alt Hacker NewsDoes anyone understand how Meta is able to spend so much money on AI with basically no AI product to speak of? Especially after sinking billions of dollars into a failed VR product? I just don't really understand why they are investing in data centers, I don't know of any actual product they offer that anyone is seriously considering using in the space.
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There are many uses for AI other than selling API/chat access. For Meta it can be for example use internally as a software tool, in the same way that they have their own datacenters instead of running on AWS. They can also use them to power recommendation algorithms to increase time on platform. Or they can use them to better target adverts and thus increase the revenue from ads. They can also use them to help people make ads on their platforms etc....
The market forgives misadventures cause Meta is still solvent and they make money YoY. Additionally, they are developing heavily in the AI space with making Llama available to the public and all the AI integrations into their products.
Because Zuckerberg is the king and has complete control, but Meta is so far behind in this so-called AI model race it will be canceled quietly. It will just be but a footnote in about 2 to 3 years.
They are using the same infinite money glitch as Google - ads revenue.
Internal use to watch everything and control everything
They will sell the capacity to others. And building data centers let's them leverage local tax advantages/incentives.
Imagine buying ad space on their platforms, but instead of writing copy and providing images, you simply give it your website.
Then they generate unique copy and images for each user (or hyper-targeted bucket of users), tailored to what would make them click. All continuously A/B tested.
They're not using their money, they're borrowing it and using Special Purpose Vehicles to book the debt so it doesn't hit their own balance sheet.