[microtonal]

The world is not a zero-sum game, but I don't think it's likely that companies will double their advertising. So either Google, Meta, etc. will lose the AI game and most of the advertising revenue will shift to different companies or Google, Meta, etc. win and they get to keep their advertising income.

I don't see how suddenly hundreds of billions of additional ad revenue will appear.

I think some of AI companies truly wanted to make a fortune replacing all white collar workers through model exclusivity, but that open models (initially Llama and then a sequence of really good Chinese models) threw a wrench in the cogs. There is not as much you can make anymore if everyone can host their own 'workers' near cost price.

[9rx]

> So either Google, Meta, etc. will lose the AI game

They might lose entirely (search, social media, etc.) if users are more likely to direct their eyeballs to "AI" services. And that isn't an impossible scenario. What do you need traditional web search, stupid internet comments, etc. for when an LLM will generate all that and more immediately at your behest? The newspaper companies lost when other forms of media came along. "AI" could easily push things the same way.

But the businesses are still trying to prove that. It is still early days. Only time will tell if they will actually get the aforementioned user base.

[microtonal]

They might lose entirely (search, social media, etc.) if users are more likely to direct their eyeballs to "AI" services.

Sorry that I wasn't clear enough. That was what I was trying to imply - in that case the ad purchases that currently go to Google etc. will go to a new AI company. This is why both Google is investing so heavily in LLMs, they know that LLMs can kill search + website visits and thus cause them to lose their ad income.

But either way, it's questionable if it will increase all ad spending. So either AI companies collapse and a lot of VC money is burned or Google et al. collapse and a lot capital is burned (pension funds and whatnot).

[NuclearPM]

This is why Google has android and chrome, and why Facebook bought WhatsApp and Instagram. It isn’t so much about spending billions on growth, it is about hedging their bets and protecting their monopolistic cash cows.

[9rx]

Why would ad spending need to increase? Google, Meta, et al. collapsing and an "AI" business taking their place is fine. The universe doesn't care.