Deepseek Is Cheap. People Like Cheap
October 1, 2025
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This essay is the work of a dumb dinobaby. No smart software required.
I read “Deepseek Has ‘Cracked’ Cheap Long Context for LLMs With Its New Model.” (I wanted to insert “allegedly” into the headline, but I refrained. Just stick it in via your imagination.) The operative word is “cheap.” Why do companies use engineers in countries like India? The employees cost less. Cheap wins out over someone who lives in the US. The same logic applies to smart software; specifically, large language models.
Cheap wins if the product is good enough. Thanks, ChatGPT. Good enough.
According to the cited article:
The Deepseek team cracked cheap long context for LLMs: a ~3.5x cheaper prefill and ~10x cheaper decode at 128k context at inference with the same quality …. API pricing has been cut by 50%. Deepseek has reduced input costs from $0.07 to $0.028 per 1M tokens for cache hits and from $0.56 to $0.28 for cache misses, while output costs have dropped from $1.68 to $0.42.
Let’s assume that the data presented are spot on. The Deepseek approach suggests:
- Less load on backend systems
- Lower operating costs allow the outfit to cut costs to licensee or user
- A focused thrust at US-based large language model outfits.
The US AI giants focus on building and spending. Deepseek (probably influenced to some degree by guidance from Chinese government officials) is pushing the cheap angle. Cheap has worked for China’s manufacturing sector, and it may be a viable tool to use against the incredibly expensive money burning U S large language model outfits.
Can the US AI outfits emulate the Chinese cheap tactic. Sure, but the US firms have to overcome several hurdles:
- Current money burning approach to LLMs and smart software
- The apparent diminishing returns with each new “innovation”. Buying a product from within ChatGPT sounds great but is it?
- The lack of home grown AI talent exists and some visa uncertainty is a bit like a stuck emergency brake.
Net net: Cheap works. For the US to deliver cheap, the business models which involved tossing bundles of cash into the data centers’ furnaces may have to be fine tuned. The growth at all costs approach popular among some US AI outfits has to deliver revenue, not taking money from one pocket and putting it in another.
Stephen E Arnold, October 1, 2025
AI Will NOT Suck Power Like a Kiddie Toy
October 1, 2025
This essay is the work of a dumb dinobaby. No smart software required.
The AI “next big thing” has fired up utilities to think about building new plants, some of which may be nuclear. Youthful wizards are getting money to build thorium units. Researchers are dusting off plans for affordable tokamak plasma jobs. Wireless and smart meters are popping up in rural Kentucky. Just in case a big data center needs some extra juice, those wireless gizmos can manage gentle brownouts better than an old-school manual switches.
I read “AI Won’t Use As Much Electricity As We Are Told.” The blog is about utility demand forecasting. Instead of the fancy analytic models used for these forward-looking projections, the author approaches the subject in a somewhat more informal way.
The write up says:
The rise of large data centers and cloud computing produced another round of alarm. A US EPA report in 2007 predicted a doubling of demand every five years. Again, this number fed into a range of debates about renewable energy and climate change. Yet throughout this period, the actual share of electricity use accounted for by the IT sector has hovered between 1 and 2 per cent, accounting for less than 1 per cent of global greenhouse gas emissions. By contrast, the unglamorous and largely disregarded business of making cement accounts for around 7 per cent of global emissions.
Okay, some baseline data from the Environmental Protection Agency in 2007. Not bad: 18 years ago.
The write up notes:
Looking the other side of the market, OpenAI, the maker of ChatGPT, is bringing in around $3 billion a year in sales revenue, and has spent around $7 billion developing its model. Even if every penny of that was spent on electricity, the effect would be little more than a blip. Of course, AI is growing rapidly. A tenfold increase in expenditure by 2030 isn’t out of the question. But that would only double total the total use of electricity in IT. And, as in the past, this growth will be offset by continued increases in efficiency. Most of the increase could be fully offset if the world put an end to the incredible waste of electricity on cryptocurrency mining (currently 0.5 to 1 per cent of total world electricity consumption, and not normally counted in estimates of IT use).
Okay, the idea is that power generation professionals are implementing “logical” and “innovative” tweaks. These squeeze more juice from the lemon so to speak.
