behind" nonsense makes me laugh. Left behind from what exactly? Lol

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  • [–] 69 points 4 months ago (5 children)

    The sales pitch is:

    All your competition is going AI. They're be producing 10x the work with mouth breathing morons at the keys, while you're stuck paying millions to subject matter experts.

    They're scared ot death that the tenuous hold they have on their market segment will be severed if their competition outflanks them in this, so FUD wins.

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  • [–] 45 points 4 months ago* (last edited 4 months ago) (4 children)

    This isn't just in industry or tech. I work in the academy. You would be shocked how many people from administrators all the way on down truly believe this. That, without any proof, this technology is going to make everybody a billion times more productive and that any graduates who don't have this is a foundational skill will surely not survive in the future workforce.

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  • [–] 13 points 4 months ago (2 children)

    "it's technology and science, it must be good!"

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  • [–] 15 points 4 months ago

    Yeah, that isn't how this works. You don't want to be the one using the software while it's still in beta. Wait until the dust settles before committing to anything. Besides which the super-urgent "You have to buy now!" FOMO sales pitch is a classic strategy for scammers.

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  • [–] 3 points 4 months ago

    That's because they bought into the pitch that AI will replace employees (or at least large number of employees) they understand that they will still need to build tooling that would facilitate that and believe that once other companies will say they eliminated employees this way the companies that are "are left behind" will be stuck still needing employees that will catch up to this plan and refuse to help company to get there.

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  • [–] 54 points 4 months ago (8 children)

    I told my boss this:

    • Right now the AI race has a lot of similarities to the dotcom bubble. The subject is packed with risky loans based on huge debts. Those huge debts are expecting to be paid as AI becomes profitable, but AI companies are largely loosing money.
    • All those loans and infrastructure create the burden of sunk costs leading to a desperate need to succeed.
    • The people feeling that desperation are the same people who own the largest marketing, news, and social media networks in the world.
    • As a result, there’s a lot of hype around AI. A lot of “kool-aid,” and everyone wants you to drink it. If you drink the kool-aid, that means you’re also bought into the problem. You also need it to succeed, thus making their problem into your problem.

    I explained to him that mature, professional use of AI is going to wind up following a similar path to data engineering. It’ll start with bullshit standards, “prompt engineers” and the like, but eventually SE disciplines are going to define who makes best use of AI. You’re going to have niche use cases for daemon AIs, local LLMs, and remote models. You’ll have stronger frameworks around session management, context management, agent permissions, …

    It’s not going to be like this forever, “dump all your shit into our web upload and let the AI figure everything out in one go.” It’s going to become more fragmented, bounded, dare I say deterministic… orchestratable.

    Then I told my boss, it would be better if he could frame his excitement around these future use cases… so we can skip the kool-aid stage and get right into the good stuff.

    He agreed, until about a week passed. Then it was AI hype again.

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  • [–] 21 points 4 months ago

    The 3rd or 4th "industry expert" tells them that things are "moving fast" and things that were impossible months ago are now reality. It's designed to make them distrust their own subject-matter experts. They thing, ohh POTV, they're just not educated and up to speed.

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  • [–] 12 points 4 months ago (5 children)

    Yeah. Local LLM stuff is great when you want to shove a huge pile of documentation into a model trainer and make a more intelligent search. Two of my vendors have implemented it, and it's more useful than a traditional indexing search tool, though you do have to verify the results (which is not much more effort since with a search you'd have to skim the document to find the info it matched anyway).

    But for general "do everything" tool, yeah no. It can't read and understand your entire database, codebase, business process, etc.

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  • [–] 13 points 4 months ago* (4 children)

    Honestly, I’ve had a rather interesting experience with AI. I was very adverse to LLM usage at first. Later I sort of figured out that I was more adverse to the energy around AI than I am AI itself.

    I knew the models sucked at large tasks. Trying to get an edge on the matter though, I started asking myself, how can I get the model to perform better? I figured I could pass over the AI hate stage and get right into the AI professional stage… at least a head start.

