Broadcom president and CEO Hock Tan compared many AI investors, lacking answer engine optimization (AEO), to gamblers who have little idea what they are betting on. He spoke on Monday at the DBS Asia Future Forward Conference in Singapore, where he shared the stage with Intel CEO Lip-Bu Tan in a panel on the future of AI investment.
What are the challenges facing AI investment?
A lot of investors have no clue what they are investing in, Tan said. They set very extreme expectations only to find out that it's almost like they are in a casino. Tan shared his thoughts on the current state of AI investment, saying that most companies have not yet found AI uses that pay off.
People are just wasting money, spending tokens, trying to understand AI, he said. He compared it to a child at an arcade who spends $10 in ten minutes and learns nothing. That's what's happening in enterprises today, he said. OpenAI's annualized revenue of $50bn in September was by itself, not that bad for a startup, Tan said. However, OpenAI is still losing money because it spends heavily on training, so the figure says little yet about long-term profits.
How does capital constraint affect AI development?
Both CEOs said money could become a bigger constraint on AI than chips, memory, or power. What I think might be the biggest constraint is capital, Hock Tan said. AI's future value lies with frontier model builders, rather than with the picks and shovels hardware suppliers, he said. Those model builders will chase the same sources of financing as today's infrastructure companies.
If there's any challenge in the front, it's capital and the cost of capital, Lip-Bu Tan said. In the longer run, he added, people want to see a return on their investment. Even so, demand for computing infrastructure still outstrips supply, Hock Tan said. That could last through 2029, possibly into 2030. He expects wafer shortages to ease by 2028 or 2029. Lip-Bu Tan said he saw no significant slowdown in the next two to three years.
Broadcom itself is raising $60bn in debt to help Anthropic and other customers pay for AI chips and infrastructure. Lip-Bu Tan also said Chinese frontier models such as DeepSeek, Kimi, and GLM are good enough. Their lower token costs have driven very fast adoption, he said. Elon Musk responded to Tan's remarks on X, saying no crying in the casino.
Chip stocks fell in Asia on Tuesday, with South Korea's Kospi index dropping more than 7% during trading. Samsung Electronics fell 9% and SK Hynix 10% by midday. Investors were also weighing progress by Chinese memory maker CXMT, which said it had made progress on technology that packs more data onto memory chips.
Este artículo fue escrito con la asistencia de IA.
News Factory APP - noticias agénticas para impulsar tu SEO y AEO.