AI is a deflationary technology, sort of like how most of the cost of TVs is the cost of shipping them from where they are made to where they are used. So wouldn't the returns show up in 'less work needs to be done' slowly over time?
The link to their referenced study doesn't seem to work?
This is confusing.. it's directly saying AI is improving employee productivity, but that's not leading to more business profit... how does that happen?
Why do I have a feeling that most of that $30B was spent on paying for consultants, most of which were also essentially making things up as they went along.
The funniest part isn’t that AI hasn’t delivered profits. It’s that the only “value” most people got from LLMs was accidentally rediscovering what Google used to be before it turned into an ad-riddled casino.
Executives mistook that novelty for a business revolution. After years of degraded search, SEO spam, and “zero-click” answers, suddenly ChatGPT spat out a coherent paragraph and everyone thought: my god, the future is here. No - you just got a glimpse of 2009 Google with autocomplete.
So billions were lit on fire chasing “the sliced bread moment” of finally finding information again - except this time it’s wrapped in stochastic parroting, hallucinations, and a SaaS subscription. The real irony is that most of these AI pilots aren’t “failing to deliver ROI” - they’re faithfully mirroring the mediocrity of the organisations deploying them. Brittle workflows meet brittle models, and everyone acts surprised.
The pitch was always upside-down. These things don’t think, don’t learn, don’t adapt. They remix. At best they’re productivity duct tape for bored middle managers. At worst they’re a trillion-dollar hallucination engine being sold as “strategy.”
The MIT study basically confirms what was obvious: if you expect parrots to run your company, you get birdshite for returns.
1 in 20 doesn't sound great. But you have to mediate that with
- everyone and their mother are doing a "generative ai program" right now, a lot of times just using the label to try to get their project funded, ai being an afterthought
- if the 1 out of 20 projects is game-changing, then you could argue right now people should actually be willing to spend even more on the opportunity, maybe the number should actually be 1 in 100. (The VC model is about having big success 1 in 10 times.)
- studies of ongoing business activities are inherently methodologically limited by the data available; I don't have a ton of confidence that these researchers' numbers are authoritative -- it's inherently impossible to truly report on internal R&D spend especially a private companies without inside information, and if you have the inside information you likely don't have the full picture.
We are entering the “Trough of disillusionment.” These hype cycles are very predictable. GPT-5 being panned as a disappointment after endless hype may go down as GenAI’s “jump the shark” moment.
It’s all fun and games until the bean counters start asking for evidence of return on investment. GenAI folks better buckle up. Bumps ahead. The smart folks are already quietly preparing for a shift to ride the next hype wave up while others ride this train to the trough’s bottom.
Cue a bunch of increasingly desperate puff PR trying to show this stuff returns value.
This is how America ends up being ahead of the rest of world with every new technology breakthrough. They spend a lot of money, lose a lot of money, take risks, and then end up being too far for others to catch up.
Trying to claim victory against AI/US Companies this early is a dangerous move.
In some products, certain AI features have become expected. If a product doesn’t include them, it risks losing customers, making it a net negative for the market. At this point, companies either invest in AI or risk falling behind.
No shit. AI is not "AI", its just a meme word for getting VC cash, because the original term (ML) did not raise any capital. Play stupid games, win stupid prizes.
What are the actual use cases that can generate revenue or at least save costs today? I can think of:
1. Generate content to create online influence. This is at this point probably way oversaturated and I think more sophisticated models will not make it better.
2. Replace junior developers with Claude Code or similar. Only sort of works. After all, you can only babysit one of these at a time no matter how senior you are so realistically it will make you, what, 50% more productive?
3. Replace your customer service staff. This may work in the long run but it saves money instead of making money so its impact has a hard ceiling (of spending just the cost of electricity).
4. Assistive tools. Someone to do basic analysis, double check your writing to make it better, generate secondary graphic assets. Can save a bit of money but can’t really make you a ton because you are still the limiting factor.
Aside: I have tried it for editing writing and it works pretty well but only if I have it do minimal actual writing. The more words it adds, the worse the essay. Having it point out awkward phrasing and finding missing parts of a theme is genuinely helpful.
5. AI for characters in video games, robot dogs, etc. Could be a brave new frontier for video games that don’t have such a rigid cause/effect quest based system.
6. AI girlfriends and boyfriends and other NSFW content. Probably a good money maker for a decade or so before authentic human connections swing back as a priority over anxiety over speaking to humans.
The biggest mistake people are making is treating AI as a product instead of a feature.
While people are doing their work, they don't think, "Oh man, I am really excited to talk with AI today, and I can't wait to talk with a chatbot."
