Stephen Downes

The AI industry is going to fail, writes Ed Zitron. "Venture capitalists have invested in unprofitable, low-revenue startups with valuations that they can never sell at. And, like homeowners in the dismal years of 2008 and 2009, they're almost certainly underwater - they just haven't realized it yet." No doubt, the current business model (explained with a detailed discussion of Cursor) is not sustainable. Providers can't raise prices enough to make back the billions invested. But I resist the conclusion that AI will therefore fail. Instead, I reason that "ergo, subscription fees are not the business model". So what is? Well, that's a much tougher question to answer. We have to think big. Taking over the financial sector? Replacing all of education? I remember when Google had no good business model for search, and people began to suspect they were actually fleecing investors. But search wasn't the model; advertising was. The developers of AI are looking at something similar, in my view.