China just made the model a commodity. Satya Nadella saw it coming, Apple bet the company on it—and the bill lands on people who were never in the room. Us.
Lawrence, this is the most fascinating and intelligently informed take I have read on the state of AI, our culture, and the forces currently rochambeaux-ing for our future. We’ve all felt in our bones that the center cannot hold. The Chinese commoditization surprise combined with the growing political unrest over the environmental toll of data centers have fundamentally altered the battlefield. It’s going to be a hell of a war. Looking even further into the future, I will tell you that my 16-year-old son and his generation absolutely detest how AI has stolen from them before they had anything to steal. That is going to come back to bite the industry and society as a whole in the ass, for sure. Side note: After 11 years at Servicenow, I joined you in the late-stage capitalism unemployment line about two months ago. I am in amazing company!
Thanks, E.G. I appreciate that. I was up late last night making sure that I had the facts right. I feel like this is too important, and we have to understand what's happening.
Lawrence, I am 72 and can’t come close to fully grasping what you wrote. But I think it sounds like the AI oligarchs are in it for more than they’ll get from it. My first thought is sweet revenge, but then “too big to fail” comes to mind and I’ll bet the public ends up holding the bill. Their gigantic “data centers” (our data, that is) are polluting with impunity. I am sick of these oligarchs running our country. They are fucking everyone over. I don’t blame the younger generation who are pissed at these people. Your essay was amazing and you are so smart! I admire your brains and your writing skills!
Thanks, Elizabeth. I appreciate that so much. I'm trying to write it so that more people can understand what's going on. I know there are a lot of new terms and big concepts, but you've got the key bit. It looks like the AI tech bros bet on a particular outcome that is not going to happen, and it seems like China is intentionally making sure that it doesn't go their way. Whatever that means for us, it's got to be bad news, so brace yourself. We're all in this together.
I've never been able to comprehend what the actual value to society as a whole AI provides. It feels like it Is being imposed on us against our will without us being told what the problem is that it actually fixes.
It is also extremely expensive, and the data centers pose a tremendous environmental cost, especially to those who lived closest to them.
So what is AI about? What positive value does it add to our lives?
Stephen, AI learns by consuming massive amounts of information, and mapping all of the relationships between those pieces of information. It's a bit like if you studied for your AP math test by studying every AP math test ever published, and then mapped all the relationships to every question to every other, and then abstracted them out so that you could not only answer any question about math, you could write valid AP math questions at a whim. The "frontier" (cutting edge) AI models can do this at a scale and speed that boggles the human mind. Now add onto it that same thing for every other subject matter. And then onto that, the idea that we can teach it so much that it can start to reason and think in ways that we would be able to recognize as "general" intelligence.
Amazing read. As expected, you melted my brain a little - in a good way. Thank you for laying this out in such a structured way.
I see a number of smaller SaaS companies (still enterprise level, just not the big players) using a hybrid model, with their own proprietary LLM sitting directly underneath the software as the user-facing layer, and in the back-end their model draws on multiple AI providers at once. Technically agnostic, never dependent on just one provider. It'll be interesting to see how that model plays out.
Exactly that, Courtney. Those companies in the model I describe would be called layerers, and they're making the bet that they can be model agnostic. They'd be ideal candidates for Kimi K3. If China truly releases the model for free, then they've got zero cost in building a highly effective LLM model. All they would need to do is deploy it to their own servers and customize it in whatever way was necessary for their purposes. That has the potential to change everything.
Lawrence, this is the most fascinating and intelligently informed take I have read on the state of AI, our culture, and the forces currently rochambeaux-ing for our future. We’ve all felt in our bones that the center cannot hold. The Chinese commoditization surprise combined with the growing political unrest over the environmental toll of data centers have fundamentally altered the battlefield. It’s going to be a hell of a war. Looking even further into the future, I will tell you that my 16-year-old son and his generation absolutely detest how AI has stolen from them before they had anything to steal. That is going to come back to bite the industry and society as a whole in the ass, for sure. Side note: After 11 years at Servicenow, I joined you in the late-stage capitalism unemployment line about two months ago. I am in amazing company!
The attention to detail and comprehensiveness of your article is impressive and massively educational.
Thanks, E.G. I appreciate that. I was up late last night making sure that I had the facts right. I feel like this is too important, and we have to understand what's happening.
Lawrence, I am 72 and can’t come close to fully grasping what you wrote. But I think it sounds like the AI oligarchs are in it for more than they’ll get from it. My first thought is sweet revenge, but then “too big to fail” comes to mind and I’ll bet the public ends up holding the bill. Their gigantic “data centers” (our data, that is) are polluting with impunity. I am sick of these oligarchs running our country. They are fucking everyone over. I don’t blame the younger generation who are pissed at these people. Your essay was amazing and you are so smart! I admire your brains and your writing skills!
Thanks, Elizabeth. I appreciate that so much. I'm trying to write it so that more people can understand what's going on. I know there are a lot of new terms and big concepts, but you've got the key bit. It looks like the AI tech bros bet on a particular outcome that is not going to happen, and it seems like China is intentionally making sure that it doesn't go their way. Whatever that means for us, it's got to be bad news, so brace yourself. We're all in this together.
I've never been able to comprehend what the actual value to society as a whole AI provides. It feels like it Is being imposed on us against our will without us being told what the problem is that it actually fixes.
It is also extremely expensive, and the data centers pose a tremendous environmental cost, especially to those who lived closest to them.
So what is AI about? What positive value does it add to our lives?
Stephen, AI learns by consuming massive amounts of information, and mapping all of the relationships between those pieces of information. It's a bit like if you studied for your AP math test by studying every AP math test ever published, and then mapped all the relationships to every question to every other, and then abstracted them out so that you could not only answer any question about math, you could write valid AP math questions at a whim. The "frontier" (cutting edge) AI models can do this at a scale and speed that boggles the human mind. Now add onto it that same thing for every other subject matter. And then onto that, the idea that we can teach it so much that it can start to reason and think in ways that we would be able to recognize as "general" intelligence.
Amazing read. As expected, you melted my brain a little - in a good way. Thank you for laying this out in such a structured way.
I see a number of smaller SaaS companies (still enterprise level, just not the big players) using a hybrid model, with their own proprietary LLM sitting directly underneath the software as the user-facing layer, and in the back-end their model draws on multiple AI providers at once. Technically agnostic, never dependent on just one provider. It'll be interesting to see how that model plays out.
Exactly that, Courtney. Those companies in the model I describe would be called layerers, and they're making the bet that they can be model agnostic. They'd be ideal candidates for Kimi K3. If China truly releases the model for free, then they've got zero cost in building a highly effective LLM model. All they would need to do is deploy it to their own servers and customize it in whatever way was necessary for their purposes. That has the potential to change everything.
Indeed it does. The adoption vs. regulation race will be fascinating to see...