Tag: AI shovels
You may have to pay 4x more for slop.
In a case of making the cost of making the AI shovel more expensive because companies know how much they are burning in compute for slop Google is making the Pro tier off-limits to Plus members.
Google is reportedly informing Gemini AI Plus subscribers about a change that could make accessing its more advanced AI models much more expensive than it is right now. From November 13, 2026, you will no longer be able to manually select Pro models in the Gemini app and AI Mode in Google Search. If you want to continue using these models, you may have to upgrade to a more expensive subscription.
While this may decrease the slopocalypse it will not decrease the burning hole in profits that AI is currently causing.
The change does not mean Google is increasing the price of the existing AI Plus plan. Instead, it is restricting access to Pro models, making a higher-tier subscription necessary for users who want to keep selecting them. Read on to know what’s happening.
Ask too many questions get fewer answers, Google is basically making it harder to access higher tier functions of the AI, if anything this is making me wonder if google is either burning too much cash on AI or are they trying to slow down AI brainrot. Because AI is currently consuming itself with model degradation due to eating its own output. I find it funny that google is trying to do this now when they are in the middle of screaming from the rooftops that AI will steal your underwear and take over your TV.
For AI Plus subscribers, the decision will depend on how they use Gemini. Those who mainly need quick responses and everyday assistance can continue using the available Flash and Flash Lite models. However, users who prefer Pro models for tasks that require more advanced reasoning or detailed responses may need to consider upgrading.
Another place where the AI shovel fails here is there is no amount they give you to what the limitations are. Basically they say, If you use the better AI models you can use them but we are not going to tell you when the tool breaks which is pretty crazy. So what now… if you want to figure out a mathematical model you get shutdown halfway through but if you generate slop you create some John Kimball Matrix mashup that is fine? There needs to be established amounts here, you cant just put your hand out and say here you can use our tool and then pull it away at a random time. I know my kids gas tank is 16.9 gallons . I know that tank can go roughly 360 to 390 miles. we do not even get that with AI.
Attributions from:
Gizbot – You May Have to Pay 4x More for Gemini AI Plus, Says Google
The AI goldmine fails to produce in the AI goldrush
Here we go again.
Google admits AI search makes less money, but it’s fixing that with more ads Google’s negative cash flow balloons to -$9.06 billion, and stock price tumbles following Q3 earnings.
This is the consensus in the entire market right now.. Everyone is rushing for the precious AI and no one is checking the balance books. But google thinks they have an idea. Throw ads at it.
The company took in almost $128 billion in Q3 2026, earning more than $26 billion in net income. These may sound like good numbers, but financial markets are not impressed. While revenue is up 25 percent versus last year, net income is almost $9 billion lower. As of this story’s publication, the stock price is down almost 12 percent, and it was down about 13 percent earlier in the day.
The funny thing is google lost their way a long time ago.. about the time they dropped the “do no evil” part and they are paying for it each day. If google stuck by the “do no evil” they would of released an AI and not tried to make it a slopathon. The problem I am seeing here is every LLM is doing the same thing. Sam Altman and the rest of the CEOs are all turning into Smeagle on his way to turning into gollum.
Google is not slowing down—it’s only going to accelerate the shift toward more AI. Like last quarter, Google reported negative cash flow in Q3. The loss actually increased from -$5.8 billion to -$9.06 billion, a situation that is directly attributable to Google’s runaway AI spending. Google had capital expenditures of $51.4 billion in Q3 and says it still expects total 2026 spending to be between $195 billion and $205 billion. In 2027, Google is targeting more than $300 billion of AI investment.
The thing is with all conditions in the market, Google is taking a huge gamble with the market. Because of the market right now while the Dow is ok the market as a whole is starting to look like a wasteland. Banks are pulling back, Real estate is getting very stale in the residential sectors.
The company’s AI compute infrastructure doesn’t just power Gemini. Countless AI startups pay to run models on Google’s infrastructure. But even the larger AI firms are using venture cash to do it, and if that funding were to dry up, Google’s cloud revenues could go with it.
Where google is making some money is they are injecting there search into everything, it is to the point that you can not take a shit without AI being part of the deal. I’ve brought up the AI goldrush a lot on my site, the only reason google is not drowning is they are strip mining versus using a shovel and not only that they own the mine and the shovels being sold.
While Google’s investments ensure it still turns a profit, the trend of spending more than it earns on products and services (that negative cash flow) could come back to bite it. Search growth is declining, and Google is placing all its eggs in the AI basket.