The write up ends with a note that power generation and investors are not into “degrowth”; that is, the idea that investments in new power generation facilities may not be as substantial as noted. The thirst for new types of power generation warrants some investment, but a Sputnik response is unwarranted.
Several observations:
- Those in the power generation game like the idea of looser regulations, more funding, and a sense of urgency. Ignoring these boosters is going to be difficult to explain to stakeholders.
- The investors pumping money into mini-reactors and more interesting methods want a payoff. The idea that no crisis looms is going to make some nervous, very nervous.
- Just don’t worry.
I would suggest, however, that the demand forecasting be carried out in a rigorous way. A big data center in some areas may cause some issues. The costs of procuring additional energy to meet the demands of some relaxed, flexible, and understanding outfits like Google-type firms may play a role in the “more power generation” push.
Stephen E Arnold, October 1, 2025
Google Is Entering Its Janus Era
September 30, 2025
This essay is the work of a dumb dinobaby. No smart software required.
The Romans found the “god” Janus a way to demarcate the old from the new. (Yep, January is a variant of this religious belief: A threshold between old and new.
Venice.ai imagines Janus as a statue.
Google is at its Janus moment. Let me explain.
The past at Google was characterized by processing a two or three word “query” and providing the user with a list of allegedly relevant links. Over time, the relevance degraded and the “pay to play” ads began to become more important. Ed Zitron identified Prabhakar Raghavan as the Google genius associated with this money-making shift. (Good work, Prabhakar! Forget those Verity days.)
The future is signaled with two parallel Google tactics. Let me share my thoughts with you.
The first push at Google is its PR / marketing effort to position itself as the Big Dog in technology. Examples range from Google’s AI grand wizard passing judgment on the inferiority of a competitor. A good example of this approach is the Futurism write up titled “CEO of DeepMind Points Out the Obvious: OpenAI Is Lying about Having PhD Level AI.” The outline of Google’s approach is to use a grand wizard in London to state the obvious to those too stupid to understand that AI marketing is snake oil, a bit of baloney, and a couple of measuring cups of jargon. Thanks for the insight, Google.
The second push is that Google is working quietly to cut what costs it can. The outfit has oodles of market cap, but the cash burn for [a] data centers, [b] hardware and infrastructure, [c] software fixes when kids are told to eat rocks and glue cheese on pizza (remember the hallucination issues?), and [d] emergency red, yellow, orange, or whatever colors suits the crisis convert directly into additional costs. (Can you hear Sundar saying, “I don’t want to hear about costs. I want Gmail back online. Why are you still in my office?)
As a result of these two tactical moves, Google’s leadership is working overtime to project the cool, calm demeanor of a McKinsey-type consultant who just learned that his largest engagement client has decided to shift to another blue-chip firm. I would consider praying to Janus if that we me in my consulting role. I would also think about getting reassigned to project involving frequent travel to Myanmar and how to explain that to my wife.
Venice.ai puts a senior manager at a big search company in front of a group of well-paid but very nervous wizards.
What’s an example of sending a cost signal to the legions of 9-9-6 Googlers? Navigate to “Google Isn’t Kidding Around about Cost Cutting, Even Slashing Its FT subscription.” [Oh, FT means the weird orange newspaper, the Financial Times.] The write up reports as actual factual that Google is dumping people by “eliminating 35 percent of managers who oversee teams of three people or fewer.” Does that make a Googler feel good about becoming a Xoogler because he or she is in the same class as a cancelled newspaper subscription. Now that’s a piercing signal about the value of a Googler after the baloney some employees chew through to get hired in the first place.
The context for these two thrusts is that the good old days are becoming a memory. Why? That’s easy to answer. Just navigate to “Report: The Impact of AI Overviews in the Cultural Sector.” Skip the soft Twinkie filling and go for the numbers. Here’s a sampling of why Google is amping up its marketing and increasing its effort to cut what costs it can. (No one at Google wants to admit that the next big thing may be nothing more than a repeat of the crash of the enterprise search sector which put one executive in jail and others finding their future elsewhere like becoming a guide or posting on LinkedIn for a “living.”)
Here are some data and I quote from “Report: The Impact…”:
- Organic traffic is down 10% in early 2025 compared to the same period in 2024. On the surface, that may not sound bad, but search traffic rose 30% in 2024. That’s a 40-point swing in the wrong direction.
