Ed Zittrain

I think basically every AI startup is unprofitable at its core, and there is nothing that's going to shift these economics in their favor.

There is no sign that inference is becoming cheaper.

There is no sign that anyone has any plan to do so, and neither Anthropic nor OpenAI seem particularly concerned with bringing those costs down.

Which ones specifically?

Just because Amazon Web Services was profitable in nine years, the total capex between 2002 and 2017 was $52 billion.

And that was for all of Amazon.

just not just AWS, between 2002 and 2017.

If we're talking about the dot-com bubble, the dot-com bubble's economics were actually fundamentally different.

Fiber was much cheaper and also had more uses, more obvious uses.

Let me put it really simply.

I know what you're getting at, but let's put it really simply.

But Amazon was also not just a cloud company.

compute company it was a basically went from a bookstore to a store to a cloud compute company added totally different business right yes yes the point i'm making is the way this is being invested in doesn't have the recovery story from the dot-com bubble

Because with the dot-com bubble, the dark fiber that was laid and the interchanges and the various bits of lucent telecom stuff that was left abandoned, it didn't cost a ton of money to operationalize it.

And its running costs were not incredibly expensive.

If data centers end up not being built, it's going to cost just as much money to finish them in 10 years as it will today.

And then on top of it, electricity costs are likely to be more in the future, not less.

And there will be less customers.

I understand where people get this from.

It's just difficult to square with me.