I admittedly didn’t take the time to read all 10,000 words of him shouting into the void in detail. But the capex complaints seem trivially misguided?
Current revenue is being generated from capex investments in the past; the most recent capex hasn’t begun to pay off at all. That’s expected.
Now, I don’t know if those investments ever will pay off and there are reasons to be skeptical. But if you assume the capex doesn’t lead to any revenue, then you’re just assuming the conclusion that the investments are bad…
I don't know if ed realizes that criticizing the capacity issues of anthropic directly contradicts his early, fierce take he'd had since early on (and is slowly retreating from) that they would not be having capacity issues unless people found this tool useful enough to cause the capacity issues in the first place. He claimed up to a few months ago that these tools were not useful, would never be useful, and people weren't actually using them to do anything useful, just as fun toys. Clearly, in the case of anthropic, this isn't true, as the enterprise side is growing so rapidly - the only way you could say this is bs is if you think the entire tech sector is experiencing delusion about their usefulness, which he used to say, but doesn't anymore.
I think he's just locked in to this performance. He raises a lot of interesting points in his articles, but gets a little over his skis when he conflates the absurdity of particulars with long term death of the entire industry (people thought the same thing about .COM and look where we ended up). The applications of this technology are both more immediately applicable and relatable versus some recent bubbles.
Textbook audience capture: once you've built your entire brand on "AI is a scam", you can't back down even if the facts change, because your paying customers are there for that take— the demand for "AI is a scam" takes is almost as frenzied as the demand for AI compute right now— and going back on it literally threatens your ability to pay the mortgage.
This is a big reason why I'm none too happy about the rise of individual-authors-as-brands via Substack replacing traditional journalism: once people are following and paying you specifically for a specific opinion, you're locked in. A very small number of individual bloggers have a brand of "I'll say the truth no matter what" and actually mean it, but the overwhelming majority are like Ed.
"A lot of people use this tool" and "this tool is productive and useful" don't necessarily track. People do and use all kinds of things that aren't actually useful, they just feel useful, and I think that's the argument most AI critics would make.
Companies don’t generally torch money on things that don’t improve their bottom line at a scale like this. Yes you can point to saas bloat and crappy tools like jira, but this isn’t some trend thing anymore. I know because I’ve been personally seeing it play out.
There was an argument to be made that bigger companies with skin in the game were and are making a bigger deal than they should have about how useful it is, but enterprise is growing way, way beyond those companies and it can’t really be easily explained away.
Like this:
> And really, why do these capacity constraints not seem to have any effect on its revenue growth?
Is either absolute obtuseness on purpose, or completely dishonest. Obviously the answer is people find it worth the spend even with the capacity issues. What other answer could there be? To ed, he will say they are simply lying about their revenue and doing accounting tricks, which is a crazy claim to make with no evidence.
You just shifted the goalpost a lot from the original comment that was being replied to. The answer of course, is no to the first, and 2nd is not really knowable. I'm not sure what that really demonstrates or what your point is.
They asked about revenue and profit, you ignored profits and focused on revenue, so I focused in on when will profits happen, one of the items OP wanted to know about. I don't see how it's an unreasonable follow-up?
> the enterprise side is growing so rapidly - the only way you could say this is bs is if you think the entire tech sector is experiencing delusion about their usefulness,
i am talking about revnue/profit growth of ai consumers ( not producers). if they are making anything useful or improving productivity surely it would it show up in numbers right? otherwise whats the point.
This is pure speculation on my part, but the way I think this will play out is something like this:
- current CapEx will make the production side increase capacity
- advances in TPUs, NPUs, open weight and quantization will keep going at a rapid pace
- when the spending slows/stops, hardware prices will drop, hard
- most AI workloads will move to the edge (except frontier models) because the hardware is cheaper than a subscription
(and at some point there could be a crash like 2008)
For example, most of my AI use lately has been running Qwen3.6-35B-A3B-UD-Q8_K_XL on a 64GB MacBook Pro with an M3 Max. It runs at ~57 tokens/s and it's mostly fine.
I do use the frontier models a bit, but only when the task is too complex for the local model.
Basic crap, like analyzing an existing codebase and bouncing ideas, making small changes, the local model is enough.
I admittedly didn’t take the time to read all 10,000 words of him shouting into the void in detail. But the capex complaints seem trivially misguided?
Current revenue is being generated from capex investments in the past; the most recent capex hasn’t begun to pay off at all. That’s expected.