Google though as much as it owns it is making the same mistakes as other llms and they bought the mine and the farm and never checked the soil so to speak so when it comes to AI it will hurt in the end when the bills come in.
Attributions from:
https://arstechnica.com/gadgets/2026/10/google-admits-ai-search-makes-less-money-but-its-fixing-that-with-more-ads/
META’s race to the bottom continues with overspending.
Meta said Monday it is planning to raise a total of $95 billion to support its investments in artificial intelligence infrastructure and superintelligence. The stock was down 1.6% in morning trading after the announcement. Nvidia, Advanced Micro Devices and Broadcom were interested in purchasing up to $5 billion in shares, Meta said in a statement. The tech giant will initially raise $35 billion in underwritten public equity offerings, before raising an additional $60 billion with an at-the-market program.
In the race to the bottom for nothing Meta is having a hold my beer moment and trying to sell its shirt for more precious AI.
The news comes as hyperscalers pour record sums into the AI infrastructure build-out. Goldman Sachs estimates that AI-related capital spending could total about $7.6 trillion from 2026 through 2031, across compute, data centers and power. Meta’s planned investments will support “emerging AI opportunities” including its family of apps, its AI agent Muse and its data center business, the company said Monday.
The spending for AI is getting so far over the top that when this crashes it will not be pretty. Because at this point everyone is trying to outbuild each other. Even though that AI makers are saying slow down its a game of poker where every LLM is trying to outbluff everyone else and no one really has the upper hand but Nvidia and Micron.
Meta is among the major hyperscalers that are increasingly tapping debt to fund the expensive infrastructure required for the AI boom. Last week, Meta posted third-quarter results showing revenue jumped 26% year on year: $64.60 billion versus the $63.37 billion analysts expected. However, investors focused more on the tech company’s negative free cash flow and its higher full-year capital expenditure forecast.
The thing is here more companies are carrying two ledgers and are moving debts to the hidden books. Companies are leveraging anything that is not locked down and they think that the AI gold rush is coming and selling a better shovel will access the AI gold faster.
In my belief I think there is a collapse coming, Whether it be like the 2008 Mortgage crisis or worse. Given that spending is massively out of control and the markets while they are going up it’s only a increase of what you see. There are massive failures building up in the shadows and many of the corporations while showing profits they are showing profits by shifting prices and cooking the books. While mortgage companies and banks are regulated the corporations are much less regulated and are right now doing everything they can to show a “profit”.
It now expects its full-year capex to range from $135 billion to $145 billion, raising the bottom of the range from $130 billion. That sent Meta’s shares lower on Thursday.
Given that they posted a 64.60 Billion profit and spending 135 billion is a MASSIVE mismatch in direction. Facebook has been dropping user engagement and Meta with Quest has been losing engagement as well has put their whole hog into the generative AI thinking it will create magic profits. Eventually this spending is going to catch up with meta and when the check is due who is going to pay for this. Especially with every company outspending any profit being made they can not expect the US to bail them out.
Alphabet, Google’s parent company, said it would look to raise $85 billion in June. SpaceX has closed a $40 billion debt financing to purchase graphics processing units. Anthropic is preparing for an initial public offering. TikTok U.S. is looking to secure multiple gigawatts of computing capacity over the coming years, CNBC reported Friday.
As more people are jumping into the AI gold rush there is a finite capacity and when this all ends there will be one AI mine and millions of shovels looking for profits.
From
CNBC – Meta announces $95 billion stock offering to fund AI expansion
Nokia Fallen from grace, Esteemed phone maker to Shovel seller.
Ed note: Gemini almost did it here .. but it is funny what it did with the phones. and two closed signs.
Nokia the maker of legendary phones such as the Nokia N900 and the Nokia 3310 is now peddling shovels for the AI Goldrush and trying to use some legendary logic. AI data centers would be built two times faster if there were not supply chain issues
The tech industry would build data centers twice as fast without the supply constraints they face, the CEO of Nokia told CNBC, underscoring continued demand for AI even as top executives debate slowing down the pace of development.
No shit Sherlock, you can build faster when you have the parts. I feel like this is something else though, I think Nokia realized they were late for the AI party and wishes they could sell some data centers.
“I don’t think you can say in any manner we’re overbuilding today because reality is that if we could build 2x faster, our customers could build 2x faster, they probably would,” Justin Hotard told CNBC’s “The Tech Download” podcast.
