Better Offline The Case Against Generative AI (Part 4)
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Oct 3, 2025 In this discussion, Ed Zitron unpacks the unsustainable financial projections of generative AI, highlighting a potential capital shortfall of $1 trillion in four years. He critiques OpenAI's lofty revenue claims, comparing them to established giants and calling for skepticism around AI investments. Zitron also explores the unlikely involvement of government bailouts and the media's complicity in perpetuating inflated narratives, all while questioning the actual demand for generative AI technology.
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GPUs Are Not General Infrastructure
- AI data centers are not like past infrastructure booms because GPUs have limited alternate uses.
- That makes the current GPU-driven buildout a uniquely risky and narrow bubble.
Funding Claims Don't Add Up
- OpenAI's reported funding tranches and projections don't match the scale of the data-center costs they claim.
- That discrepancy implies their publicized deals and valuations may be misleading or incomplete.
Revenue Projections Versus Cash Burn
- OpenAI projects massive revenue growth while also projecting huge negative free cash flows for years.
- Those simultaneous projections are implausible and suggest the financial model is unrealistic.