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If the AI Roundheads go to war with tech royalty, don’t bet against them | John Naughton
Silicon Valley wants to spend a fortune on the fantasy of human-level intelligence. But there are more practical and valuable things to achieve
How else could one explain why four companies that reported combined capital expenditure of $246bn in 2024 – up from $151bn in 2023 – now propose to spend more than $320bn this year on AI, a technology for which no business model currently exists that could conceivably provide a reasonable rate of return on such an investment? And they would much prefer to cover the countryside with gigantic aluminium sheds – full of Nvidia chips running white-hot, overwhelming electricity grids, lowering water tables and draining reservoirs – than do that. The current lavish spending plans of the American giants suggest that they haven’t yet got the message Until the arrival of China’s DeepSeek-R1, the consensus in the industry could be expressed in Margaret Thatcher’s favourite acronym: “Tina” (There is no alternative).
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