- 80% of organizations have seen decreases in search traffic. Of those that have increased their traffic from Google, most have done so at a much slower rate than last year.
- Informational content has been hit hardest. Visitor information, beginner-level articles, glossaries, and even online collections are seeing fewer clicks. Transactional content has held up better, so organizations that mostly care about their event and exhibition pages might not be feeling the effect yet.
- Visibility varies. On average, organizations appear in only 6% of relevant AI Overviews. Top performers are achieving 13% and they tend to have stronger SEO foundations in place.
My view of this is typical dinobaby. You Millennials, GenX, Y, Z, and Gen AI people will have a different view. (Let many flowers bloom.):
- Google is for the first time in its colorful history faced with problems in its advertising machine. Yeah, it worked so well for so long, but obviously something is creating change at the Google
- The mindless AI hyperbole has not given way to direct criticism of a competitor who has a history of being somewhat unpredictable. Nothing rattles the cage of big time consultants more than uncertainty. OpenAI is uncertainty on steroids.
- The impact of Google’s management methods is likely to be a catalyst for some volatile compounds at the Google. Employees and possibly contractors may become less docile. Money can buy their happiness I suppose, but the one thing Google wants to hang on to at this time is money to feed the AI furnace.
Net net: Google is going to be an interesting outfit to monitor in the next six months. Will the European Union continue to send Google big bills for violating its rules? Will the US government take action against the outfit one Federal judge said was a monopoly? Will Google’s executive leadership find itself driven into a corner if revenues and growth stall and then decline? Janus, what do you think?
Stephen E Arnold, September 30, 2025
Spelling Adobe: Is It Ado-BEEN, Adob-AI, or Ado-DIE?
September 29, 2025
This essay is the work of a dumb dinobaby. No smart software required.
Yahoo finance presented an article titled “Morgan Stanley Warns AI Could Sink 42-Year-Old Software Giant.” The ultimate source may have been Morgan Stanley. An intermediate source appears to be The Street. What this means is that the information may or may not be spot on. Nevertheless, let’s see what Yahoo offers as financial “news.”
The write up points out that generative AI forced Adobe to get with the smart software program. The consequence of Adobe’s forced march was that:
The adoption headlines looked impressive, with 99% of the Fortune 100 using AI in an Adobe app, and roughly 90% of the top 50 accounts with an AI-first product.
Win, right? Nope. The article reports:
Adobe shares have tanked 20.6% YTD and more than 11% over six months, reflecting skepticism that AI features alone can push its growth engine to the next level.
Loss, right? Maybe. The article asserts:
Although Adobe’s AI adoption is real, the monetization cadence is lagging the marketing sizzle. Also, Upsell ARPU and seat expansion are happening. Yet ARR growth hasn’t re-accelerated, which raises some uncomfortable questions for the Adobe bulls.
Is the Adobe engine of growth and profit emitting wheezes and knocks? The write up certainly suggests that the go-to tool for those who want to do brochures, logos, and videos warrants a closer look. For example:
- Essentially free video creation tools with smart software included are available from Blackmagic, the creators of actual hardware and the DaVinci video software. For those into surveillance, there is the “free” CapCut
- The competition is increasing. As the number of big AI players remains stable, the outfits building upon these tools seems to be increasing. Just the other day I learned about Seedream. (Who knew?)
- Adobe’s shift to a subscription model makes sense to the bean counters but to some users, Adobe is not making friends. The billing and cooing some expected from Adobe is just billing.
- The product proliferation with AI and without AI is crazier than Google’s crypto plays. (Who knew?)
- Established products have been kicked to the curb, leaving some users wondering when FrameMaker will allow a user to specify specific heights for footnotes. And interfaces? Definitely 1990s.
From my point of view, the flurry of numbers in the Yahoo article skip over some signals that the beloved golden retriever of arts and crafts is headed toward the big dog house in the CMYK sky.
Stephen E Arnold, September 29, 2025
Being Good: Irrelevant at This Time
September 29, 2025
Sadly I am a dinobaby and too old and stupid to use smart software to create really wonderful short blog posts.