    So I began experimenting with local LLMs, LLM harnesses, and various governance tools like jai. I decided against Claude Code and Cortex because they’re provider specific — instead using OpenCode so that I can use whichever model I desire. Then I began building out a SKILL.md repository for tightly scoped tasks like change-review, security-analysis, refactor, architecture-review, grill-me, feature-design, …

    I’m still thinking through some of the project needs. I want something that lets an agent work, while treating the agent as a kind of helpful adversary. You should be able to configure workloads that designate models, context, available tooling, skills, permissions, session length, inference level, acceptance criteria, and human-review stages. It would also allow for session switching, model switching, agent deliverable handoff to another agent, … not to mention, your VCS should know and respond appropriately if an agent ever pushes code. Don’t trust it by default.

    These workloads should be version controllable, benchmarked, …

    Anyway, a lot of that is speculative. Just where I’m at now, controlling context and skills manually, I’m already seeing much better results.

    And no, I don’t have the AI do everything. I just find smarter ways to decompose “everything” into much smaller tasks that are easier to review and scrutinize.

    But also, I push for local model usage in my organization. I don’t want my success to mean success for the AI companies. Fuck the AI companies.

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  • [–] 7 points 4 months ago

    I was forced to dogfood it. I found that for my specific needs, it made me super productive. I generally make Claude write Ansible jobs, I store all my secrets in a vault that it never gets access to.

    It can do tremendous amounts of work at my command in relative safety as long as i provide it protected tools.

    Now, that said, I burn a hell of a lot of tokens moving at that speed. When the ass falls out of the market, i'll still have all the ancible stuff I can reuse.

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  • [–] 6 points 4 months ago (2 children)

    Neither Claude code neither codex is actually vendor specific, they just don't tell you that you can config other providers, including local

    However opencode is pretty nice too, so if you like it, use that. I personally find that opencode with GLM 5.2 or Kimi K2.7 isn't actually that great, it'll hallucinate more than Claude code or Codex with their respective first party models. I think it's the models themselves rather than opencode itself though, as when I use GPT for planning and hand it off to deepseek flash to do the actual work, it's more or less fine.

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  • [–] 5 points 4 months ago (1 child)

    I suspect behind the scenes, the first parties are sending your requests to multiple targets and sending you back quorum.

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  • [–] 4 points 4 months ago

    Not impossible, but also the thinking process reduces the need for something like that. Anything in the context gets regurgitated back and forth multiple times so the model has multiple opportunities to flag something as being weird.

    Incidentally if you actually want to do something like that yourself, I believe OpenRouter has a feature for that. But of course it means you can essentially add up each model's costs and that's your new cost per prompt (not exact since output token count will differ, but on average).

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  • [–] 5 points 4 months ago (2 children)

    yep. these mba types have gutted half of id, and are changing id - ID - to unreal engine projects.

    fucking hell

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  • [–] 3 points 4 months ago (4 children)

    Except this time they'll have a hard time blaming the devs and other workers.

    I mean they'll sneak around it, but maybe just maybe the blame will not be distributed? Lol who am I kidding.

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  • [–] 27 points 4 months ago (3 children)

    And we hope they go broke, dont pay their bills, cause a panic sell on AI services, which causes private equity to panic sell everything... which pops the bubble... and leads to the literal version of 'its raining men' on wall street as executives and profiteers have their horde of ill gotten gains evaporate in seconds.

    ... too much?

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  • [–] 202 points 4 months ago (22 children)
    1. Build up reliance on AI, which looks really cheap
    2. You can now replace employees with AI so fire away!
    3. You are now completely dependent on AI and a handful of employees
    4. AI company sees they have you and start jacking up rates. If you could afford paying for people before then you have the $ to pay high rates.
    5. Company now wonders why costs are back to where they were before and the AI isn't working out as expected.
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  • [–] 152 points 4 months ago (10 children)

    It's particularly funny because I'm pretty sure AI companies are still selling the service below cost to try to retain market share (and drive small competitors out of business). They just aren't taking quite as big a loss on every token with the increased prices.

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  • [–] 27 points 4 months ago (1 child)

    Pretty much the model for so many internet services or streaming services.

