The AI Enshittification Bubble | Cory Doctorow

The AI Enshittification Bubble | Cory Doctorow – Hidden Forces

Market views

Bearish

OPENAI— OpenAI has terrible unit economics, losing money on every user and every use, with no path to profitability despite massive capital expenditures exceeding $150B annually.
ANTHROPIC— Anthropic faces the same structural unprofitability as OpenAI, with low switching costs meaning they must spend hundreds of billions on each new model to stay competitive.
AILABS— AI companies are structurally unprofitable with worsening unit economics each generation, dependent on unsustainable growth narratives that will collapse when investor capital runs out.
META— Meta lost $61B on metaverse and is now losing $150B+ annually on AI with no clear path to profitability, representing peak narrative-driven capital destruction.
SPACEX— SpaceX IPO'd at 100x sales valuation, requiring 100 years of current revenues to break even, with most 'AI revenue' actually just Twitter ad sales.
FOUNDATIONMODELS— Large foundation models have unsustainable operating expenditures that remain high even after capital costs, with inference costs hidden as marketing expenses on balance sheets.

Not investment advice.