Join institutional investors, analysts and strategists from the world's largest banks: Subscribe today
Already have an account? log in
Weekly: The AI Spending Question
Now we're supposed to believe investors are newly skeptical of AI spending.
Just not at Alphabet. A
H-Man, the million dollar question, when is there enough AI capex spending?
When the Swallows Come Back to Capistrano https://share.google/W7H2gZ1z9NEnCKlgk
I have actually been to San Juan Capistrano to see the swallows. Traditionally they return every year on March 19th, but their number has been far less since the mission was renovated about 20-years ago. I have no idea how the little birds will weigh-in on AI capex spending this spring.
Bubble, Bubble, Toil and Trouble!
Procrustes at Large
This is another one of those awkward moments when I find myself having to reluctantly lecture people who should know more about a given subject than I do, but apparently don’t. (I dread these moments because it scares me: How is it that someone like me knows so much more about so many things than people who are vastly smarter and wildly more successful? It’s like finding out your parents don’t have all the answers, and it happens to me at least twice a month in all sorts of contexts.)
This
I found myself wondering earlier today about which (future?) companies might be the principal beneficiaries of AI in 10-20 years; the Amazons (rather than the Oracles) of AI. I thought about TOST and BrainChip; from restaurants (online bookseller) to ?? (online everything)? I doubt that NVDA and energy suppliers will be the principal winners. Some undergrad in a dorm room probably has an idea.
Very thoughtful/perceptive article., H.
The circular spending at Microsoft has been obvious for some time, but I guess investors were too enamored of Satya’s earnings day pitches, plus the lack of Azure/cloud transparency in the earnings release allowed investors to pretend the growth in Azure wasn’t dominated by OpenAI’s needs. Last week’s .41 hit to earnings from MSFT’s investment crystallized potential future volatility from their OAI stake, not to mention vulnerability from a business model collapse. In META’s case, investors have been deaf, dumb and blind as Zuck made clear his ambitions several quarters ago. His conference call line last quarter re the “cognitive disadvantage” people unencumbered by META’s glasses will suffer was the height of absurdity and arrogance, only surpassed by this quarter’s claim that META has been the world’s most successful at product development so “trust me.”
It was always gong to be the case that A/I winners and losers would become clear only with the passage of time. For now, at least, Google and Amazon appear to be monetizing their A/I investments, while Apple’s timidity may yet turn out to be intelligent caution. Zuck vs. Altman was an egotistical race to destroy shareholder value.
I forget who said identifying a technology’s pioneers was easy- they’d be the ones with the arrows sticking out of their backs.
This reminds me of a time 30 years ago when I was managing one of the many businesses owned by my employer and I would get excited about technological breakthroughs. He said we are not going to get involved in innovation, let them spend the money developing it and when they go broke, we can buy them for ten cents on the dollar.