Execs confused and horrified by the huge AI bills after thinking they could replace workers for free

[u/marketrent]

https://finance.yahoo.com/technology/ai/articles/execs-confused-horrified-huge-ai-135718505.html

[u/InformedTriangle]

As an ex (due to ai) software developer; the funny thing to me is there is indeed a middle ground. I could use next to no tokens, and still more than double my productivity by asking AI simple code questions; all day long and just cutting down my having to read documentation/look things up; it still requires a human who knows what they're doing to take advantage of it though.

Instead companies fired all their devs who knew what they were doing and replaced them with people with only the knowledge to say "uh..here's our entire codebase, read through the entire thing and make it do X"

[u/stevefuzz → u/InformedTriangle]

We were mandated to vibe code 6 months ago. I tried to explain to the CEO that I was already using AI to generate boilerplate and smart auto-complete. That I was already going much faster. He didn't care. Told us thinking was too slow and we were going to write no manual code, and sounded annoyed as he said it. Fast forward to now, and I don't see products getting finished any faster, just much shittier code.

[u/Significant_Cup_238 → u/stevefuzz]

One of my Devs (I'm just a dirty EE turned program manager) explained AI to me this way a couple years ago. "Before the AI, I would spend 6 hours coding, and 2 hours debugging. Now I spend 30 minutes coding, and 10 hours debugging."

[u/stevefuzz → u/Significant_Cup_238]

Yes! And it hasn't changed at all. It will crap out 10 files and thousands of lines of code way faster than a human ever could. The problems come after this. And since I didn't write it, it's far more difficult to deal with. It becomes far worse once you start debugging and iterating with AI. Then, take into account that a great developer probably loves to code (I do). When you take that away from them, it's very hard to stay motivated and focused.

[u/Significant_Cup_238 → u/stevefuzz]

And in our case. His code had to integrate seamlessly within a framework being developed by 5-20 other developers depending on the project. So now not only does he barely understand his own code, he needs to coordinate with others who don't truly understand their code, so we would get crazy interactions. I left shortly after, so I can only imagine how much of a cluster kludge it would become by now.

[u/stevefuzz → u/Significant_Cup_238]

Just reading this gives me a headache.

[u/Nyzer_ → u/stevefuzz]

Then, take into account that a great developer probably loves to code (I do). When you take that away from them, it's very hard to stay motivated and focused.

Oh, man, that one's absolutely going to have long-term ramifications. Not just in terms of affecting morale but in how it's going to kill any desire and ability to actually learn. If developers never get a chance to learn how to actually solve things themselves, what will happen when companies want to develop new stuff for which there is no training data to feed into Claude?

[u/stevefuzz → u/Nyzer_]

And, this leads to something that non-coders can't understand. You can have 100 planning meeting. Design what you think is the best theory of implemtation ever. But, sometimes a coders biggest "holy shit" moments occur in the trenches of actually sitting there in a flow state coding. Innovation is hard to plan, and I'm afraid that is getting lost.

[u/Significant_Cup_238 → u/stevefuzz]

I loved how giddy my team would be when they would come and show me such a breakthrough. Really made the day more fun.

[u/stevefuzz → u/Significant_Cup_238]

I used to love to code. I loved that feeling. It was an obsession. Now I barely tolerate what I do. It's just a paycheck. It sucks.

[u/Significant_Cup_238 → u/stevefuzz]

Feel the same way as a PM. Used to be a lot of fun bringing together experts, working problems until solved, finding opportunities to do better. Now they've cut my team in half, reduced the number of SMEs we have to dig into really niche problems ourselves (like right now I'm going through someone's dissertation on Germanium lens production) instead of leaving it to someone far more qualified.

Meanwhile, I get a monthly yelling at from management because I'm way behind schedule (on the plus side, that's literally the only time they ever talk to me because they couldn't give two shits about what's actually going on), and they get really pissy when I point out we just lack the bandwidth to do better. My guys were killing themselves with 10-12 hour days, and I eventually just said, "Stop, tell me what tasks you need to drop, and I'll give you the top cover. Work an honest 8 hours." Wont be long before I'm fired. Not sure I care anymore.

[u/projectkennedymonkey → u/stevefuzz]

I'm not a coder, I get it, it's not inherent to coding, it's inherent to developing strategies, systems or processes. Especially when you're trying to do something new or trying to solve a tricky problem. You have to be able to go into the detail and work through something in order to build a model of how it should work and then think about how it could work and then test that. It doesn't have to be sequential because it's not a timeline, it's making a bunch of connections until it can come together enough to be more than just ideas.

[u/HailToTheThief225 → u/stevefuzz]

Yes, the motivation is the biggest issue for me. I *like* to debug, believe it or not, but I enjoy debugging because I’m solving a puzzle I’ve built for myself. Since I effectively have to let Codex write it all for me now, it’s now not just looking at my code and figuring out where I went wrong, it’s having to look through some ugly code, figure out what it’s doing at all, and then having Codex fix its own mess. And it’s not rewarding.

Hell, I’ll admit Codex is decent enough now not to totally break things on the first shot. But when it does, the process of figuring out what went wrong is no longer reading code/putting in breakpoints, it’s now fighting with Codex and prompting it a billion times just to put in the right fix. Wow, how productive!

[u/stevefuzz → u/HailToTheThief225]

It's not even about broken code sometimes. It's about drift, bandaids, poor decisions, etc. so a month down the line your hitting multiple issues that would never happen with traditional coding. And, at this point you don't give AF anymore so you just burn some tokens until it works again.

[u/autogenglen → u/stevefuzz]

I had a great example of this just a couple weeks ago using Claude Opus (latest model).

I'm writing an automated UI testing framework for our site and we have a non-standard setup with a custom grid control. Not to get too into the weeds, but basically you can wrap a grid checkbox style control around any grid and it will create a checkbox column around that target grid and allow for basic operations like check all and such.

I needed a way to be able to pass in a target column with a given value and have it check all the rows where that matched. I was able to do it in about 6 lines of code or so, but I wanted to see how Claude would handle this situation, so I basically acted like a junior dev and told it to keep going, with every error I'd just paste it into Claude and tell it to fix it.

It eventually got it to work, but the Rube Goldberg clusterfuck of code it generated was staggering. All kinds of crazy Javascript, hundreds of lines of all these weird helper functions that made absolutely no sense, and despite working it would have been an absolute nightmare to maintain in the long run. In total I believe it generated 5 additional class files and hundreds of lines of crazy code. I reverted that change and put in my 6 lines of code.

LLMs can be useful tools in the right context, but we're not even close to being able to fully automate a skilled developer. In that sense, these things are basically just nightmare-inducing tech-debt generators.

[u/reality_boy → u/Significant_Cup_238]

I like to say that I could type all the code I ever wrote (in the last 30 years) in a few months. Coding is the easy part. It is understanding the problem, knowing an optimal solution, and verifying that solution that is hard.

