GoKawiilIf you liked this piece, you should subscribe to my premium newsletter. It’s $70 a year, or $7 a month, and in return you get a weekly newsletter that’s usually anywhere from 5,000 to 18,000 words, including vast, detailed analyses of NVIDIA , Anthropic and OpenAI’s finances , and the AI bubble writ large (updated to version 3.0 last week). My Hater's Guides To the SaaSpocalypse , Private Credit and Private Equity are essential to understanding our current financial system, and my guide to how OpenAI Kills Oracle pairs nicely with my Hater's Guide To Oracle .
Over a three week period in May , I published an exhaustive three-part guide to how the AI bubble might collapse, the events that might trigger it, and the consequences. For something lighter, check out last week’s premium, where I re-introduce you to the antagonists of the AI bubble (and their fatal weaknesses) in caustic, slightly sweary terms.
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Last week I went on Bloomberg and discussed the state of the AI bubble with a clarity that rattled even the sweatiest boosters, mostly because I spoke with clarity about an investment frenzy whipped up through hype, deceit and mythology. Some were equal parts frustrated and angry that I don’t have money in the market, or, as they’d put it, “skin in the game.”
I get it! When your entire worldview is dictated by what a series of venture capitalists and psuedo-journalists on Twitter want you to believe, it must be difficult to imagine someone having “morals” or “beliefs” or that one might hold a position that wasn’t entirely based on greed or tribalism. It must be confusing — upsetting, even! — to hear that somebody is willing to accurately and vociferously tear into a tech industry largely controlled by people with no regard for their users or workers, who are willing to bathe their products in mediocrity all because it’s the thing that everybody else is doing.
This is a hysterical era perpetuated by liars, cowards, imbeciles, craven boosters and the easily-fooled. Those excited about generative AI are either the victim or the perpetrator of a con centered around a technology to ingratiate at the highest cost possible.
AI Cannot Afford To Slow Down — It Needs $3 Trillion Or More In Revenue By End Of 2030 To Sustain Its Existence
I also think that everybody is a little flippant about what has to happen for me to be wrong.
Whatever obtuse fantasies you have about the current state of generative AI are irrelevant to a much larger problem: that the infrastructure being built and compute commitments being made are being done so at a level that demands that generative AI and AI compute generate over $2 trillion in annual revenue by 2030. When I say that, I mean it absolutely has to do that otherwise none of the data center capex makes sense, and neither Anthropic nor OpenAI can pay their commitments.
OpenAI expects to spend $50 billion on compute in 2026 , and I wouldn’t be surprised if Anthropic spends anywhere from $30 billion to $50 billion. Between them, Anthropic and OpenAI represent the vast majority of all AI compute demand — at a minimum 70% , if not 80% to 90%.
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