I read an essay titled “Being Good Isn’t Enough.” The author seems sincere. He provides insight about how to combine knowledge to create greater knowledge value. These are not my terms. The jargon appears in “The Knowledge Value Revolution or a History of the Future by Taichi Sakaiya. The book was published in Japan in 1985. I gave some talks shortly after the book was available. One of the individuals whom I met after one of my lectures at the Osaka Institute of Technology. I recommend the book because it expands on the concepts touched upon in the cited essay.
“Being Good Isn’t Enough” states:
The biggest gains come from combining disciplines. There are four that show up everywhere: technical skill, product thinking, project execution, and people skills. And the more senior you get, the more you’re expected to contribute to each.
Sakaiya includes this Japanese proverb:
As an infant, he was a prodigy. As a student, he was brilliant. But after 20 years, he was just another young man.
“Being Good Isn’t Enough” walks through the idea of identifying “your weakest discipline” and then adds:
work on that.
Sound advice. However, in today’s business environment in the US, I do not think this suggestion is particularly helpful; to wit:
Find a mentor, be a mentor. Lead a project, propose one. Do the work, present it. Create spaces for others to do the same. Do whatever it takes to get better…. But all of this requires maybe the most important thing of all: agency. It’s more powerful than smarts or credentials or luck. And the best part is you can literally just choose to be high-agency. High-agency people make things happen. Low-agency people wait. And if you want to progress, you can’t wait.
I think the advice is unlikely to “work” in the present world of work is calibrating as if it were 1970. Today the path forward depends on:
- Political connections
- Friends who can make introductions
- Former colleagues who can provide a soft recommendation in order to avoid HR issues
- Influence either inherited from a parent or other family member or fame
- Credentials in the form of a degree or a letter of acceptance from an institution perceived by the lender or possible employer as credible.
A skill or blended skills are less relevant at this time.
The obvious problem is that a person looking for a job has to be more than a bundle of knowledge value. For most people, Sakaiya’s and “Being Good’s” assertions are unlikely to lead to what most people want from work: Fulfillment, reward, and stability.
Stephen E Arnold, September 29, 2025
Is Google Kicking the Tires of Telegram-Type Crypto Methods?
September 29, 2025
This essay is the work of a dumb dinobaby. No smart software required.
There’s been quite a bit of talk about US and China. There is the tariff hassle; there is the AI chip dust up; and there is the on-going grousing about Taiwan. Some companies are shifting manufacturing from China to other countries. (Apple, how is that going for you?)
Art produced by Venice.ai.
I noted a small item which suggests that Google is getting more comfortable with Chinese outfits that are on paper slightly less wired into the Middle Kingdom. “Ant International Among Over 60 Firms Backing Google’s Push for AI Agent Payments” reports as actual factual:
The fintech giant will use its expertise in alternative payments and AI to help shape Google’s open protocol for agent-led transactions.
The news item adds:
Ant International has teamed up with Google to help shape a new way for AI agents to make payments safely, a step that could speed up the growth of autonomous commerce. The Agent Payments Protocol (AP2) is an open system that sets out how AI agents can carry out transactions with a user’s approval. It is designed to check user intent, make transactions easier to track, improve privacy and make it clear who is responsible for each step. The protocol works with different payment types including cards, real-time bank transfers and stablecoins. It also connects with Google’s Agent2Agent and Model Context systems. In addition, Google has launched the A2A x402 extension to support crypto payments between AI agents. Ant International said it will use its experience with alternative payment methods and its links to 36 digital wallets to help build AP2.
This passage adds a bit of allegedly accurate information new to me; specifically, the inclusion of stablecoin support. Yep, crypto and “crypto payments between AI agents.” Telegram’s platform has functions that allow these types of transactions. What’s interesting is that crypto transactions have been used by Kucoin for illegal purposes. The US Securities & Exchange Commission caused a leadership change at Ku Group (the developer of Kucoin) earlier in 2025.
The article quotes a Googler named Mark Micallef as saying:
“AP2 establishes the core building blocks for secure transactions that will drive further growth, creating clear opportunities for the industry—including networks, issuers, merchants, and end users—to innovate on adjacent areas like seamless agent authorization. We’re committed to evolving this protocol in an open, collaborative process and invite the entire payments and technology community to build this future with us.”
Google explains what it is doing in a very cheery and upbeat video at this link.