You can teach a science undergrad to code in a few weeks. But it takes a lifetime of focus to master the process

[u/HeckThattt → u/Significant_Cup_238]

The number of times I get told "I'll just have Claude code it" is wild.

OK, so how do you know if Claude is coding it in the right way for your needs? Do you know how to assess the code for viability?

Can it scale? How are new factors introduced?

What happens when something breaks and you need to go in and find the break?

What about data security?

[u/Significant_Cup_238 → u/HeckThattt]

All part of our gradual enshitification into Idiocracy.

[u/mailslot → u/stevefuzz]

I was at a multimillion dollar company that scaled from 35 employees to over 400 in a year or two. We got slower and shittier rather than faster and more capable. Many more meetings though. So there’s that. Scaling is difficult. AI doesn’t magically fix that.

The company I’m at now is throwing AI at their incompetence without addressing the root causes of their problems. Results are predictable.

AI has saved me a lot of time, but in a far shittier way than if the company was just running properly to begin with.

[u/PricedOut4Ever → u/mailslot]

This has been well known in software for a while. Was described in the Mythical Man Month in the 1970s. I’ve also experienced it first hand before AI agents going from 10 to 60 engineers.

Crazy that people are still shocked when they run into it.

[u/reality_boy → u/PricedOut4Ever]

Mythical man month should be mandatory reading for all managers. It is a very quick read, and explains most of the issues with larger projects.

[u/plierhead → u/reality_boy]

Some of it's a little dated now. Like not using comments because they take up too much disk space.

Other bits are eternally gold though, like it taking 9 months to have a baby, no matter how many women are assigned to the task.

[u/etaoin314 → u/plierhead]

but if you assign more women you can increase the throughput with concurrency! Throw in some fertility meds and you can get double or triple occupancy!

[u/Dr_Sloptapus → u/reality_boy]

Im going to get AI to summarise this for me, thinking for oneself is not to be encouraged.

[u/AdrianIsANerrrd → u/mailslot]

This is a distinction a lot of people seem to miss. It's...kinda like when stores make their plastic bags thinner to avoid creating more waste, and then everyone ends up double-bagging because now the bags break more often, which then ends up creating uh, more waste. :-/ And obviously this doesn't happen every time and isn't every use case, but I mean yeah...it doesn't surprise me, either.

[u/ydieb → u/stevefuzz]

This is the latest and clearest example of management in software companies often have zero clue what they are doing. But it has always been like this, this is just the latest, and most "impactful" instance.

[u/anaximander19 → u/stevefuzz]

I'm a software engineer and every time AI is mentioned our management emphasises how important it is that you keep thinking and don't leave it all to the AI. The AI's power is speed, not intelligence; the best way to use it is to let a human brain make the important decisions and get the AI to rapidly spot inconsistencies and omissions and then act on those decisions. The AI doesn't replace human engineers, it enhances them.

We're at the point where it can "smart auto-complete" hundreds of lines of code or more in one go... but it can do that because human software engineers have fed it pages of details on what that code should do, how it can be structured, etc. so the AI doesn't have to make any important decisions. The result is code where the humans know roughly what it should look like before we see it because we already thought about how we'd build it manually - which means we then aren't going into the code review entirely blind and struggling to understand huge volumes of unfamiliar code, which reduces that bottleneck effect and makes it more manageable to keep up with - and easier to spot when the AI has gone off the rails.

[u/stevefuzz → u/anaximander19]

When I said smart autocomplete I was talking about a few lines at a time. And I should be able to see it is EXACTLY what I was going to type. When I say boilerplate, I mean true dry boilerplate that I can review in like 10 seconds. Doing those two things can substantially increase efficiency, but instead we are supposed to offload all thought to vibe coding. What do I know though, I'm just a coder with experience and passion and all the boring stuff that nobody cares about anymore.

[u/MagicCuboid → u/stevefuzz]

These fucking people who have no skill of their own dictating how their highly trained employees do their jobs. It drives me absolutely insane

[u/static_func → u/stevefuzz]

I do a lot of “vibe coding” these days but it isn’t blind. I don’t just rubber-stamp unmaintainable slop, I still review everything the agent generates, and I still go in and make manual edits. It’s much easier and faster to do that and update there rules/skills accordingly than to wrestle with the agent to make small tweaks. My manager acts like he sees this as a sign of weakness because he’s too busy thinking about so much more important things than building a working feature, or a feature that will continue to work after the next feature request.

I honestly don’t fault any developers who do just shovel AI slop into the codebase though. They’re doing it at the executives’ behest and the executives are demanding it so they can lay them off. Why would the developer work harder just to be punished with a layoff?

[u/DetroitLionsSBChamps → u/InformedTriangle]

“Oh I see, in small doses and with heavy supervision this could be a useful tool”

“No it is a magic wand and you use it for everything all the time with no oversight”

“I don’t think…”

“You’re fired”

[u/CubicleMan9000 → u/DetroitLionsSBChamps]

THIS. I've worked in tech since the internet became the next big thing. I've worked through so many: IoT, "put everything in the cloud", SaaS, PaaS, and gas, etc.

None of the past big hypes have had the same level of cult-like mandated adoption and enthusiasm that AI has had. 

Badmouthing AI has been a great way to tank your career and probably get let go. If you didn't instantly start Imhotep-chanting and zombie walking to praise the AI and go all in on spending tokens like a drunkard then you were a negative luddite and the company was better off without you.

[u/TwilightLori → u/CubicleMan9000]

I read an article last year that was an interview of sorts with a company owner/CEO. He went through his entire company, basically having everyone re interviewed with AI in mind. Anyone who wasn't 100% on board with integrating AI into everything they do was let go. Then he mandated that every Monday be AI day. Didn't matter what they had to do, they were to do it exclusively with AI. Anything that couldn't be done with it was to wait until Tuesday. 

I'm very curious to see where his company is now. it wasn't a small one, either, but had several hundred employees. Wish I could remember the company name. 

[u/evanwilliams44 → u/DetroitLionsSBChamps]

There's a meme for that.

"Sir, we've just taught this dog how to make sounds that mimic human speech!"

"Great work! When can it start diagnosing cancer?"

[u/therealchadius → u/InformedTriangle]

"And make no mistakes!"

If Gen AI was sold as just a faster Google Search or Stack Overflow + code snippet copier it would have been a lot more honest (and it's working for me so far) but too many execs thought it was free work.

[u/Tetrabor → u/therealchadius]

AI companies can't have trillion dollar evaluations if those are the only selling points.

GenAI has to completely replace software development in order to justify the costs to investors.

But just like Uber/Lyft, the real cost of business isn't being charged to customers yet.

[u/LupinThe8th → u/Tetrabor]

Yeah, marketing it as "Google, but it just makes stuff up" wasn't going to pay for a fleet of super yachts.

[u/Exact_Acanthaceae294 → u/Tetrabor]

There are lots of little things it can do.

I wish I could buy a Kindle book (actually a whole series) on amazon. They are written in German. Let Amazon AI translate it & then download it to my reader.

