this post was submitted on 01 Oct 2026
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Yeah. Not a surprise.
everyone has bet on AI getting good enough to fully replace humans fast. CEOs mandated use of AI. The results weren't as great as expected. CEOs started limiting AI use to counter the token cost explosion after employees found out how to waste tokens fast.
At the same time, China's AI development is driven by the party instead of companies. They aren't so much interested in money as they are in the strategic solution to the demographic problem caused by the one-child policy (which worked a bit too well too fast). The companies there plan on making money by providing the compute (they literally have the power and a two digit number of nucular GW under construction right now).
So their models are almost as good as US ones and freely downloadable to run on whatever hardware you want. That naturally limits the longterm-achievable AI token prices to little more than the cost of just providing the raw compute.
US AI companies are also in a cut-throat competition for customers right from the start. That obviously doesn't help to keep prices high. Currently, they all burn money so fast that it's hard for a human mind to comprehend.
None of the US AI companies will survive the next decade if they don't actually are the only one making AI actually able to fully replace human workers. They will all go bankrupt and might take the whole US economy with them.
Nvidia will probably be the real winner if they don't fuck this up somehow (not sure if that is even possible) because they are the ones selling the shovels in this gold rush.
In two decades, it will be normal to have the capabilities of current frontier models running locally on your Chinese phone.
The only thing I would add to this is that (in my understanding) Nvidia is largely selling future GPU manufacturing capacity to the large AI providers. So, if the providers end up going belly up, thrn Nvidia might take heftly losses from that as well.