Is AI demand real, or just because it's cheap?
This is worth sitting with because it questions the economics underneath the AI boom you are building around: is demand for AI actually strong, or does it only look strong because the price is being kept artificially low?
A poster on the r/ArtificialInteligence forum lays out the argument. Companies are spending billions on AI infrastructure, buying GPUs (the chips that run AI models) and building data centers, much of it funded by loans. They point to rising demand as the reason. The poster agrees demand is real, but argues it is mostly because the price is low: they run Claude and ChatGPT on their own code because it is cheap enough to be worth it, and say they would not use it at double the price, or would switch to a cheaper model for anything that is not critical work.
Their core claim: AI companies cannot be profitable at today's prices, because getting a big profit margin on running the model to get an answer is not realistic when several companies are competing against each other with their own models. The post ends by simply asking what happens to these companies if that is true.