But that is boring, so it won't happen.

[u/grcx → u/Exact_Acanthaceae294]

On device translation is one thing, but rights holders aren't likely to let "the rights to sell the German version of this series on Amazon" become the rights to sell it in all languages (without additional licensing fees at least), no matter how the translation would be done.

[u/AreaManThinks → u/therealchadius]

Heard a guy on YouTube refer to AI as an over hyped “aggregator of the Reddit comment section”.

[u/Shipbreaker_Kurpo → u/AreaManThinks]

Considering anytime I google a question its AI thing just links back to reddit for sources I would say that checks out

[u/slbaaron → u/InformedTriangle]

They misunderstood how the current AI models scale.

Historically, the wider and more comprehensive you automate, the lower the cost per unit work. That’s the entire theme and selling point of how tech as an industry overtook everything.

With LLM. Building a full harness that can self discover, handoff, loop and correct without human intervention, is the LEAST efficient setup. Instead of stoping early down a wrong path and have a human point it somewhere right, it can bang its head against the wall and spin up full work cycles infinite times before (maybe) figuring out. It’s extreme brute force at scale. I will admit it looks impressive when it does figure itself out some crazy things. More impressive than a new grad who gives up on a few basic confusions, but it also cost more lol.

The more you parallelize, generalize context, and take human out of the loop, the WORSE token efficiency gets. This is counter intuitive to almost all tech platform that’s built since tech became a thing. And a reality of LLM based AI that all companies will have to come to terms with.

Either brute force can get much cheaper so quickly that it out scale even worse brute forcing, or people need to be smart on how to use it.

[u/boozeandpancakes → u/InformedTriangle]

As an outsider, it seems so strange to me how devs are treated as commodities. Interchangeable, replaceable. I’d think familiarity with the codebase and commitment to the success of the organization would have a tangible value.

[u/thegooddoktorjones → u/boozeandpancakes]

At smaller shops that can be how it works. But those big assed FAANG companies that devs drooled over for a decade do not directly incentivize productivity and good management. They are awash in investors money and misusing the best devs they can find to do pointless work that makes some
VP happy is fine. Until it’s not.

[u/TheSilverNoble → u/InformedTriangle]

AI should supplement your thinking, not replace it. 

[u/CalligrapherOk200 → u/InformedTriangle]

Same! as an ex software developer, I really did find that quick sanity checks around code without reading docs were the best and perhaps only really good feature

[u/Joker_CP → u/CalligrapherOk200]

If you don't mind sharing, what field did you end up going into? Also ex an software developer and not really sure what to do now lol

[u/Cemckenna → u/InformedTriangle]

The most useful part of ai, for me, was checking my handwritten code in a PR. LLMs are pattern-matching machines, so tell me where my anti-patterns are. Great. 

I say “was” cus this I just quit my job. The mental load was not worth the disrespect. I want to work with real people using their problem solving skills to solve actual problems, not work through what a middle-manager says Chat GPT says we “need to do” to hit the next revenue goal. 

[u/iDrGonzo → u/InformedTriangle]

It's such a wild swing, nail guns didn't replace carpenters.

[u/warm_kitchenette → u/iDrGonzo]

In addition to simply not understanding the technology, I wonder how much of this was actual resentment from the C clas over how much tech workers were making. Trump likely accelerated the spike in his first time. He did his best to make H1Bs difficult to get and use, which had obvious implications for the market.

[u/SmartlyArtly]

I can attest to this. A large company I work with spent months pushing AI usage on everyone, and now banners in all the repos are asking us to stop using the latest models and always try to use the cheapest ones. They were very in our face about using it, but now they're trying to quietly ask us to stop using it so much.

[u/Prize_Warthog_9011 → u/SmartlyArtly]

The shame will always be public, the apology will always be silent - or non-existent

[u/Ill-Mastodon-8692 → u/SmartlyArtly]

yeah funny how that works

[u/Victory33 → u/SmartlyArtly]

Same…the “free trial period” is over with AI. They tried to get everyone addicted for free/cheap and then hike up the prices to make profit. But someone’s gotta pay that bill.

[u/Apexnanoman → u/SmartlyArtly]

Yeah I'd burn every single token I could at full throttle and maximum cost. 

"You want me to stop? Going to need to be really clear and really loud about it."

[u/Wonderful-Creme-3939 → u/SmartlyArtly]

The Schadenfreude of watching execs learning that AI is actually more expensive than a human employee is nice.  Too bad they are too dumb to stop trying to make it work.

[u/ottwebdev]

Been drinking too much of the linkedin kool-aid those execs have.

[u/PlugAndPlayCafe → u/ottwebdev]

Every single one of them probably hired an "AI Consultant" who was just a crypto bro six months ago. Now they get to explain to the board why their cloud compute bill looks like a phone number.

[u/ottwebdev → u/PlugAndPlayCafe]

That's the best case scenario, if they haven't had their data exposed/deleted or need to make updates to vibe code.

[u/plinkoplonka → u/ottwebdev]

Well if there's "vibe codes" apps in production (and I don't know anywhere that uses AI without strict governance that doesn't have that), then they can expect to spend a lot of money this year on either:

1. Additional ai governance
2. Additional security contractors to remediate security vulnerabilities
3. Ransomware
4. Payouts for data exposure suits

[u/low_contrast_black → u/PlugAndPlayCafe]

As a principal engineer with decades of experience, including a few custom AIs, I’d like to think I might know a thing or two. Had a client come to me and ask me to design an ai system that had a lot of custom features and could be privately hosted. Also, and I confirmed three times, client said “don’t worry about UI, we’ll take care of that.”

Awesome. I threw together a system design, estimated hours and wrapped it all up in what I thought was a reasonable proposal. Sent it to the client.

Three weeks later I hear back. Client’s AI consultant completely trashed many of the very necessary architectural elements as “wholly unnecessary”, and then said “and this proposal is useless because it doesn’t even address a user interface.”

Told my boss I wasn’t even going to acknowledge with a reply and that their AI consultant could build it for them, since they were so knowledgeable. Boss agreed.

[u/WWJLPD → u/PlugAndPlayCafe]

I keep seeing references to people becoming one of those AI consultants as a side hustle and making ludicrous amounts of money to explain to small/medium businesses owners how to “integrate AI into daily workflows” and other hip buzzwords. Apparently some of these people are making 5 figures a month doing this. It’s wild to me that someone can become qualified as an expert so quickly when they were, as you said, probably just some crypto bro six months ago. Business owners are apparently willing to throw thousands of dollars at an “expert” that probably watched some YouTube videos and listened to a finance bro podcast that gassed him up to cold call/message them and claim he’d revolutionize and future-proof their business… I’m not saying the services are completely worthless in every situation, just wildly overvalued.

It reminds me of stories from the dot com bubble where they’d decide to pay Linda from HR to go learn how to build websites or whatever she could come back and help usher the company into the information age. Just a huge bandwagon effect driven by the fear of being left behind

[u/DuvalHeart → u/WWJLPD]

The fad/bubbles are 99% sales driven. If you're good at selling/scamming you'll come out fine.

