FinanceThe GuardianAI slowdown calls justified but collapse of bubble may be more immediate threat
Analysts are warning the AI investment boom may be heading for a financial crash, with tech giants spending $132 billion this year on data centres while AI prices keep falling.
Scale of debt issuance being used to fund the hectic pace of the datacentre rollout by tech firms is a worry
Financial commentators are raising alarms that the AI industry's economics are unsustainable, with massive debt-funded data centre spending outpacing falling AI product prices.
Google, Amazon, Microsoft, Meta and Oracle are estimated to be spending $132 billion on data centres this year alone, funded largely by debt in a high-interest-rate environment.
As one Bloomberg report put it, the price of AI is collapsing while the cost of building it is not, raising real questions about when or whether these investments will pay off.
More from Cuppa
Satellites show Earth lost more than 12 trillion tons of ice from Greenland, Antarctica in 47 yearsSatellites show Greenland and Antarctica have lost 12.5 trillion tons of ice since 1979, raising global sea levels by about an inch and accelerating fast.
Trump claims triumphal arch will serve as a ‘top grade military complex’ to store weaponsTrump is now claiming his proposed 250-foot triumphal arch in Washington DC will double as a military complex with drone storage and rooftop sniper facilities.
Michelle Bachelet withdraws from race to become UN secretary generalFormer Chilean president Michelle Bachelet has pulled out of the race to become the next UN secretary general after losing support on the security council.
UK startup snares $20m to recreate gigs with ‘hyper-realistic’ digital avatarsA UK startup has raised $20 million to stage concerts using hyper-realistic digital avatars of both living and deceased musicians, aiming to undercut the Abba Voyage model.
Bali’s Eco-Tourism Projects Give Tourists Authentic Cultural Immersions On VacationBali's eco-tourism scene goes beyond green buzzwords, with projects rooted in the island's ancient philosophy of harmony with nature, people and the divine.
8 common food additives linked to high blood pressure and heart diseaseA large French study found eight common food preservatives are linked to meaningfully higher rates of high blood pressure and heart disease.
Scientists discover a hidden “ID card” in cat urineScientists found 13 unusual fatty acids in cat urine that act like a chemical ID card, letting cats recognise each other long-term.
US environment agency let Bayer pick regulations for destructive weedkiller, documents showInternal documents show the US EPA asked pesticide giant Bayer to choose its own regulations for the weedkiller dicamba, then put Bayer's preferences directly into a proposed federal rule.