{"id":80665,"date":"2025-10-15T19:37:08","date_gmt":"2025-10-15T19:37:08","guid":{"rendered":"https:\/\/www.newsbeep.com\/nz\/80665\/"},"modified":"2025-10-15T19:37:08","modified_gmt":"2025-10-15T19:37:08","slug":"the-ai-industrys-scaling-obsession-is-headed-for-a-cliff","status":"publish","type":"post","link":"https:\/\/www.newsbeep.com\/nz\/80665\/","title":{"rendered":"The AI Industry\u2019s Scaling Obsession Is Headed for a Cliff"},"content":{"rendered":"

A new study from MIT<\/a> suggests the biggest and most computationally intensive AI models may soon offer diminishing returns compared to smaller models. By mapping scaling laws against continued improvements in model efficiency, the researchers found that it could become harder to wring leaps in performance from giant models whereas efficiency gains could make models running on more modest hardware increasingly capable over the next decade.<\/p>\n

\u201cIn the next five to 10 years, things are very likely to start narrowing,\u201d says Neil Thompson, a computer scientist and professor at MIT involved in the study.<\/p>\n

Leaps in efficiency, like those seen with DeepSeek\u2019s remarkably low-cost model<\/a> in January, have already served as a reality check for the AI industry, which is accustomed to burning massive amounts of compute.<\/p>\n

As things stand, a frontier model from a company like OpenAI is currently much better than a model trained with a fraction of the compute from an academic lab. While the MIT team\u2019s prediction might not hold if, for example, new training methods like reinforcement learning produce surprising new results, they suggest that big AI firms will have less of an edge in the future.<\/p>\n

Hans Gundlach, a research scientist at MIT who led the analysis, became interested in the issue due to the unwieldy nature of running cutting edge models. Together with Thompson and Jayson Lynch, another research scientist at MIT, he mapped out the future performance of frontier models compared to those built with more modest computational means. Gundlach says the predicted trend is especially pronounced for the reasoning models that are now in vogue, which rely more on extra computation during inference.<\/p>\n

Thompson says the results show the value of honing an algorithm as well as scaling up compute. \u201cIf you are spending a lot of money training these models, then you should absolutely be spending some of it trying to develop more efficient algorithms, because that can matter hugely,\u201d he adds.<\/p>\n

The study is particularly interesting given today\u2019s AI infrastructure boom (or should we say \u201cbubble\u201d?)\u2014which shows little sign of slowing down.<\/p>\n

OpenAI and other US tech firms have signed hundred-billion-dollar deals<\/a> to build AI infrastructure in the United States. \u201cThe world needs much more compute,\u201d OpenAI\u2019s president, Greg Brockman, proclaimed this week<\/a> as he announced a partnership between OpenAI and Broadcom for custom AI chips.<\/p>\n

A growing number of experts are questioning the soundness of these deals. Roughly 60 percent<\/a> of the cost of building a data center goes toward GPUs, which tend to depreciate quickly. Partnerships between the major players also appear circular and opaque<\/a>.<\/p>\n","protected":false},"excerpt":{"rendered":"A new study from MIT suggests the biggest and most computationally intensive AI models may soon offer diminishing…\n","protected":false},"author":2,"featured_media":80666,"comment_status":"","ping_status":"","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[20],"tags":[365,62108,14628,363,364,11284,2489,111,139,69,145],"class_list":{"0":"post-80665","1":"post","2":"type-post","3":"status-publish","4":"format-standard","5":"has-post-thumbnail","7":"category-artificial-intelligence","8":"tag-ai","9":"tag-ai-lab","10":"tag-algorithms","11":"tag-artificial-intelligence","12":"tag-artificialintelligence","13":"tag-deep-learning","14":"tag-machine-learning","15":"tag-new-zealand","16":"tag-newzealand","17":"tag-nz","18":"tag-technology"},"_links":{"self":[{"href":"https:\/\/www.newsbeep.com\/nz\/wp-json\/wp\/v2\/posts\/80665","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.newsbeep.com\/nz\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.newsbeep.com\/nz\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/nz\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/nz\/wp-json\/wp\/v2\/comments?post=80665"}],"version-history":[{"count":0,"href":"https:\/\/www.newsbeep.com\/nz\/wp-json\/wp\/v2\/posts\/80665\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/nz\/wp-json\/wp\/v2\/media\/80666"}],"wp:attachment":[{"href":"https:\/\/www.newsbeep.com\/nz\/wp-json\/wp\/v2\/media?parent=80665"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.newsbeep.com\/nz\/wp-json\/wp\/v2\/categories?post=80665"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.newsbeep.com\/nz\/wp-json\/wp\/v2\/tags?post=80665"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}