People want to do their jobs without being too bored and overwhelmed, and that's where AI comes in. But of course, we cannot hype features; we sell products after all, so that's the state we are in.
If you go to Notion, Slack, or Airtable, the headline emphasizes AI first instead of "Text Editor, Corporate Chat etc".
The problem is that AI is not "the thing", it is the "tool that gets you to the thing".
I'm guessing every VC firm out there is hoping that they'll be the ones that picked the winners - the AI companies that will rule the world in N years.
For the future I will relabel "AI" as "Ain't Interested".
But despite the missing return of investment, it only needs a manager or a few, invested enough. They will push layoffs and restructuring regardless of better advice.
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[ 4.7 ms ] story [ 57.1 ms ] threadThis is confusing.. it's directly saying AI is improving employee productivity, but that's not leading to more business profit... how does that happen?
Executives mistook that novelty for a business revolution. After years of degraded search, SEO spam, and “zero-click” answers, suddenly ChatGPT spat out a coherent paragraph and everyone thought: my god, the future is here. No - you just got a glimpse of 2009 Google with autocomplete.
So billions were lit on fire chasing “the sliced bread moment” of finally finding information again - except this time it’s wrapped in stochastic parroting, hallucinations, and a SaaS subscription. The real irony is that most of these AI pilots aren’t “failing to deliver ROI” - they’re faithfully mirroring the mediocrity of the organisations deploying them. Brittle workflows meet brittle models, and everyone acts surprised.
The pitch was always upside-down. These things don’t think, don’t learn, don’t adapt. They remix. At best they’re productivity duct tape for bored middle managers. At worst they’re a trillion-dollar hallucination engine being sold as “strategy.”
The MIT study basically confirms what was obvious: if you expect parrots to run your company, you get birdshite for returns.
In this case, that's NVDA
- everyone and their mother are doing a "generative ai program" right now, a lot of times just using the label to try to get their project funded, ai being an afterthought
- if the 1 out of 20 projects is game-changing, then you could argue right now people should actually be willing to spend even more on the opportunity, maybe the number should actually be 1 in 100. (The VC model is about having big success 1 in 10 times.)
- studies of ongoing business activities are inherently methodologically limited by the data available; I don't have a ton of confidence that these researchers' numbers are authoritative -- it's inherently impossible to truly report on internal R&D spend especially a private companies without inside information, and if you have the inside information you likely don't have the full picture.
It’s all fun and games until the bean counters start asking for evidence of return on investment. GenAI folks better buckle up. Bumps ahead. The smart folks are already quietly preparing for a shift to ride the next hype wave up while others ride this train to the trough’s bottom.
Cue a bunch of increasingly desperate puff PR trying to show this stuff returns value.
Here's the source report, not linked to by this content farm's AI-written article: https://mlq.ai/media/quarterly_decks/v0.1_State_of_AI_in_Bus...
Trying to claim victory against AI/US Companies this early is a dangerous move.
1. Generate content to create online influence. This is at this point probably way oversaturated and I think more sophisticated models will not make it better.
2. Replace junior developers with Claude Code or similar. Only sort of works. After all, you can only babysit one of these at a time no matter how senior you are so realistically it will make you, what, 50% more productive?
3. Replace your customer service staff. This may work in the long run but it saves money instead of making money so its impact has a hard ceiling (of spending just the cost of electricity).
4. Assistive tools. Someone to do basic analysis, double check your writing to make it better, generate secondary graphic assets. Can save a bit of money but can’t really make you a ton because you are still the limiting factor.
Aside: I have tried it for editing writing and it works pretty well but only if I have it do minimal actual writing. The more words it adds, the worse the essay. Having it point out awkward phrasing and finding missing parts of a theme is genuinely helpful.
5. AI for characters in video games, robot dogs, etc. Could be a brave new frontier for video games that don’t have such a rigid cause/effect quest based system.
6. AI girlfriends and boyfriends and other NSFW content. Probably a good money maker for a decade or so before authentic human connections swing back as a priority over anxiety over speaking to humans.
What use cases am I missing?
While people are doing their work, they don't think, "Oh man, I am really excited to talk with AI today, and I can't wait to talk with a chatbot."
People want to do their jobs without being too bored and overwhelmed, and that's where AI comes in. But of course, we cannot hype features; we sell products after all, so that's the state we are in.
If you go to Notion, Slack, or Airtable, the headline emphasizes AI first instead of "Text Editor, Corporate Chat etc".
The problem is that AI is not "the thing", it is the "tool that gets you to the thing".
For example a study from METR found that developers felt that AI sped them up by 20%, but it empirically it slowed them down by 19%. https://metr.org/blog/2025-07-10-early-2025-ai-experienced-o...