OpenAI was already projected to burn money at a ludicrous rate and now the news is they are going to burn it even faster. I just don’t see how this ends well for anyone. Regardless of what you think of AI it is apparently entirely too expensive to run. Maybe costs will come down dramatically, but is that at the cost of stagnation in the models? And if that is the case is AI a failure to investors?

At some point in the next few years investors are going to want their returns. The only way I see that happening is though an IPO and then… I don’t know if they have a sustainable business model or one in sight.

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nextaccountic a day ago | parent [-]

Or, they crash and burn, maybe taking Anthropic with them too

Which doesn't mean an end to the AI race, since China is unlikely to care whether US companies secure financing

Also, if this happens OpenAI will probably bailed out with taxpayer money

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etempleton a day ago | parent | next [-]

I disagree that they would be bailed out. The contagion and impact on the larger economy would be somewhat limited. They would more than likely just be sold to the highest bidder. The US would certainly dictate that the buyer is a US company, but I don’t see a bail out.

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therobots927 a day ago | parent | prev [-]

Why would they be bailed out? They aren’t a bank.

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nextaccountic a day ago | parent [-]

Auto companies were bailed out in 2008, so that's not exclusive to banks

As to why.. it's corruption. They would be bailed out as an act of corruption, to use the public machine for private gains.

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etempleton 21 hours ago | parent | next [-]

GM was bailed out because of the potential loss of US manufacturing jobs and the fact that auto factories can be converted to build other things in times of war. There was also no readily available buyer for GM as Ford was also hurting and there wasn't anyone else in a position to buy such a large company who was interested, though perhaps someone would have emerged over time.

OpenAI is a young company and if it collapses it is an indictment that AI is perhaps not really all that valuable. Further the technology and brand can be sold to a US company with plenty of expertise in AI themselves. The loss of jobs, relative to the larger economy, is minuscule. Google, Microsoft, Amazon, Apple, would all be happy to buy at a discount.

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therobots927 a day ago | parent | prev [-]

That would sink the Republican Party.

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etempleton 21 hours ago | parent [-]

I am sure buying OpenAI would be the thing that does it.

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therobots927 21 hours ago | parent [-]

It certainly won’t help. And I’m not just saying the headline “US bails out OpenAI for $850B” will cost them support. The programs they cut to fund said purchase will cost them support. And that’s assuming they can even pull this off by November, because if the democrats take back the house and senate it’s game over. They won’t have time to fund the purchase with corporate tax breaks. At any time dems may be able to force a shutdown just like they did over DHS funding.

	▲	nextaccountic 5 hours ago \| parent [-]
		> The programs they cut to fund said purchase will cost them support. They want to cut those programs anyway, it's a win/win. The Iran war is probably going to cost $1T or more (it's ranging from $1B/day to $2B/day already), so it's going to be more costly than this hypothetical OpenAI bailout. The Republican base doesn't care.