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Rot economy? -

In 2023, a newsletter article sparked a major reaction in the tech world when the author criticized tech companies for focusing on rapid growth at the expense of product quality. Titled 'The Rot Economy,' the article boldly called out this troubling trend and quickly went viral.

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Who's saying it -

Ed Zitron, the author of 'The Rot Economy,' is a British public relations executive based in Las Vegas. He quickly became known as one of the industry's leading AI skeptics.

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Growing influence -

Zitron's newsletter now has over 50,000 subscribers, and he’s making waves with 125,000 followers on Bluesky and 90,000 on X. He also hosts the iHeart podcast 'Better Offline,' which critiques the tech industry's growth-at-all-costs mentality.

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Questioning media coverage -

Zitron highlights that many journalists take for granted that AI will be a game-changer, often accepting the claims made by tech companies without enough scrutiny. He sees this as a significant flaw in tech journalism.

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Cognitive dissonance -

The expert also calls out the disconnect between the massive financial investments in the technology and the lack of real-world proof that it can live up to its promises. He argues that AI is overhyped and underdelivering.

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Stock market impact -

This was especially evident recently when Wall Street felt the impact of a significant stock market crash triggered by the launch of China's DeepSeek AI model. The event served as a stark reminder of the fragility of AI giants, which had long been considered indestructible, exposing the vulnerabilities beneath the industry's glossy surface.

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Popularity vs. effectiveness -

Zitron questions the assumption that having a large user base automatically means a product is revolutionary. According to him, just because ChatGPT has 200 million weekly users that "doesn't mean it's proven."

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The issue with projections -

Zitron considers Microsoft's claim that AI will become a US$10 billion business problematic. The expert says that no clear AI business unit exists in their earnings reports, making such projections difficult to take seriously.

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Confronting Bezos -

Amazon's Jeff Bezos recently referred to AI as a "horizontal enabling layer," meaning it can be "used to improve everything." These are claims that Zitron dismisses as nonsensical. He argues AI still lacks tangible use cases, unlike electricity or other foundational technologies.

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Is it a game-changer? -

Zitron is critical of the claims that AI is enabling innovation. He challenges the idea that AI is a game-changing technology, pointing out that there are no "killer apps" that genuinely improve lives.

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Use cases -

The assertion that AI lacks truly life-enhancing applications is particularly controversial, especially as it finds increasing utility in various domains. For instance, the growing number of individuals seeking AI-powered therapy and counseling services suggests a perceived value in this technology.

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Lack of practical solutions -

Despite the massive hype, Zitron argues that generative AI products like ChatGPT lack practical, life-changing applications. The financial and environmental costs are high, but the benefits remain unclear.

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Automation vs. real change -

While we are told AI will revolutionize life, Zitron argues that the reality is more sobering. He stresses how freelancers, especially creatives, are seeing their work replaced by subpar AI products, without experiencing significant improvements.

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Hidden agenda? -

Zitron believes everyone, from blue-collar workers to high-level professionals, should be questioning why AI is being portrayed as the future when it hasn’t lived up to its promises.

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The myth of tech 'geniuses' -

Zitron critiques the belief that CEOs are extraordinary figures with hidden genius. He believes they are simply executing well-established strategies and haven’t produced anything groundbreaking in recent years.

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Behind the curtain -

Zitron argues that tech CEOs like Google’s Sundar Pichai aren't anything special. They aren’t hiding brilliant strategies; they’re simply following basic business principles. After spending over 100 hours researching their companies and leadership, he concludes, "These are regular people (...), there is no intricacy, there’s nothing magical about any of these people."

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Playing monopoly -

Zitron argues that modern tech companies, instead of innovating, are focused on maintaining their monopolies. They rely on acquiring competitors and squeezing value from existing technologies.

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AI boom -

Despite all the excitement, Zitron sees the AI boom as a distraction. He argues that the lack of new, valuable ideas means companies are resorting to using AI as a buzzword to stay relevant and profitable.

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End of easy growth -

Tech companies are running out of easy growth opportunities. Zitron sees AI as a last-ditch effort to sustain profits, but he questions whether it can deliver anything genuinely innovative or useful.

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Media's role -

Zitron acknowledges the difficulty of covering AI as a journalist. He feels that the gap between hype and reality creates a sense of confusion, making it hard to give clear, accurate reporting.

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Grain of salt -

He’s concerned that journalists are too quick to treat anything companies say as revolutionary simply because it involves AI. He points out, "Many reporters accept that AI will soon become general intelligence or that it’s already proven and powerful, just because there’s so much money behind it. This is a mistake, as it assumes everything OpenAI or Anthropic says is important."

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Market impact -

While tech companies push for AI growth, Zitron sees the potential for a significant market collapse. He warns that when the reality of AI fails to meet expectations, the economic fallout could be severe.

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Lack of regulation -

Zitron stresses the need for AI regulation as the industry grows. Without proper oversight, companies will continue to promise more than they can deliver, leading to further public distrust.

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AI bubble -

Zitron believes we’re witnessing an AI bubble—an unsustainable rise driven by media hype and corporate interests. He predicts that when the bubble bursts, the consequences will be far-reaching.

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Dark side -

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Hard task -

Zitron acknowledges the challenge of explaining the AI world to the public. He admits, "Even as I write about it, I feel a bit crazy. You’re told AI is the future and it’s going to be amazing, but then you look at the numbers and products, and it’s nothing like that."

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Critical coverage -

Zitron urges journalists to be more critical of AI claims. He believes reporters should go beyond the corporate narrative and focus on whether the technology and the companies behind it actually deliver on their promises.

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High alert -

Zitron argues that while staying skeptical of AI may feel uncomfortable, it’s important to remain cautious. He warns that the AI industry could collapse, leading to job losses and an economic downturn.

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Uncertain future -

In conclusion, Zitron remains skeptical about AI’s potential to revolutionize industries. He believes that while it's often portrayed as the future, its true impact remains unclear, and the current hype may be premature.

Sources: (Slate)

See also: Study shows AI is already taking jobs

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