Has Google decided that Ant International is not too close to the Chinese government? Has Google, like Apple, found a way to conduct business despite the US government’s efforts to limit certain interactions with China and Chinese firms? How likely will these crypto payments be probed by bad actors to determine if money laundering, for instance, can be automated on this international but Googley platform?
As a dinobaby, I find the Telegram-ization of Google’s payment system most interesting.
Stephen E Arnold, September 29, 2025
Modern Management Method and Modern Pricing Plan
September 25, 2025
Sadly I am a dinobaby and too old and stupid to use smart software to create really wonderful short blog posts.
Despite the sudden drop in quantity and quality in my newsfeed outputs, one of my team spotted a blog post titled “Slack Is Extorting Us with a $195K/Year Bill Increase.” Slack is, I believe, a unit of Salesforce. That firm is in the digital Rolodex business. Over the years, Salesforce has dabbled with software to help sales professionals focus. The effort was part of Salesforce’s attention retention push. Now Salesforce is into collaborative tools for professionals engaged in other organizational functions. The pointy end of the “force” is smart software. The leadership of Salesforce has spoken about the importance of AI and suggested that other firms’ collaboration software is not keeping up with Slack.
A forward-leaning team of deciders reaches agreement about pricing. The alpha dog is thrilled with the idea of a price hike. The beta buddies are less enthusiastic. But it is accounting job to collect on booked but unpaid revenue. The AI system called Venice produced this illustration.
The write up says:
For nearly 11 years, Hack Club – a nonprofit that provides coding education and community to teenagers worldwide – has used Slack as the tool for communication. We weren’t freeloaders. A few years ago, when Slack transitioned us from their free nonprofit plan to a $5,000/year arrangement, we happily paid. It was reasonable, and we valued the service they provided to our community.
The “attention” grabber in this blog post is this paragraph:
However, two days ago, Slack reached out to us and said that if we don’t agree to pay an extra $50k this week and $200k a year, they’ll deactivate our Slack workspace and delete all of our message history.
I think there is a hint of a threat to the Salesforce customer. I am probably incorrect. Salesforce is popular, and it is owned by a high profile outfit embracing attention and AI. Assume that the cited passage reflects how the customer understood the invoice and its 3,000 percent plus increase and the possible threat. My question is, “What type of management process is at work at Salesforce / Slack?”
Here are my thoughts. Please, remember that I am a dinobaby and generally clueless about modern management methods used to establish pricing.
- Salesforce has put pressure on Slack to improve its revenue quickly. The Slack professionals knee jerked and boosted bills to outfits likely to pay up and keep quiet. Thus, the Hack Club received a big bill. Do this enough times and you can demonstrate more revenue, even though it may be unpaid. Let the bean counters work to get the money. I wonder if this is passive resistance from Slack toward Salesforce’s leadership? Oh, of course not.
- Salesforce’s pushes for attention and AI are not pumping the big bucks Salesforce needs to avoid the negative consequences of missing financial projections. Bad things happen when this occurs.
- Salesforce / Slack are operating in a fog of unknowing. The hope for big payoffs from attention and AI are slow to materialize. The spreadsheet fever that justifies massive investments in AI is yielding to some basic financial realities: Customers are buying. Sticking AI into communications is not a home run for Slack users, and it may not be for the lucky bean counters who have to collect on the invoices for booked but unpaid revenue.
The write up states:
Anyway, we’re moving to Mattermost. This experience has taught us that owning your data is incredibly important, and if you’re a small business especially, then I’d advise you move away too.
Salesforce / Slack loses a customer and the costs associated with handling data for what appears to be a lower priority and lower value customer.
Modern management methods are logical and effective. Never has a dinobaby learned so much about today’s corporate tactics than I have from my reading about outfits like Salesforce / and Slack.
Stephen E Arnold, September 25, 2025
Want to Catch the Attention of Bad Actors? Say, Easier Cross Chain Transactions
September 24, 2025
This essay is the work of a dumb dinobaby. No smart software required.
I know from experience that most people don’t know about moving crypto in a way that makes deanonymization difficult. Commercial firms offer deanonymization services. Most of the well-known outfits’ technology delivers. Even some home-grown approaches are useful.