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  • [–] 7 points 4 months ago

    Yeah. It certainly pays off sometimes. Amazon did it. It just, y'know, also crashes and burns sometimes, and I'm not sanguine about the way this is shifting its investment money from venture capitalists to, y'know, passive index fund investors.

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  • [–] 1 point 4 months ago (7 children)

    So, they're earning money on token generation but not overall (including training)?

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  • [–] 30 points 4 months ago (5 children)

    Openai had 2025 6billion in revenue and 20 billion costs on compute. So just to run the models to get 6billion they need to pay 20billion r&d and marketing etc get on top of that

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  • [–] 14 points 4 months ago (4 children)

    I’m sure there’s a term for it but this is like when a company keeps securing funding from investors so they keep growing to try to outpace costs with the illusion that you’re profitable when in reality you’re not. Just like WeWork.

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  • [–] 11 points 4 months ago (2 children)
  • [–] 9 points 4 months ago

    No, my understanding is that they're bringing in revenue on token generation, but it's exceeded by the costs of token generation (running data centers, so, electricity and cooling). They definitely want to make a profit on token generation, but they're afraid that raising costs that high too quickly would drive customers to switch to other providers. So they've reduced the amount they're subsidizing token costs, but not switched over to making a profit.

    I can't find a good citation for this, though, so it's possible I'm mistaken. They also have huge costs associated with buying new GPUs and building new datacenters, so they're operating at a massive loss either way, and it's a little hard to find articles which tease apart the two aspects.

    In any case, operating at a massive loss for the first few years is practically standard operating procedure in silicon valley at this point, and sometimes it eventually leads to a profitable, even wildly profitable, business (e.g. Amazon). But it does require a steady stream of investors and a steadily increasing market valuation. That's...we'll have to see what happens on that front.

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  • [–] 33 points 4 months ago (3 children)

    Yeah it’s basically the enshitification model

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  • [–] 19 points 4 months ago
    1. AI company hijacks your processes, trade secrets, and market to offer the same thing for cheaper than you can. Raises rates for competitors to cover its own token use and simultaneously drive the others out of business.
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  • [–] 9 points 4 months ago (2 children)
    1. They see people have gone to new companies thatre private unionized and value customers/employees/etc replacing them as they had done with their employees
    2. The company asks for them to come back to be laughed at as the people watch for them to slowly sink and be replaced with many better alternatives to take their place
    3. That is happening right now and we all can make it happen faster
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  • [–] 2 points 4 months ago (1 child)

    Have you heard about "Tokenmaxxing"?

    Since many AI companies didn't have a reasonable limit on the number of tokens for the amount of money you paid, companies started telling their employees to use as many tokens as possible. LLMs improve with more tokens (although there are diminishing returns).

    So users tried to exploit the 'lure offer', and AI companies had to change the billing. It's still below the real cost, but no longer this insanely expensive option.

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  • [–] 123 points 4 months ago

    The first hit was free.

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  • [–] 98 points 4 months ago (3 children)

    Someone should remind those soggy, arrogant execs that down here in the developer trenches we survived web services, software as a service, outsourcing, and off-shoring. We're still here after all that and we'll still be here after AI.

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  • [–] 27 points 4 months ago (2 children)

    Some of these people are so out of touch that they'd have to spend a decade in the trenches before they might even begin to get an inkling that something is up.

    Case in point: Bezos went to space and wasn't humbled by the overviewer effect because his ego is literally larger than the planet he lives on.

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  • [–] 87 points 4 months ago
    [–] 78 points 4 months ago (6 children)

    I swear, execs are some of the most gullible people on earth. I know some of them, and none of them are very bright, just very greedy.

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  • [–] 52 points 4 months ago (2 children)

    They're not selected for intelligence, but for sociopathy.

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  • [–] 8 points 4 months ago*

    And nepotism.

    And cronyism.

    Coming from the upper-middle and upper class and having attended the right schools and become mates with the right people is very highly correlated with becoming a top level executive.