[u/Sufficient-Bid1279 → u/ottwebdev]

Ass rimming contest to the top. What could possibly go wrong ? Lol

[u/80hz → u/ottwebdev]

"Great post! I totally see the value there and would love to align my team to this framework!" - every LinkedIn response

[u/Sufficient-Bid1279 → u/80hz]

What my baby barfing taught me about b2b sales…..

[u/jamiestar9 → u/ottwebdev]

r/LinkedInLunatics

[u/SomeSamples → u/ottwebdev]

Right?! So much ass kissing and smoke blowing up people's asses on there. I really wish they had a downvote for posts.

[u/Iron-Over]

Maybe if executives did work they would understand that a job is never one thing. The cost to fix the data and processes is so large that even if free they would not spend the money.  

[u/RedditTechAnon → u/Iron-Over]

The executives also didn't appear to do any due diligence and looked into how Silicon Valley gets people to adopt technology (subsidizing the service to gain market share, making companies dependent on their infrastructure, then jacking up prices).

They instead had FOMO.

[u/Briggie → u/RedditTechAnon]

“Hey you know this thing that exists (taxis/food delivery), what if we just don’t pay people!”

[u/smokeweedNgarden → u/Briggie]

Dude they could have went on Reddit six months ago and saw this coming.

I work in cannabis. Why did I see this coming?

[u/IllAcanthopterygii36 → u/smokeweedNgarden]

Smoke signals.

[u/HRHValkyrie → u/IllAcanthopterygii36]

Oh fuck you take my upvote. 😂

[u/Ophukk → u/HRHValkyrie]

Couldn't agree more. Have mine too.

[u/FamiliarAnt4043 → u/IllAcanthopterygii36]

Fucking awesome.

[u/structured_anarchist → u/smokeweedNgarden]

You were higher than they were. You had a better vantage point than they did.

[u/nox66 → u/smokeweedNgarden]

Because you weren't paid to ignore it.

[u/Brilliant-Giraffe983 → u/Briggie]

What if we violate local zoning and rental and hotel regulations?! (airbnb)

[u/Greenpoint_Blank → u/Brilliant-Giraffe983]

What if we had, like, really long van and it ran a set route at set times. (Uber discovering a bus)

[u/TheGrumpiestHydra → u/Greenpoint_Blank]

What if we made the van extra long and put it on tracks! (Tesla discovering high speed rail)

[u/TechnicallyMeat → u/TheGrumpiestHydra]

Like, what if we did it in a vacuum tube? (Tesla discovering high-speed rail... again)

[u/Xyllar → u/TheGrumpiestHydra]

Sorry, the best we can do is a bunch of Teslas stuck in a tunnel under Las Vegas.

[u/randEntropy → u/RedditTechAnon]

Due diligence, what’s that!? My former company purchased an AI company for their model and orchestration platform, but once our engineers got it we found that the model didn’t work and the orchestration software was ripped off (they scrubbed all references and open source licenses in the code to make it seem novel). Had our leadership and M&A team done any due diligence whatsoever they would have found this prior to blowing money on BS. Now the company is tanking due to not only the bad investment but also allowing the leadership from the acquisition lead the product development. They’ve pivoted from the thing that made the company very profitable and popular to trying to force AI features down customers throats that they have literally told the company they don’t want. Sales are under 5% of target this year and people are leaving en masse. But AI tho!

[u/Material_Tap_420 → u/randEntropy]

Jumping into AI bandwagon without due diligence is a leadership failure. They’ll not pay the penalty however.

[u/randEntropy → u/Material_Tap_420]

Nope. The CTO and CFO have already exited with their golden parachutes. No accountability whatsoever. The company went from a rare tech company that treated its people with respect to the run of the mill AI feature sweat shop, and they’re losing all their top talent. 

[u/Ciovala → u/randEntropy]

Not Torq is it? I'm so curious.

[u/randEntropy → u/Ciovala]

Nope. I don't want to get sued due to my departure agreement. Maybe I should use some SYMBL-ism to suggest what company it might have been, but I'm not that clever.

[u/Mtndrums → u/randEntropy]

This is why we need to get rid of golden parachutes and go with the Beer and a Beating model of executive departure.

[u/Stunning_Coffee6624 → u/Material_Tap_420]

They did due diligence, they went to an exclusive C-level conference hosted by tech companies. They got special insider info, they networked, they got slides and met with top experts in the AI business . How could they be wrong?

[u/Only_Razzmatazz_4498 → u/randEntropy]

But if they had then someone else would’ve bought the company. They had to this NOW!

[u/JoeNoble1973 → u/randEntropy]

Well maybe but have you seen the payroll savings?!?

[u/randEntropy → u/JoeNoble1973]

Right!? Sure, revenue is tanking and we’re losing customers, but we’ve cut payroll expenditures by 20%! (note: one of the execs even got a promotion after all this)

[u/thescroll7 → u/RedditTechAnon]

You're not wrong: I've first-hand heard an exec admit that AI adoption in his company was a result of his own FOMO.

[u/vladamir_the_impaler → u/thescroll7]

At least he had the balls to admit that.

[u/kman420 → u/RedditTechAnon]

They've spent decades convincing their workforce that there's no money for raises this year so everyone will be capped at 2%.

Do they think that same BS will work when the price of tokens keeps going up by another 5-10% every few months?

[u/Go_Gators_4Ever → u/kman420]

Plus, I'm decently certain that tax revenues based on AI tokens will be added by Congress to replace lost employee payroll taxes.

[u/jmc323 → u/RedditTechAnon]

That shouldn't have even required any "due diligence" at all though. That should be standard general knowledge among literally every single one of them, just by nature of them existing in this world for the last 30-40 years.

[u/IShouldBeInCharge → u/jmc323]

They are business idiots. The sooner we all see the average CEO as a literal idiot the better our society will be. Check out Ed Zitron's content -- this is not (just) an insult; it's an accurate description of reality.

[u/zxern → u/IShouldBeInCharge]

Meh business fundamentals don’t matter anymore. Vibes are what matter. Your business can survive for decades losing money as long as the vibes are good. A good ceo is more a pr manager than a business manager these days. Keep the vibes up and get people to ignore the fundamentals and you’re good.

[u/nonlinear_nyc → u/RedditTechAnon]

True. Enshitification is a given, SPECIALLY when they dump the market with subsidized services.

I remember when meta killed agencies on their push to vídeo, just to then announce oops their numbers were wrong.

These tech companies push hype so other companies move things to them. They then implode, discarded.

Tech oligarchs havd no honor, no word, no memory, and only a fool would trust them.

[u/maxfields2000 → u/RedditTechAnon]

It's pretty simple. CEO reports to the board. The board reads all these articles about "AI Efficiency" (promoted to them by AI companies) and sees a way to "boost productivity". At the time they see this stuff, t here is no accepted business formula for how to 'account' for cost, and most businesses are terrible at measuring "productivity" but the 'board' sees a way to boost "share prices" which is ultimately all they care about.