For a number of years, Telegram has been the go-to service for some Fancy Dancing related to obfuscating crypto transactions. However, Telegram has been slow on the trigger when it comes to smart software and to some of the new ideas percolating in the bubbling world of digital currency.
A good example of what’s ahead for traders, investors, and bad actors is described in “Simplifying Cross-Chain Transactions Using Intents.” Like most crypto thought, confusing lingo is a requirement. In this article, the word “intent” refers to having crypto currency in one form like USDC and getting 100 SOL or some other crypto. The idea is that one can have fiat currency in British pounds, walk up to a money exchange in Berlin, and convert the pounds to euros. One pays a service charge. Now in crypto land, the crypto has to move across a blockchain. Then to get the digital exchange to do the conversion, one pays a gas fee; that is, a transaction charge. Moving USDC across multiple chains is a hassle and the fees pile up.
The article “Simplifying Cross Chain Transaction Using Intents” explains a brave new world. No more clunky Telegram smart contracts and bots. Now the transaction just happens. How difficult will the deanonymization process become? Speed makes life difficult. Moving across chains makes life difficult. It appears that “intents” will be a capability of considerable interest to entities interested in making crypto transactions difficult to deanonymize.
The write up says:
In technical terms,
intentsare signed messages that express a user’s desired outcome without specifying execution details. Instead of crafting complex transaction sequences yourself, you broadcast your intent to a network ofsolvers(sophisticated actors) who then compete to fulfill your request.
The write up explains the benefit for the average crypto trader:
when you broadcast an intent, multiple solvers analyze it and submit competing quotes. They might route through different DEXs, use off-chain liquidity, or even batch your intent with others for better pricing. The best solution wins.
Now, think of solvers as your personal trading assistants who understand every connected protocol, every liquidity source, and every optimization trick in DeFi. They make money by providing better execution than you could achieve yourself and saves you a a lot of time.
Does this sound like a use case for smart software? It is, but the approach is less complicated than what one must implement using other approaches. Here’s a schematic of what happens in the intent pipeline:
The secret sauce for the approach is what is called a “1Click API.” The API handles the plumbing for the crypto bridging or crypto conversion from currency A to currency B.
If you are interested in how this system works, the cited article provides a list of nine links. Each provides additional detail. To be up front, some of the write ups are more useful than others. But three things are clear:
- Deobfuscation is likely to become more time consuming and costly
- The system described could be implemented within the Telegram blockchain system as well as other crypto conversion operations.
- The described approach can be further abstracted into an app with more overt smart software enablements.
My thought is that money launderers are likely to be among the first to explore this approach.
Stephen E Arnold, September 24, 2025
A Googler Explains How AI Helps Creators and Advertisers in the Googley Maze
September 24, 2025
Sadly I am a dinobaby and too old and stupid to use smart software to create really wonderful short blog posts.
Most of Techmeme’s stories are paywalled. But one slipped through. (I wonder why?) Anyhow, the article in question is “An Interview with YouTube Neal Mohan about Building a Stage for Creators.” The interview is a long one. I want to focus on a couple of statements and offer a handful of observations.
The first comment by the Googler Mohan is this one:
Moving away from the old model of the cliché Madison Avenue type model of, “You go out to lunch and you negotiate a deal and it’s bespoke in this particular fashion because you were friends with the head of ad sales at that particular publisher”. So doing away with that model, and really frankly, democratizing the way advertising worked, which in our thesis, back to this kind of strategy book, would result in higher ROI for publishers, but also better ROI for advertisers.
The statement makes clear that disrupting advertising was the key to what is now the Google Double Click model. Instead of Madison Avenue, today there is the Google model. I think of it as a maze. Once one “gets into” the Google Double Click model, there is no obvious exit.
The art was generated by Venice.ai. No human needed. Sorry freelance artists on Fiverr.com. This is the future. It will come to YouTube as well.
Here’s the second I noted:
everything that we build is in service of people that are creative people, and I use the term “creator” writ large. YouTubers, artists, musicians, sports leagues, media, Hollywood, etc., and from that vantage point, it is really exceedingly clear that these AI capabilities are just that, they’re capabilities, they’re tools. But the thing that actually draws us to YouTube, what we want to watch are the original storytellers, the creators themselves.
