Balaji on Why AI Raises the Cost of Verification
Episode publishedPodcast: The a16z ShowThe a16z Show
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AI doesn't take your job. AI makes you the CEO. The problem is AI is a shortcut, and a shortcut is good except when it's bad. If you don't know how to go the long way around, then you can't debug the AI.
Do we not think that AIs are just gonna be also better at taste and agency?
I don't think that's true on a short term basis. Humans are the sensor, AIC actuator. So it's like a human machine synthesis. What's taste? Taste is the sense, and that is what AI can't yet do. What happens
when AI really achieves its potential? Will LLM get us to AGI in some capacity?
No. No. Actually, on the opposite.
Every tool that makes creation cheaper makes verification more expensive. The printing press made publishing easy and forgery easier. Photography made documentation instant and manipulation inevitable. In 1839, the first year a camera could capture a human face, people trusted photographs absolutely. Within a decade, courts were already debating faked evidence. The cheaper the creation, the harder the proof. AI has compressed this cycle into months. A resume that once took hours to fake now takes seconds. A slide deck that signaled competence now signals nothing. The generation cost has collap
I wanna start by talking about the AI economy, and I'm curious if you think it will look more like the Internet economy where applications take most of the value or the cloud economy where there's kind of a infrastructure takes most of the value or it's more distributed. There's an argument that the big labs will take it all because they have all the capital. They have the compute. They've vertically integrated. But there's also an argument that, hey, maybe they won't because distillation is 98% cheaper than it is to build a model. Open source catches up, and apps, you know, control the user r
Great question. So I do think that at least a very large percentage of the future is gonna be distillation and decentralization. Because as Anthropic said, distillation attacks work on their thing. Right? And so a relatively small number of API queries helps to kinda distill a large model into something small. And it's very hard to stop that. Right? Because you're stopping queries from coming back. You'd have to somehow detect that or what have you. Right? And it's also hard to morally stop it because what do they do? They copy the whole Internet and put it into their thing. Right? So talking
Yeah.
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