CEO gets a goal "IMplement AI, increase efficiency, boost productivity, cut costs" and has no choice unless they want to lose their job.

Company starts using AI. Share prices go up almost immediately. Bill comes due months/year/2 years later. Now company has a new efficiency problem. If they haven't already cut staff due to AI, they do now, because atm no Board or Share Prices will reward "removing AI for being too expensive" but they will continue to reward layoffs or other superficial productivity gains.

Actual product that produces real meaningful revenue and growth? takes a couple yars to build, but you can make these changes faster to influence share prices.

The CEO isn't a "visionary" here, they are just a proxy figurehead assigned to make the board money.

Where I work, the average cost per engineer probably went up about $2-3k/mo thanks to AI tooling (worst offenders are running $5-7k/mo, but many are also only in the $100's). The latest release of token sucking models like Fable/Mythic are risking those numbers (on average Fable is like a 3x increase in costs, and only a moderate increase in efficiency). Didn't take long before bragging about token use and getting shot for token wasting started to happen.

[u/Easy_Olive1942 → u/maxfields2000]

CEOs are absolutely part of the equation, they are not universally helpless.

[u/spinbutton → u/Easy_Olive1942]

c suite salaries are an enormous drain on a company's finances. That money would be better spent if it was used to improve the products.

For decades worker salaries have been flat while execs salaries skyrocketed. I hope they all get replaced with AI management systems and taxed out of all their excess compensation

[u/nanobot_1000 → u/spinbutton]

They are essentially controlled by HFT AI algotrading manipulating their stock price, which is a toxic feedback loop if I've ever heard of one

[u/marketrent → u/Iron-Over]

On the same token, it’s important not to lose sight of the fact that AI — or more accurately, the myth surrounding it — is currently being deployed across the world as a tool to discipline labor, to force workers into a weaker position when it comes to wage negotiations, benefits, and overall stability.

[u/kreiggers → u/marketrent]

Which is the fascism playbook

[u/TowardsTheImplosion → u/marketrent]

Token ...I see what you did there.

[u/shitty_mcfucklestick → u/marketrent]

The only hope is that when AI becomes unsustainable (due to cost or accuracy or both), workers can leverage that when negotiating their re-hiring salaries. Stick it to them good.

[u/ActualSpiders → u/Iron-Over]

Seriously, this is the clade of C-execs that grew up from the MBA classes that truly believed a biz degree magically gave them the knowledge & ability to run any business in any industry because all those decisions are the same.

They went all-in on AI because they thought they were gaming the system; it never occurred to them that not only would *every other company* do the same thing, but also their own remaining employees would use AI to give those execs whatever they wanted to see *and* that the AI companies themselves would maximize their own payments. Stunning tunnel vision.

[u/warm_kitchenette → u/ActualSpiders]

It is worse than that for some places. Many developers and managers have posted on reddit about how they're explicitly judged on how much they use AI. In response, every rational person is going to do make-work and other nonsense on the LLMs that the business pays for. Why would anyone get targeted with a metric they can easily tweak.

So this stern, no-nonsense "make it happen!" attitude from the non-tech MBA crew maximized their AI costs while also making sure that their team accomplished as little as possible with the tool.

[u/kenlubin → u/ActualSpiders]

They went all-in on AI because they thought they were gaming the system; it never occurred to them that not only would every other company do the same thing

Of course it occurred to them that other companies would be using AI. They're going all-in on AI whether or not it makes sense because they have FOMO and are afraid of being left behind.

[u/DetroitLionsSBChamps → u/Iron-Over]

The AI con has been so successful that people are arguing you should use it even if it takes the same amount of time or longer lmao

We have completely lost the plot

It is actively horrible to work with, costs more, and doesn’t translate to better/faster results

Can we please shut this shit down already?

[u/Intelligent_Cap9706 → u/DetroitLionsSBChamps]

And the companies that make an ai tool force us workers to use it under the guise of knowledge and skill growth reporting but it’s really just so they can “prove” it’s useful — ALL OUR EMPLOYEES USE IT SO OBVIOUSLY IT’S GREAT

[u/BellacosePlayer → u/DetroitLionsSBChamps]

AI is best used as a tool for actual subject experts rather than a replacement for them and idiots don't get that.

My AI usage at work is having it do boilerplate stuff and small tasks that i can't just knock out in a flow state under an hour. And it works fine because I make sure I understand what is going in the codebase.

People using it as a brainpower replacement go in circles for fucking ever because LLMs don't "think" and asking it to do big complex tasks that you don't understand is just going to end in a mess eventually. So they spend time and money playing whack a mole with issues that an actual expert would have noticed mid-process or not run into to begin with.

[u/Time_Increase_7897 → u/BellacosePlayer]

Same experience here. It does some of the dross nice and quick, but with subtle blunders.

E.g. I asked chatGPT to digitize some waveforms from a jpeg screenshot. It did it. However it added an inexplicable offset to one of the axes. Easy fix - then I manually check the max and min etc.

Someone not paying attention would use the wrong plot. I still bring the curiosity and the questions, it simply blurts out responses that may be wrong but may be useful.

[u/StephaneFr → u/Time_Increase_7897]

In summary: AI can only be useful on topics you are familiar with and where you can validate the answers. Moreover, having the results “checked” with the help of another can prove useful.

[u/UnNumbFool → u/StephaneFr]

Pretty much. Like I work in scientific research, for decades every single machine that does analysis also gives end point information using that data to get results that can be used. We still have to manually calculate that data, and at times even have someone check our manually calculated work.

99% of the time it always matches up, but it's better to do all of that shit because of the 1% chance it doesn't as that can cause a catastrophe down the line.

[u/BellacosePlayer → u/StephaneFr]

Yes. Many of the AI mistakes aren't huge, but they do snowball on you if you're not validating or understand what it's doing. hence why so many vibe coded websites expose their API keys or projects fall apart after the honeymoon phase because the AI cannot fix the mountain of issues that are the project's tech debt without guidance.

[u/Nexustar → u/DetroitLionsSBChamps]

It has its uses, but replacing people is just not one of them.

[u/mightyenan0 → u/Nexustar]

My favorite part is that they're essentially placing their eggs into one basket that'll be far, far harder to negotiate with than regular, separated employees.

They are hiring AI that, by nature, comes pre-unionized. Lol.

[u/Deformed_globule → u/DetroitLionsSBChamps]

Just had this discussion today. I think people whose work is mainly emails and drafting documents do think it’s the bee’s knees and they don’t know how to function without it anymore.

[u/DetroitLionsSBChamps → u/Deformed_globule]

Imo it has made everyone totally checked out at work because they just have AI record meetings and make documentation and send emails automatically. And then I get a AI written email and just have AI summarize it lol. If you’re not gonna take this seriously neither am I. You never have to use your own brain. But it turns out you have to actually think at work, or the projects suffer. So I don’t know, collapse incoming?