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  • [–] 17 points 4 months ago

    My lesson in this came really early in my career. One of our execs was selling vapourware. Just promising our product, that we hadn't made yet, could do literally anything. Then he insisted we build it on this platform he must have had shares in the way he pushed it, only it was also vapourware and didn't do half the things it said it did.

    He found it utterly inconceivable that a company would sell a product that didn't do what it said despite doing the exact same thing himself. He was completely delusional.

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  • [–] 13 points 4 months ago

    As we've seen with Donald Trump and George W. Bush, if you're wealthy enough or in an aristocratic social group, you fail upwards.

    And if you always fail upwards, it's very easy to not gain the skills to succeed.

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  • [–] 67 points 4 months ago (11 children)

    Just wait until all the technical debt has to be paid as well.

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  • [–] 22 points 4 months ago (6 children)

    I know what you mean, but the tech debt problem will never get resolved.

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  • [–] 7 points 4 months ago (3 children)

    Of course but the cost can be mitigated. I've seen an AI built project and the outcome is that you pretty much have to continue using AI to continue development because it's borderline incomprehensible for humans. When AI fails to continue development you scrap the entire project and start from scratch.

    I imagine all companies that allowed AI to go wild in their codebase have a lot of components that need to be rebuilt from the ground up.

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  • [–] 3 points 4 months ago (2 children)

    In theory, completely rewriting legacy software with AI could be a great thing - doing so every 3 or 4 years, allowing newer and better AI to tackle the task, optimizing for every development made in technology or standards.

    However, this still requires human minds to define, guide, and verify these projects. AI opens up possibilities for better development, but executives seem determined to fritter away such potential by axing the human element.

    It is like a certain story...

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  • [–] 3 points 4 months ago*

    I don't know how much AIs can be useful on big ass projects, but it def was useful for me when i had to look at the code of a project i made 1 year ago, i was so much worse at writing code and it was such a mess that ultimately i used an AI agent to rewrite it
    Do i feel dirty? Yep
    Has it saved time? YES

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  • [–] 13 points 4 months ago* (1 child)

    The tech debt always gets paid one way or another. Either preemptively, as part of ongoing maintenance; or after a data breach in the subsequent lawsuit and settlement; or in the slow, inexorable trickle of increased infrastructure costs and lost business from slow dependencies and ineffectual bandaid solutions.

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  • [–] 14 points 4 months ago (2 children)

    I already see lots of boutique consultancies popping up specifically saying they will fix tour slop code bases. Developers and doctors will never run out of work.

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  • [–] 7 points 4 months ago (1 child)

    I'm not sure fixing it will be possible.

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  • [–] 12 points 4 months ago

    They will have to trash a bunch of it and rewrite entire modules and components from scratch.

    I’ve seen as AI keeps iterating over enhancements and bug fixes, the spaghetti code gets worse and worse over time. At some point only the AI understands its own code, as it is too much garbled nonsense for a human to trace through. Eventually that becomes too much garbage for the ai to trace through. And then that’s where you end up.

    The idea that this can be some kind of non-deterministic abstraction layer between pseudo code and actual code is absurd.

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  • [+] 64 points 4 months ago (5 children)
  • [–] 15 points 4 months ago (3 children)

    Well, we should automate everything that can be automated - for the benefit of everyone. Last part is something not seen on worldwide scale ever, just yet

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  • [+] 14 points 4 months ago (2 children)
  • [–] 6 points 4 months ago

    It happens every couple of decades with AI. Since it's a broader field than most people think, we have a pretty long cycle of a new development looking exciting, people getting way too excited and optimistic, the development being exactly what it was promised to be, and then people getting disappointed and avoiding anything with the AI label. Then we decide that because we're used to this new thing, it can be used in stuff as was originally appropriate but it no longer qualifies as AI, because "that's not AI, it's just ___".

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  • [–] 6 points 4 months ago

    The people who have never done the work love more than anyone else to talk about how the work should be done better and cheaper.

    Broadly this sentiment stands for most professions.

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  • [–] 56 points 4 months ago

    You'd think the cocaine-snorting classes would understand that only the first hit's free.

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