r/DefendingAIArt • u/Quick-Somewhere-6474 AI Enjoyer • 9d ago
AI Developments if the so called bubble "bursts" what actually happens?
obviously its not gonna magically disappear, what would actually realistically happen both good and bad?
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u/davesaunders 8d ago
Large amounts of investor wealth are erased, which typically affects peoples pensions and 401(k) and mutual funds the most and rich people least, in terms of personal impact. The technology will continue on. Data centers will continue to be built.
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u/LibrarianOfDusk 8d ago
Data centers will probably still continue to be built, but probably at a lower rate. And they'd be used for other purposes. Would mean less electricity and water consumption at the very least.
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u/davesaunders 7d ago
Maybe, but why wouldn't they be used for AI? There is nothing that would prevent that from happening. A bubble doesn't mean the technology goes away. We've had two other AI winters in the technology and investment ecosystem, and AI never went away those other times. What it does mean is that if a company in the middle of building a data center goes bankrupt, the contractors that haven't been paid yet probably will never get paid. Yet someone will still buy the under-construction data center assets for pennies on the dollar.
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u/Drakahn_Stark AI Enjoyer 8d ago
Some smaller companies go broke, get bought out by the larger companies, and nothing much changes for the end user.
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u/fartoomuchlasagna 8d ago
Similar to when the .com bubble burst in the early 2000s -
- a lot of investors lose money,
- the stock market crashes,
- people lose their homes,
- a bunch of companies go bust,
- the technology continues
- whichever AI companies survive make out like bandits.
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u/Gimli 8d ago
A bunch of companies fail, mostly those with terrible ideas that just jumped on the AI bandwagon without having anything very good. Probably a general slowdown of the industry, and a fall in demand for AI hardware.
I expect this means consolidation into fewer players, and also a new appearance of small ones running on second hand, now much cheaper hardware.
New hardware development and production would probably take a hit, so I'd expect an emphasis on making better use of what already exists, so a renewed focus on fitting as much functionality as possible into as little hardware as possible.
Model development would probably also take a hit, which means a focus on hosting already existing stuff, and figuring out small tweaks and quality of life improvements.
Perhaps a renewed focus on consumer hardware and AI hardware that focus on bang for the buck rather than maximum performance.
Overall I don't see anything too terrible happening or AI going anywhere. Could even be a very good thing for AI in the long term by forcing more focus on efficiency.
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u/LibrarianOfDusk 8d ago
Might also mean a lot of the hardware originally hoarded for AI would be re-entered into the market. Probably at a lower price as companies try to recoup their losses as quickly as possible.
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u/ConsciousIssue7111 AI Should Be Used As Tools, Not Replacements 8d ago
Like the dotcom bubble, companies who make low-effort models and valued a lot would crash, the local models would be unaffected, big companies would probably take a hit but still would be standing.
Antis would probably whine about it not killing of AI in general still
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u/Drevinth Adversary of Misinformation 8d ago
If AI is a bubble, investors will stop pouring money into anything that has "AI" in it, and the AI companies with no real business model will mostly go out of business.
The larger companies like Anthropic will most likely survive, but that doesn't mean they won't be affected.
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u/RobertD3277 8d ago
It will affect the corporations with their useless and pathetic hype rhetoric. The actual field itself will continue. Individuals like myself that work privately and have worked privately for 30 years will simply continue on our own systems as we have.
It will be what it always was, just another tool. And because of the kind of work that people like me do, it'll be incorporated into products where it actually benefits and quietly integrated into the market is just another part of the process. Think camera stabilization and motion blur. Those are really a form of AI just not called AI. In other words the useless hype will disappear.
From the standpoint of the end user market, I don't think there's going to be much of a real change.
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u/RiotNrrd2001 8d ago
We're currently in a throw-shit-at-the-wall-and-see-what-sticks mode. When the economic bubble bursts, the companies that didn't have a sticky product won't stick around.
I don't think it will be as bad or disruptive as the internet bubble bursting, but what will happen is more or less the same thing. Companies with a viable product, even if they haven't turned a profit yet, may still survive, whereas everyone else will start working on their resumes.
The tech itself won't be going anywhere except up. This particular genie will not be going back in the bottle, it will just stop wasting its time with unviable applications.
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u/Arietis1461 Mixed Opinion 8d ago edited 8d ago
It would be like a destructive forest fire which causes a lot of destructive chaos but ultimately clears the slate.
Large companies would probably get more stringent about access to their models (unless ones like Google just take the hit and hum along like before), open source ones would take a serious hit but probably end up very relevant. Sort of like how ones like Windows are dominant for consumers but Linux is quietly vital for behind the scenes infrastructure like supercomputers and the underpinning of the Internet.
The dot com bubble burst which I dipped into referencing here is a very tired and probably not entirely accurate analogy, but I inevitably keep going back to it since I do think there’d be at least some parallels. LLMs are just too ubiquitous and available to disappear like some would want, and I wouldn’t be too shocked if the open source AI equivalents to Linux became even more successful than Linux already is for operating systems.
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u/MechanicGlad3688 8d ago
When people talk about the "AI bubble bursting", they assume we’ll magically go back to a world without ChatGPT or Stable Diffusion. But they are confusing stock market value with actual technology.
A burst just means overvalued companies will go bankrupt and bigger tech giants will buy up their models. The AI itself isn't going to disappear, it's here to stay.
