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Current AI scaling laws are showing diminishing returns, forcing AI labs to change course | TechCrunch

Nov 20, 2024 - techcrunch.com
AI scaling laws, which have been used to enhance the capabilities of AI models over the past five years, are showing signs of diminishing returns, according to several AI investors, founders, and CEOs. The current methods of using more compute and more data during the pretraining phase of AI models are no longer yielding the expected results. As a result, the AI industry is shifting towards a new method known as "test-time compute," which allows AI models more time and resources to "think" before answering a question. This new approach is being hailed as the next big thing in AI scaling, with Microsoft CEO Satya Nadella and Andreessen Horowitz partner Anjney Midha among those endorsing it.

Despite the slowdown in the effectiveness of traditional AI scaling laws, there is no panic in the AI world. Many believe that there is still significant potential for improvement in the application of current AI models. For instance, advancements in user experience could enhance the performance of existing AI products. However, the shift in focus towards test-time compute could lead to a significant increase in demand for AI chips that specialize in high-speed inference, benefiting companies like Groq and Cerebras that specialize in these chips.

Key takeaways:

  • AI scaling laws, which have been used to increase the capabilities of AI models over the past five years, are showing signs of diminishing returns, leading to a potential shift in the methods used to advance AI models.
  • Test-time compute, which allows AI models more time and compute to 'think' before answering a question, is being hailed as a promising contender for the next big thing in AI scaling.
  • Despite the slowing of traditional scaling laws, there is still potential for improvement in AI models through the use of larger compute clusters and bigger datasets for pretraining.
  • Even if test-time compute does not prove to be the next wave of scaling, there is belief that there are still significant gains to be made in model performance through application-level work and user experience innovations.
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