The thing is right now with the amount of CAPEX being built out we have no idea of the true capacity that has been built out. You have every company on earth who knows how to turn on a computer building out with data centers and the thing about AI is NO ONE truly knows how much capacity is needed. Because if ChatGPT or Gemini break through with efficiency that saves half of the speed needed these companies are not going to burn through millions of dollars of computing when they can save half.
“So that gives me confidence that we’re still in the early days” of the AI buildout, Hotard added. Shortages of key memory chips and energy are among the supply constraints facing the sector. Nokia, one of the world’s biggest telecommunications equipment makers, has pivoted to become a key player within the AI infrastructure space. It sells the technology required to connect racks of chips within data centers as well as technology that interconnects data centers across different locations.
Hey Hotard go read about 1849 and you will understand that the amount of shovels had no connection to the amount of gold that was dug from the ground. This is just posturing to make it sound like the AI gold rush is still going on. But Mr Hotard should make another n900 for this generation that has AI on board rather than blow more money on AI that we do not know where it will be in a year.
Nokia’s growing role as a “picks and shovels” player in the AI boom appears to have won over investors, with the stock up around 130% over the past year .But there’s been continued debate over whether the industry is building data centers too fast and whether demand will be there to sustain it. Investments in the AI buildout from data centers to chips and related infrastructure will total $10.3 trillion from 2025 to 2032 — an average of 3.63% of U.S. gross domestic product per year, according to research presented at the Brookings Papers on Economic Activity.
The funny thing right now how many companies are overspent on CAPEX build out (all of them) is going to have some horrifying detrimental actions when the bill comes due. Right now are are all focused on Magic Farts and Butterflies of AI on the market and people are buying into it like it is the best thing since the Knife that sliced bread. But sooner or later the bill is going to come due and it will make the school loan debt crisis look like someone was missing school lunch money.
Hotard said that demand for AI is not just predicated on frontier labs like Anthropic and OpenAI releasing new models. “I think the reality is that we’re even where we are today is so early in the deployment, and the power of these models is so massive that there’s a lot of there’s a lot of demand to run in just deploying,” Hotard said. “Even if we didn’t have another frontier model released in the next three years, we could probably make tremendous progress just deploying the technology that’s there today.”
Hotard translation here: “please keep buying out AI shovels and don’t worry we will make sure to bill you triple.
Attributions from:
CNBC – Nokia CEO says data centers would be built ‘2x faster’ without supply constraints
Are the Tailings Ponds About to Burst in the AI Goldrush?
In a sign of the times Anthropic has listed a net loss of 80 BILLION with a b…
Anthropic’s net loss widened sharply to $80.7 billion in the first half of this year, in large part due to a rise in the fair value of bonds convertible into shares of the AI startup, according to a draft prospectus for a planned initial public offering that was reviewed by Reuters.
I have been steadfast in saying AI is a seriously overpriced commodity that has been nothing more than a goldrush. AI is just google search in a trench coat. And that the markets rush to stake a claim in the Gold rush era is much like the 1849 gold rush.
FINANCING COSTS
At an investor meeting on October 14, Anthropic told prospective IPO investors that its third-quarter revenue jumped 45% to $16.8 billion from the previous quarter, Reuters reported, citing people familiar with the matter.
While the figures eased some concerns about the enormous costs of developing AI systems, some investors were disappointed by the slowing sequential growth rate. Revenue had more than doubled from the first quarter to $11.6 billion in the second quarter.
The thing is here is this is only half the numbers, most LLMs have been pushing all CapEx expenditures to a second set of books and it makes these companies look better than they really are. When all of the loans come to be due it is going to be a financial bloodbath because what we are seeing is AI is not ready for the mainstream for constant use. The factor that AI has been a consistent loss leader and companies have no clue how to monetize it in a way that is not going to drive users off they are stuck with negative gains.
A cooler reception for Anthropic’s IPO could weigh on the wider AI market, whose near-term prospects investors see as hinging largely on the share sale’s success, ahead of rival OpenAI’s potential listing next year.
Reuters reported in September that Anthropic posted a net loss of $42 billion in 2025, with most of that stemming from a similar accounting charge. As Anthropic’s valuation climbed, the estimated fair value of those notes tripled year over year.
The thing is, investors they thought they had a slop generating gold shovel paradise and the new car smell of AI is wearing off. While LLMs are trying to say that AI will destroy the world and eat your firstborn and knock up your daughter … The fix still is a power switch in the end.
Attributions from:
reuters – Anthropic logged net loss of over $80 billion in first half of 2026
CoffeeCommander.net – Anthropic says they are profitable as long as you don’t check the inbox for bills.
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