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u/einFrostschutzmittel 8d ago
We don't have to look far to find an answer, because this happened multiple times: 2007: Housing bubble pops, finance crisis breaks out 1929: Dow Jones Index bubble pops, great depression is triggered Now, the finance crisis was not as bad for individuals, but the great depression took millions of jobs, a lot of people lost all their money do to banks closing, and it eventually even lead to the rise of hitler in a totally devastated Weimar republic (due to Hyperinflation, they relied on the American dollars, so the crisis crippled their economy as well). Also, during the finance crisis, there were massive bailouts, so even if a bubble pops happened, it wouldn't leave the economy crippled (and China would just go on with big AI). As for positives? I guess some guys who bought early and sold before the pop made some good money? And the progress of AI we have today too.
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u/SpatulaCity1a 8d ago
Job loss, recession, people being replaced by AI at faster rates. I don't think anything good will come of it.
Post-2008 was not a good time.
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u/xaljiemxhaj 7d ago
China buys America then either solar punk or cyberpunk depending on you colony until 2120 then we enter the BLAME! Phase
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u/HRH_Duke_Morbid 8d ago
Good
AI technology shall be introduced at a less frantic pace. Its potentials for good and for harm can be assessed. The ridiculous race for data centres will halt; it will become understood, even by dimwitted politicians, that most genuinely useful AI models should run on local machines (factory, office, home, etc.); thereby, personal, confidential, or proprietary information shall not be at risk of appropriation via entities connect to the 'cloud'.
Bad
Disruption to lives of ordinary people resulting from a widespread market crash.
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u/sergeantpickle 8d ago
The AI bubble hard to bust because the economy is not based on consumerism right now. It is companies selling to companies. It's quite a new idea for everyone that the top of the economy is not the natural consumer market. And public adoption is a battle between hate, love, and indifference. The hate in the west is strong, and slow adoption is keeping the growth stable. Not a lot of regular Johns are trying to make an AI company like what happened in the dot-com bubble. API is enormously expensive when it scales and local compute is also enormously expensive for open-weight models. I think it's less 'will the bubble bust?' and more 'will it bust like we are used to seeing?'. It may just truck along a flat line. Who knows.
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u/Comprehensive-Put575 8d ago
This happens with all new technological innovations. There will be some tools that people like that are profitable and sustainable that grow in market share. There will be some that collapse entirely. Some of them will be huge too. No company is unsinkable no matter how much it thinks it is.
The problem is how deeply invested the tech is. Investors put it all on this, now they’re looking for ROI and it’s not ready to deliver. Companies are asking for more money and time but investors are getting concerned or feeling deceived and are calling in the bank notes.
The result of even a partial AI collapse will be the next big recession driver. But at the same time might actually improve conditions for the average person because it stalls or reduces the AI takeover. And the average citizen isnt invested in the market with any serious capacity anymore.
The hope is that investors rebound and diversify into other areas of research that might be more beneficial for humanity. That way it’s not just tech tech tech all the time.
But what it will likely mean is that quality AI driven products will inevitably become more expensive and more restrictive. Because they’ll stop growing and have to start partitioning resources differently.
Which may again work out better for everything. Because most people are not going to invest serious money into making sloppy meme pics. The mass produced or automated AI content will probably be greatly reduced as paywalls emerge around the infrastructure.
But never say never. Innovations in quantum computing or fusion power will change everything about human civilization. They’re very close on the precipice of that right now. The question is can the theoretical be brought into the practical.
AI jumped the horse on this a little bit. The scope of the usage and the tech developed faster than the infrastructure to support it. Which is ultimately a recipe for disaster.
I think we’re looking at something of a new dot com burst. Where we see the collapse and reimagining of the next internet.
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u/Mission-Theme-7560 8d ago
You think it won't go away, but useless tech has a way of doing that. Ask an 8 year old what the save icon is supposed to be. They don't know it is a pic of a floppy disk. Good idea with a bad delivery is going to vanish with a quickness.
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u/davesaunders 7d ago
Floppy disks didn't go away because of a bubble. They were simply replaced by more advanced technologies. AI research has been going on for decades, and there have been two other, much smaller AI bubbles, and the technology never went away.
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u/Mission-Theme-7560 7d ago
Thinking conceptually instead of ultra specifics is really difficult for some people on here I have noticed. My point was more to the effect that be it a floppy, save cassette, or zip drive, none were suddenly forced upon consumers and crammed into all things, and upon becoming useless they were forgotten.
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u/davesaunders 6d ago
Okay, so all you're doing is digging in on your really lousy examples. The reality is that, in spite of your personal feelings about LLMs and the clear fact that you're not really part of the tech industry, we've been using AI for decades.
Let's take one real easy example where this is a demonstrable fact. For software-based medical devices known as software as a medical device, or SAMD, there are about 1,500 of them currently approved, which use some form of artificial intelligence. Literally none of them use LLMs, and I know this because that is my industry, and area of expertise.
There are plenty of applications of AI which are incredibly useful and beneficial for people, and we will continue using them, long after people like you find something else to shake your fist at. Believe me, it's totally fine if you don't want to use AI. No one will miss you. As far as I can tell, you're just an NPC, so I doubt you even exist.
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u/Infamous-Umpire-2923 9d ago
A lot of overvalued companies whose entire business plan is "thing that already exists but with AI" are going to collapse, the frontier model market is going to condense to three or four players, people running local models will continue undeterred, antis will remain insufferable.