Now, I don’t know if those investments ever will pay off and there are reasons to be skeptical. But if you assume the capex doesn’t lead to any revenue, then you’re just assuming the conclusion that the investments are bad…
I don't know if ed realizes that criticizing the capacity issues of anthropic directly contradicts his early, fierce take he'd had since early on (and is slowly retreating from) that they would not be having capacity issues unless people found this tool useful enough to cause the capacity issues in the first place. He claimed up to a few months ago that these tools were not useful, would never be useful, and people weren't actually using them to do anything useful, just as fun toys. Clearly, in the case of anthropic, this isn't true, as the enterprise side is growing so rapidly - the only way you could say this is bs is if you think the entire tech sector is experiencing delusion about their usefulness, which he used to say, but doesn't anymore.
I think he's just locked in to this performance. He raises a lot of interesting points in his articles, but gets a little over his skis when he conflates the absurdity of particulars with long term death of the entire industry (people thought the same thing about .COM and look where we ended up). The applications of this technology are both more immediately applicable and relatable versus some recent bubbles.
Textbook audience capture: once you've built your entire brand on "AI is a scam", you can't back down even if the facts change, because your paying customers are there for that take— the demand for "AI is a scam" takes is almost as frenzied as the demand for AI compute right now— and going back on it literally threatens your ability to pay the mortgage.
This is a big reason why I'm none too happy about the rise of individual-authors-as-brands via Substack replacing traditional journalism: once people are following and paying you specifically for a specific opinion, you're locked in. A very small number of individual bloggers have a brand of "I'll say the truth no matter what" and actually mean it, but the overwhelming majority are like Ed.
"A lot of people use this tool" and "this tool is productive and useful" don't necessarily track. People do and use all kinds of things that aren't actually useful, they just feel useful, and I think that's the argument most AI critics would make.
Companies don’t generally torch money on things that don’t improve their bottom line at a scale like this. Yes you can point to saas bloat and crappy tools like jira, but this isn’t some trend thing anymore. I know because I’ve been personally seeing it play out.
There was an argument to be made that bigger companies with skin in the game were and are making a bigger deal than they should have about how useful it is, but enterprise is growing way, way beyond those companies and it can’t really be easily explained away.
Like this:
> And really, why do these capacity constraints not seem to have any effect on its revenue growth?
Is either absolute obtuseness on purpose, or completely dishonest. Obviously the answer is people find it worth the spend even with the capacity issues. What other answer could there be? To ed, he will say they are simply lying about their revenue and doing accounting tricks, which is a crazy claim to make with no evidence.
when will this show up in revenue and profit numbers or these enterprises ?
otherwise its just "fun toys" right?
I'm not sure what you mean. Anthropic in particular's revenue is exploding, driven by enterprise demand. There's no real evidence to claim otherwise.
Is Anthropic profitable and/or profitability on the horizon?
You just shifted the goalpost a lot from the original comment that was being replied to. The answer of course, is no to the first, and 2nd is not really knowable. I'm not sure what that really demonstrates or what your point is.
How so that comment asked about profits
> when will this show up in revenue and profit numbers
This was the comment
They asked about revenue and profit, you ignored profits and focused on revenue, so I focused in on when will profits happen, one of the items OP wanted to know about. I don't see how it's an unreasonable follow-up?
> the enterprise side is growing so rapidly - the only way you could say this is bs is if you think the entire tech sector is experiencing delusion about their usefulness,
i am talking about revnue/profit growth of ai consumers ( not producers). if they are making anything useful or improving productivity surely it would it show up in numbers right? otherwise whats the point.
usefulness isnt a feeling.
btw. top two links on hn right now are
> Appearing Productive in The Workplace
> The bottleneck was never the code
This is pure speculation on my part, but the way I think this will play out is something like this:
(and at some point there could be a crash like 2008)For example, most of my AI use lately has been running Qwen3.6-35B-A3B-UD-Q8_K_XL on a 64GB MacBook Pro with an M3 Max. It runs at ~57 tokens/s and it's mostly fine.
I do use the frontier models a bit, but only when the task is too complex for the local model.
Basic crap, like analyzing an existing codebase and bouncing ideas, making small changes, the local model is enough.
> In reality, they’re the paypigs for Anthropic and OpenAI
> In fact, fuck it, I’m ending this with a rant.
What is this. People pay for this?
“I’m ending this with a rant” made me laugh. What was the rest, then?
Did AI run over this guy's dog or something lol.
He seems to have done nothing but write hundreds of thousands of words about how much AI sucks and is doomed to fail for the past 2 years.
he discovered the niche early on and latched on to it. There is a big market for it now given how widely AI is hated by all sections of population.