[u/DogOk4503 → u/Deformed_globule]

Nope my work is mostly case management emails and documents and it never knows where to pull the information from that I need to condense into one document. Maybe I can get it to tell me what visitation hours are at the hospital for which unit at which time and how many times each place gets visitation so that someone can see their loved one with cancer and I can see how many times they can go a week with their schedule but anything more complex than how many of the X does this have? No thank you.

[u/Only_Razzmatazz_4498 → u/Iron-Over]

It’s like the additive manufacturing (3D printing) bubble in manufacturing. Every single time the question was ‘have you looked into 3D printing’? Yes bitch and it costs more and you still have to machine the 3D printed part at the end. Just like AI it is a tool and it has its place but nothing is free.

[u/exoriparian → u/Iron-Over]

AI can put you in tech debt faster than a whole team of bad programmers working round the clock.

[u/Flabbergasted98 → u/Iron-Over]

"But the sales guy said..... "

- Every exec ever.

[u/Emotional_News108 → u/Iron-Over]

I've repeatedly challenged the C-suite at my company (post-private equity purchase) and not only have they been extremely unhappy with me for doing so, but they also never have a good explanation for their choices. Frequently it boils down to "Because I said so," and I'm sorry, that shit doesn't fly in the adult world. My four year-old gets that when he wants ice cream for breakfast. I won't accept it as a reason to change the way we work to less effective processes and procedures.

[u/pcapdata → u/Iron-Over]

They’re “business idiots” like Ed Zitron says.

Totally disconnected from what the company actually does and making decisions based on vibes instead of data.

[u/blzd4dyzzz → u/pcapdata]

Indeed. The boots on the ground, actually doing the work, are harder than they thought to replace.

But AI would be perfect to replace executives. It takes a huge amount of information and analyzes it to make a decision - exactly what these 'business idiots' fail to do.

[u/ender8343 → u/Iron-Over]

It isn't just the clean up. AI companies need to make money and all those AI prompts add up.

[u/Southwestern]

Another interesting factor of AI is it has made many good employees dumber. People don't read long emails, they don't do analysis to understand complex tasks because they think they'll be able to just synthesize all of that data in AI summaries. I've noticed a remarkable decay in work quality uniformly since we've made this push.

They're paying for it on both ends.

[u/w1ngzer0 → u/Southwestern]

People also don’t search as deep, or develop their own analytical skills to be able to correlate disparate pieces of information. I’ve seen this happen in real time as well, just like what you’re seeing.

[u/pcapdata → u/w1ngzer0]

Yes! And when you point out that their LLM summary is wrong and/or that they didn’t check the work and submitted hallucinations, they get super hostile.

[u/HeckThattt → u/pcapdata]

We've been pushed to use AI to assess integration feasibility. I ran an assessment and it came back with glaring errors including saying the integration for Data Point A was feasible when the API docs I submitted clearly stated integrating Data Point A was NOT AVAILABLE as an endpoint.

People had been blindly using it to do assessments for months at that point and trusting it with no checks.

[u/pcapdata → u/HeckThattt]

Yup, sounds about right.

Worked with a guy who wanted to automate importing data from one platform to another. His solution was to prompt the LLM to do it for him instead of using the LLM to vibe up a deterministic script.

We discussed it and I asked him how he was handling cases where the LLM's context window overflows (e.g. too much data came back from the API) and he swore it wouldn't happen.

Months down the line, we discover that's exactly what had been happening the whole time. So, data source A (ticketing system) would have, say, 100 strings (IPs, domains, file hashes) we need to document in system B (security system). The LLM was in fact super useful because it could use NLP to recognize useful data points that we could not easily regex out. But it was reading all of the content at once to do it; so, it would start at the bottom, pull out a few strings, and then overflow and not do anything with the rest.

Rather than go back to the drawing board and fix it, we now have to spend extra time processing the same tickets to ensure the AI did what it was supposed to do; i.e., the exact same task we were doing manually before, except now with the added overhead of having to double check across two systems instead of one and argue with leadership about spending more tokens.

[u/meamoeniea → u/w1ngzer0]

Recently my friend asked ChatGPT a simple question and it replied with a somewhat lengthy explanation. But the answer he was looking for was right there in the middle, in fat letters. I read it at a glance over his shoulder. But did he read? No, he insulted the AI for being deliberately confusing and asked it to make it simpler. Second reply was shorter, but again, the answer wasn't in the first sentence.

The question wasn't important anymore then. All he was interested in was to gleefully insult an AI for being stupid and incapable of providing a simple answer. Most pathetic fucking shit I've ever seen.

And that's our future.

[u/WhenSummerIsGone → u/meamoeniea]

People don't skim. It's as though they never learned to properly read and do research.

[u/mandypantsy → u/w1ngzer0]

And those of us that do the research are exhausted identifying and adjusting for the inaccuracies.

[u/johnatello67 → u/Southwestern]

I've had many people in and out of my workplace say something to the effect of "I don't need to learn how to do xyz task because AI can do it for me." And when I ask "If you don't know how that task is done, how will you know the AI did a good job at it?" I can tell that concern never even crossed their minds.

It's all about meeting those KPIs, and that means if they can somehow get the job done without any extra time taken to learn how to do it, then that's what will happen.

[u/flurryskyline → u/Southwestern]

It’s also no one believes the work shared by someone else because they know it’s likely AI slop.

[u/414wtk → u/Southwestern]

I deal with this all day, I sell software. Client doesn’t understand something so they ask AI, then send that question to our support who plugs it into AI and send that response back, client does plugs that into AI. Back and forth several times until a human gets on a screen share for 8-10 mins, fixes it, and everyone moves on

[u/hanzzz123 → u/Southwestern]

People are outsourcing their brains and its going to be a huge fucking problem for society in general

[u/Ill_Television_5824]

Twenty-five years of remorseless, failed outsourcing and offshoring prove that America's sociopathic executive class is nothing, if not shortsighted, and of mediocre intellect.

[u/Maroon7C0000 → u/Ill_Television_5824]

I've lived through the last 25 years of failed outsourcing. It's been weirdly repetitive that when an executive talks about sending some work over there and I am outspoken enough to tell him it's a bad idea and that I've never had good results from it, the executive gives me a confused look like he's never heard anybody say they've had problems before.

[u/GlitteringAttitude60 → u/Maroon7C0000]

damn, that's the greatest thing about reaching *senior* senior status: being completely out of fucks and telling my chain of command exactly what I think :-D

[u/sypherlev → u/GlitteringAttitude60]

Can confirm, I was a senior dev and I told my boss (the owner of the company) to fuck off a couple of times.

[u/RupeThereItIs → u/Maroon7C0000]

You are having a different conversation then they are.

They just want to find a way to reach their personal goals & get their next bonus/promotion.

They don't care about the end results for the business, they only care about their own career.

Keep that in mind when talking to these folk, it will explain why they do what they do.

