

So I’m not double checking their work because that’s more of a time and energy investment than I’m prepared for here. I also do not have the perspective of someone who has actually had to make the relevant top-level decisions. But caveats aside I think there are some interesting conclusions to be drawn here:
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It’s actually heartening to see that even the LW comments open by bringing up how optimistic this analysis is about the capabilities of LLM-based systems. “Our chatbot fucked up” has some significant fiscal downsides that need to be accounted for.
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The initial comparison of direct API costs is interesting because the work of setting up and running this hypothetical replacement system is not trivial and cannot reasonably be outsourced to whoever has the lowest cost of labor due. I would assume that the additional requirements of setting up and running your own foundation model similarly eats through most of the benefits of vertical integration, even before we get into how radically (and therefore disastrously) that would expand the capabilities of most companies. Most organizations that aren’t already tech companies couldn’t do it, and those that could will likely not see the advertised returns.
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I’m not sure how much of the AI bubble we’re in is driven even by an expectation of actual financial returns at this point. To what extent are we looking at an investor and managerial class that is excited to put “AI” somewhere on their reports because that’s the current Cutting Edge of Disruptive Digital Transformation into New Paradigms of Technology and Innovation and whatever else all these business idiots think they’re supposed to do all day.
I’m actually going to ignore the question of what happens to the displaced workers here because the idea that this job is something that earns a decent living wage is still just as dead if it’s replaced by AI or outsourced to whoever has the fewest worker protections. That said, I will pour one out for my frontline IT comrades in South Africa and beyond. Whenever this question is asked the answer is bad for us.


Factor Fexcectorn sounds like a Roman centurion who tried to improve the army’s logistics by hitching multiple wagons together in sequence.