News for hackers. Stuff that matters.
Re:The AI boom is causing shortages everywhere else by mike_hearn on Saturday February 07, 2026 @03:40PM (#46927723)
AI, obviously! A bubble doesn't mean demand vanishes overnight. There is - at current price points - much more demand than supply. That means the market can tolerate price hikes whilst keeping the accelerators busy. It seems likely that we're still just at the start of AI demand as most companies are still finding their feet with it, lots of devs still aren't using it at all, lots of business workflows that could be automated with it aren't and so on. So there is scope for raising prices a lot as the high value use cases float to the top, maybe even auctioning tokens.

Let's say tomorrow OpenAI and Anthropic have a huge down round, or whatever event people think would mark the end of the bubble. That doesn't mean suddenly nobody is using AI. It means they have to rapidly reduce burn e.g. not doing new model versions, laying off staff and reducing the comp of those that remain, hiking prices a lot, getting more serious about ads and other monetized features. They will still be selling plenty of inferencing.

In practice the action is mostly taking place out of public markets. We won't necessarily know what's happening at the most exposed companies until it's in the rear view mirror. Bubbles are a public markets phenomenon. See how "ride sharing"/taxi apps played out. Market dumping for long periods to buy market share, followed by a relatively easy transition to annual profitability without ever going public. Some investors probably got wiped along the way but we don't know who exactly or by how much.

Most likely outcome: AI bubble will deflate steadily rather than suddenly burst. Resources are diverted from training to inferencing, new features slow down, new models are weaker and more expensive than new models and the old models are turned off anyway. That sort of thing. People will call it enshittification but it'll really just be the end of aggressive dumping.

Re:The AI boom is causing shortages everywhere else by DrewADesign on Saturday February 07, 2026 @04:05PM (#46928011)
There may not be that much demand at a price that yields profit. Demand at current heavily subsidized “the first dose is always free” prices is not a great indicator unless they find some way to make themselves indispensable for a lot of tasks for a lot of people. So far, they haven’t.
Re:The AI boom is causing shortages everywhere else by mike_hearn on Saturday February 07, 2026 @05:37PM (#46928930)
Yes if/when prices rise there'll be demand destruction but I think demand will keep rising for the foreseeable future anyway even incorporating that. Lower value use cases like vibe coding hobby apps might fall by the wayside because they become uneconomic but the tokens will be soaked up by bigger enterprises that have found ways to properly integrate it at scale into their businesses. I don't mean Copilot style Office plugins but more business-specific stuff that yields competitive advantage.
Re:The AI boom is causing shortages everywhere else by DrewADesign on Saturday February 07, 2026 @09:30PM (#46930748)
You’re just repeating their predictions. Investors are starting to get nervous that there’s no real proof these things could justify burning a Mt. Everest sized pile of $100 bills to achieve.
Re:The AI boom is causing shortages everywhere else by mike_hearn on Sunday February 08, 2026 @04:42AM (#46932834)
Yes it's only a prediction based on what I'm seeing. And I'm not disagreeing with the investors that there's overinvestment right now. Prices need to rise, spending on R&D needs to fall for this stuff to make economic sense. I'm only arguing that there's plenty of demand, and assuming price rises happen smoothly over not too short of a period, any demand destruction at the lower levels will be quickly counter-balanced by demand creation at higher value-add levels.

It's also possible non-tech industries just have a collective imagination failure and can't find use cases for AI, but I doubt it.

Re:The AI boom is causing shortages everywhere else by DrewADesign on Sunday February 08, 2026 @08:43AM (#46934129)
I know there is demand — I even know a few people in high-level dev roles, one easily in the 99th percentile for pay, that were taken from their regular, important dev tasks to make agents for paying clients.

I’m not worried about the technology flourishing. I’m worried about my fucking retirement, know what I mean? The question isn’t whether there is demand, it’s how much demand there is, because they’re betting on having all the demand. I don’t have a ton of money. People getting this wrong in a way my financial advisor can’t outmaneuver is an existential threat to my ability to not live in crumbling public housing in a few decades.

We’re talking about this needing to meaningfully move towards making whole digit percentages of the US GDP, soon. Not only are these initiatives largely unprofitable, they’re increasing their expenses based on hopes and vibes. I think a whole lot of people are so focused on short-term gains and being king of the hill that sustainability is a distant afterthought — just like it was in the .com era. I have zero faith in the current cohort of tech leaders to get this right.

Re:The AI boom is causing shortages everywhere else by Krei-se on Saturday February 07, 2026 @07:15PM (#46929841)
I find myseld using dumber free models more as they reply instantly and keep me learning.

Some local models run well already too and do the job. Not sure if i would pay any money when a discarded mac can run these just fine already.

This may turn out like trying to make people game over streaming.

Re:The AI boom is causing shortages everywhere else by blks on Saturday February 07, 2026 @04:11PM (#46928082)
Please respect other users of hacker news and don’t generate your replies with LLM
Re:The AI boom is causing shortages everywhere else by zozbot234 on Saturday February 07, 2026 @04:28PM (#46928269)
FWIW, GP doesn't look like clanker speak to me. It's a bit too smooth and on-point for that.
Re:The AI boom is causing shortages everywhere else by mike_hearn on Saturday February 07, 2026 @05:28PM (#46928848)
I never use LLMs to write for me (except code).
Re:The AI boom is causing shortages everywhere else by blks on Sunday February 08, 2026 @10:42AM (#46935263)
Sorry for the false acquisition. Your reply, and your other replies all felt suspicious to me.
Re:The AI boom is causing shortages everywhere else by mike_hearn on Monday February 09, 2026 @05:51AM (#46943845)
Why? I didn't even use a proper em-dash, just a minus sign.
Re:The AI boom is causing shortages everywhere else by dickersnoodle on Saturday February 07, 2026 @03:42PM (#46927760)
"much more demand than supply"? Demand from who?
Re:The AI boom is causing shortages everywhere else by joe_fishfish on Saturday February 07, 2026 @04:02PM (#46927972)
The demand from middle managers trying to replace their dev teams with Claude Code, mainly.