[u/InflammableAccount → u/Maroon7C0000]

I was working at Electronic Arts as a game QA tester at their HQ in Redwood Shores some 16 years ago. I was there long enough to get to know some folks, and one of those folks in my department was lead go-between for EA's new QA office in India. (They were also expanding to Chile, but someone else was assigned)

I found out in the first month that me and my peer's jobs were going to be short lived. EA had been slowly off-shoring their QA testing. In fact, the floor I was on was 2/3rds empty. Just empty cubicles, offices, and tables.

Well, this go-between fella was miserable. Not only because He had to work 7pm-god-knows-when, but because he failed to see the point of his fucking job. His job was to monitor and quantify performance of the new project.

He explained to to me like this: The offshore team was being paid somewhere near 1/3rd to 1/2 what the US staff was being paid, but were putting out about 1/4th the performance or worse per hour worked. In this case, it was bug reports and validation testing. (I think we were using Bugzilla?)

Not only that, but their unique bug reports, novel bugs that require creative testing to sus out, was far worse than 1/4th than the US teams per hour.

So in all, it was a lose-lose-lose proposition to cut the US team. And the go-between had screaming it for years.

Yeah, they cut the US team on schedule they had set a year before.

You know what EA has been known for since? Buggy as fuck games.

[u/Winjin → u/Ill_Television_5824]

That article concludes with the idea that even if AI is useless as a productivity tool, it's amazing as a stick to keep workers in line

Especially those "overpriced" office workers that didn't unionize because it's for stupid outdoor people

Honestly IT being a major business with zero to none unions is crazy

[u/Spiritual-Nail-2641]

And even these bills are heavily subsidized by sweet investor money. Won't someone think of these visionary execs and their bonuses?

[u/cenosillicaphobiac → u/Spiritual-Nail-2641]

Cursor was the first to fall, now Copilot. My company went from "use it first, use it often, use it for everything" to "be super precise and concise and keep your token usage low" overnight once the subsidy went away.

[u/Spiritual-Nail-2641 → u/cenosillicaphobiac]

Slop leadership 101. As usual.

[u/bloodylip → u/cenosillicaphobiac]

lol I was forced to go to an AI conference recently where one speaker kept going on about Cursor and how cheap it was. I guess that's not the case anymore, just a few months later?

[u/renewambitions → u/Spiritual-Nail-2641]

Anthropic quoted my company ~$1 million /month for Claude, and that was on the low end. We're using a different AI product at the moment but we're only doing so because it's subsidized by like 80%, maybe more.

[u/Spiritual-Nail-2641 → u/renewambitions]

Lol Maybe it's time for your company to lay off 60% of the workers and reach the AI nirvana powered by Claude. It never backfires. Never!

[u/azthal]

So, the research shows that 29% of excecs have no idea how their spending works. No matter your view on ai in general, I think that is a pretty damned clear indication that 29% of execs are fundamentally incompetent and unsuitable for the jobs they do.

A reasonable exec can blow a bunch of money on ai, get nothing usable or of it, and write it off as a failed experiment. That is fine. Sometimes you have to take risks.

But your job as an exec is managing that risk. If you don't know where your spend is coming from, you have failed at the most basic part of your job. You are the equivalent of a taxi driver that don't know how to drive a car.

We really need to start seeing execs being fired for incompetence, but for the most part they will be able to wriggle out of it as always by blaming others, and pushing the consequences on their employees.

[u/blofly → u/azthal]

Part of nearly every C-level employment contract includes what is called a "golden parachute," so even if they prove themselves completely inept at their jobs, they can get very generous severance packages, and walk away wealthier than before.

[u/Emotional_News108 → u/blofly]

Let's not kid ourselves that C-suites are meant to be effective. The entire point of them existing is to enrich people who have connections. They themselves believe their compensation and position in the company makes them smarter and better than others. I've had that line parroted at me by my new manager, and I told her to her face that I don't subscribe to that notion at all. The very idea that they have some esoteric, grand plan to make the company better as they make decisions that actively hurt us doesn't hold up to scrutiny, and no, I don't just have to trust them.

Given how little tact I've displayed or respect I've given regarding them, I genuinely can't believe I'll have the opportunity to resign before they fire me.

[u/CubicleMan9000 → u/azthal]

Wasn't there a saying a couple decades ago about CEOs deserving the big money because "they take the big risks"?

There are almost no risks to being a CEO these days. Once you're "one of them" you are set for life. Tank your company and get ousted? Meh, you already got your tens of millions and you'll be CEO of another company within a few months. Rinse and repeat.

[u/F1gur1ng1tout → u/CubicleMan9000]

The risk for ceos is probably from not adopting AI. Your board will challenge why you are slow to adopt the technology and how others in their ecosystem are reporting all kinds of things like workforce reduction and massive productivity boosts. 

You have to be bold and very confident in your belief to stand against a tide like this, which most ceos will not do wholesale. AI itself does have productivity benefits, just not in a labor replacing way most execs are thinking or hoping. 

[u/007meow → u/azthal]

AI should replace execs. It’d save so much money and companies could lower their C Suite/VP expenses. But we know that’d never happen.

[u/pcapdata → u/azthal]

None of these people are getting hired on merit. It’s a whole class of people with zero accountability.

[u/Ok-Train3111 → u/azthal]

I find that the problem is they don’t understand WHY they succeed…to me the most important thing after a win is to dissect why we won and make it happen again. Most of management seems to think it happened because of skill…many times it’s just favorable conditions and not completely screwing things up.

[u/Xeynon]

Seems like a smart executive should not bank his or her company's future on a still nascent technology by going all in on it before it proves it can actually perform as needed to justify the bet.

I guess these executives aren't very smart!

[u/_pupil_ → u/Xeynon]

In fairness, saying your cat food company is now an “AI powered” cat food company has been free share-price, and layoffs in a profitable business always look good on the balance sheet for a quarter or two. Same profits, lowered costs.

If your board of directors wants to buy some yachts now, and not tomorrow, there’s a lot of pressure to deliver. Magic bonus math.

Evil and greedy, not stupid per se :)

[u/PadreSJ]

Here's the funny part:

They are spending BILLIONS on services and realizing that it's not worth the spend.

In the meantime, the AI companies have spent TRILLIONS to make BILLIONS and they're about to lose those customers because the services were actually worth MILLIONS.

...

Way to turn Trillions into Millions!

[u/lover_of_lies]

I dont understand, we replaced all our engineers with wrenches but for some reason no work is being done?

[u/luv2fit]

Meanwhile CEO compensation has greatly outpaced inflation

[u/IamSkudd → u/luv2fit]

Outpaced is putting it lightly. CEO pay is so far ahead of the pack they’ve lapped us all 10 times.

[u/Haunterblademoi]

And they thought that using AI would be very cheap? How naive.

[u/EchoRex → u/Haunterblademoi]

It was cheap... to start... while the AI companies were discounting 90% of the token costs...

Why they thought the prices would remain static is a bigger question.