The idea, in my interpretation, is that Google’s smart software is there to enable humans to be creative. AI is just a tool like an ice pick. Sure, the ice pick can be driven into someone’s heart, but that’s an extreme example of misuse of a simple tool. Our approach is to keep that ice pick for the artist who is going to create an ice sculpture.
Please, read the rest of this Googley interview to get a sense of the other concepts Google’s ad system and its AI are delivering to advertisers and “creators.”
Here’s my view:
- Google wants to get creators into the YouTube maze. Google wants advertisers to use the now 30 year old Google Double Click ad system. Everyone just enter the labyrinth.
- The rats will learn that the maze is the equivalent of a fish in an aquarium. What else will the fish know? Not too much. The aquarium is life. It is reality.
- Google has a captive, self-sustaining ecosystem. Creators create; advertisers advertise because people or systems want the content.
Now let me ask a question, “How does this closed ecosystem make more money?” The answer, according to Googler Mohan, a former consultant like others in Google leadership, is to become more efficient. How does one become more efficient? The answer is to replace expensive, popular creators with cheaper AI driven content produced by Google’s AI system.
Therefore, the words say one thin: Creator humans are essential. However, the trajectory of Google’s behavior is that Google wants to maximize its revenues. Just the threat or fear of using AI to knock off a hot new human engineered “content object” will allow the Google to reduce what it pays to a human until Google’s AI can eliminate those pesky, protesting, complaining humans. The advertisers want eyeballs. That’s what Google will deliver. Where will the advertisers go? Craigslist, Nextdoor, X.com?
Net net: Money is more important to Google than human creators. I know I am a dinobaby and probably incorrect. That’s how I see the Google.
Stephen E Arnold, September 24, 2025
Titanic AI Goes Round and Round: Are You Dizzy Yet?
September 23, 2025
This essay is the work of a dumb dinobaby. No smart software required.
I read “Nvidia to Invest Up to $100 Billion in OpenAI, Linking Two Artificial Intelligence Titans.” The headline makes an important point. The words “big” and “huge” are not sufficiently monumental. Now we have “titans." As you may know, a “titan” is a person of great power. I will leave out the Greek mythology. I do want to point out that “titans” were the kiddies produced by Uranus and Gaea. Titans were big dogs until Zeus and a few other Olympian gods forced them to live in what is now Newark, New Jersey.
An AI-generated diagram of a simple circular deal. Regulators and and IRS professionals enjoy challenges. What are those people doing to make the process work? Thanks, MidJourney.com. Good enough.
The write up from the outfit that it is into trust explains how two “titans” are now intertwined. No, I won’t bring up the issue of incestuous behavior. Let’s stick to the “real” news story:
Nvidia will invest up to $100 billion in OpenAI and supply it with data center chips… Nvidia will start investing in OpenAI for non-voting shares once the deal is finalized, then OpenAI can use the cash to buy Nvidia’s chips.
I am not a finance, tax, or money wizard. On the surface, it seems to me that I loan a person some money and then that person gives me the money back in exchange for products and services. I may have this wrong, but I thought a similar arrangement landed one of the once-famous enterprise search companies in a world of hurt and a member of the firm’s leadership in prison.
Reuters includes this statement:
Analysts said the deal was positive for Nvidia but also voiced concerns about whether some of Nvidia’s investment dollars might be coming back to it in the form of chip purchases. "On the one hand this helps OpenAI deliver on what are some very aspirational goals for compute infrastructure, and helps Nvidia ensure that that stuff gets built. On the other hand the ‘circular’ concerns have been raised in the past, and this will fuel them further," said Bernstein analyst Stacy Rasgon.
“Circular” — That’s an interesting word. Some of the financial transaction my team and I examined during our Telegram (the messaging outfit) research used similar methods. One of the organizations apparently aware of “circular” transactions was Huione Guarantee. No big deal, but the company has been in legal hot water for some of its circular functions. Will OpenAI and Nvidia experience similar problems? I don’t know, but the circular thing means that money goes round and round. In circular transactions, at each touch point magical number things can occur. Money deals are rarely hallucinatory like AI outputs and semiconductor marketing.
What’s this mean to companies eager to compete in smart software and Fancy Dan chips? In my opinion, I hear my inner voice saying, “You may be behind a great big circular curve. Better luck next time.”
Stephen E Arnold, September 23, 2025
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