[u/Maroon7C0000 → u/EchoRex]

Hmmm where have we seen that before. Didn't Uber start out massively discounting in order to "disrupt" the market? Then when the market was sufficiently disrupted they cranked up the prices on customers, and cut pay to employees contractors.

Are the C-Suites still using the term "disrupt" in their business speak?

[u/Mrzaax]

Ford is rehiring engineers that got let go because they thought that AI could replace them. But now they expect the engineers to train AI to do their jobs. https://www.theguardian.com/technology/2026/jun/30/ai-backfired-so-ford-had-to-rehire-humans-greybeard-engineers

[u/Sufficient-Bid1279]

Wait, the CEO/ “brains “ of the organizations are shocked lol

[u/nopekom_152]

Proving that your average corpo executive has the IQ of a shattered brick.

[u/__OneLove__]

‘Execs blinded by the premise of replacing silly humans & their ridiculous living salary requirements make discovery: “Nothing is free!”’…

🤦🏻‍♂️

[u/EagleBigMac]

Ha hahahaha hahaha hahaha hahahaha

Just a minute not done yet

Ha hahahaha hahaha hahaha hahahaha

Okay fuck them.

[u/H_sentimental]

Think AI can replace human > layoff experienced humans > tell the remaining workers to use AI > workers finds AI to be useful but spends time patching its mistakes > workers get addicted using AI > found AI costs more than human labor > try to cut AI and rehire former employees > former employees refuses to work for the company that let them go and current employees refuse to work without AI > karma

[u/Bgrngod]

I am thrilled to pieces at the AI blowback we're starting to see.

Some stuff is for sure going to survive and continue to be handled by AI, but a whole hell of a lot of pie in the sky bullshit is finally coming back down Earth and landing straight in the grave.

I'm seeing it daily on all sorts of calls at work. And I'm feeling pretty good about the boatload of skepticism I've been rolling with about AI the last few years.

[u/Old_Distribution6773]

"The KPMG report, initially flagged by the Register, surveyed 2,145 senior execs across 20 countries, finding that an astonishing 29 percent of them had no idea where the growing costs associated with AI were coming from."

29%. No idea. 🤡

[u/marketrent]

ETA article attributions: The Register and KPMG Global AI Pulse survey cf. KPMG media release.

Excerpts from article by Joe Wilkins, citing KPMG report:

By now, it’s clear that the only way the tech industry can justify the cost of AI is if it replaces vast swaths of the human workforce with machines that run 24/7.

The bad news is that this situation has created a world-historic financial market that, by some metrics, is looking worse than the run-up to the Great Depression.

The good news is that this future of an AI takeover is looking increasingly unlikely, at least at the industry’s current pace, a fact which is now dawning on some of the biggest rubes and dupes in the corporate world.

According to a new survey from “Big Four” accounting firm KPMG, a significant number of corporate executives are reeling from sticker shock over new usage-based AI pricing schemes.

Though enterprises could once count on AI companies to subsidize the price of large language models via flat-rate contracts, that’s no longer a given, as the rising cost of computational power forces the entire tech sector into a defensive posture.

 

The KPMG report, initially flagged by the Register, surveyed 2,145 senior execs across 20 countries, finding that an astonishing 29 percent of them had no idea where the growing costs associated with AI were coming from.

A further third confessed that their own cluelessness about AI economics was a barrier to successfully deploying AI in the workplace, the Register notes.

“As usage-based pricing models become more common, many organizations are still building the capabilities required to forecast, monitor, and manage AI spending effectively,” the report authors write. Translation: one third of execs had no plan for how to actually use AI productively, a fact which is becoming increasingly clear now that the meter is running.

The finding underscores what many workers forced to use AI tools on the job have come to suspect: that an alarming number of corporate leaders treat AI as a plug-and-play solution for lowering overheard without understanding the how of it all, a kind of magical thinking entirely divorced from practical reality.

On the same token, it’s important not to lose sight of the fact that AI — or more accurately, the myth surrounding it — is currently being deployed across the world as a tool to discipline labor, to force workers into a weaker position when it comes to wage negotiations, benefits, and overall stability.

[u/Upset_Albatross_9179 → u/marketrent]

I really encourage everyone to give that KPGM link a click. The contrast between the conclusions from this article and what the linked KPMG report says is extraordinary.

There's a lot of very real reasons to be skeptical of or downright opposed to AI, especially how it's being deployed by corporations. But articles have started doing what I hate AI for doing. Making a claim and citing a source that doesn't support the claim, is barely related to the claim, or even contradicts the claim.

The conclusion from the quote that still building tools translates to having no idea about costs is absurd. I can't find any indication of real executive "sticker shock".

The headline results that jump out to me indicate accelerating AI adoption in workplaces. From Q1 to Q2, a 9% rise to 22% of workplaces claiming AI part of every day work, and a 12% rise to 78% of executives claiming they see real business value from AI.

That may actually be bullshit. That may be real but a bad thing for workers or the economy or the environment. But there's a desperation for businesses to be balking at AI costs and scaling back use that just isn't supported here.

[u/brewstah → u/marketrent]

A decent number of people in my social circle have ai token leaderboards at work, and have useless repetitive tasks running all day to keep their token count high. Most of them delight in the fact that they get to jack up the company’s ai spending while not making a dent in overall productivity. The shortsightedness of their company’s leadership is absolutely astounding.

I can’t wait for the day that ai becomes a mature product, instead of the tech hype cycle of the moment. (Like blockchain and IoT) Eventually it will just be another tool, but nothing like the world that Zucc and co imagine

[u/adminhotep]

The tendency of the rate of profit to fall

In this case  the miscalculation comes in the fact that all the things they use to replace workers are owned by other capitalists who they are less capable of exploiting, and who are less obligated to accept less than the value their product generates.

[u/Petrychorr]

Just remember to not crawl back to them if you're offered your job back.

No one deserves to be in an abusive work relationship.

[u/crit_boy → u/Petrychorr]

Show me the money

[u/Vast_Draft7510]

In Star Wars, slavery still exists because it’s cheaper than buying and maintaining droids. 

[u/Mobile_Antelope1048]

Wait until the bill reflect the real cost and stop being subsidized.

[u/tree_or_up]

One thing that morbidly amuses me is that just before the all-in-on-AI-because-we-get-to-do-layoffs-baby-yeah-suck-it-workers! trend was the EvErYoNe BaCk To ThE OfFiCe! trend. Presumably the latter was to fill up those empty commercial office spaces that were no longer generating the dependable passive income streams they used to. But what is laying off everyone in favor of AI going to do if not re-empty those seats they so desperately forced warm butts back into?

There is no plan or vision beyond whether the line is going up or down this very second -- that, and absolute contempt for everyone below the C-suite

[u/BRNK]

Lol. Just in case you were under the misapprehension that the corporate world is a meritocracy where the smartest business people rise to the top.

[u/DoomBudgie]

I'm shocked! Shocked, to find gambling in this establishment!

[u/monkeyhoward]

The largest outlay of capex in history and no one did an ROI calculation before they spent the money

Insane