High For An AI

Elon AI towards AdonAI indeed
(Source: x.com)

There's some plenty of catching up to do on AI, despite the passage of barely a month since the last post on the subject. Beginning with SpaceX, there has been persistent doubt over the feasibility of their flagship Starmind project to run Grok (and other models) from satellites in space, with the primary technical challenge held to be cooling. In short, while space being very cold makes it seem like it would be the perfect place to plonk heat-generating graphic processing units (GPUs), the fact that it is also a vacuum means that radiation is the only way by which the heat can be dissipated. A rough estimate has a single 150kW server rack (72 GPUs) require a tennis court-sized radiator. Then, to replicate say Singapore's capacity (about 1.4 gigawatts), this would take some 10000 satellites.

Well, not a problem - Musk wants one million satellites.

This actually doesn't seem altogether fantastic - each Starship launch is planned to contain about fifty of these AI1 satellites, which gives an amortized launch cost of just one to two million bucks per satellite, perhaps less than a layman would have imagined - and also less than the projected per-satellite cost of US$5 million (US$3 million for the GPUs). SpaceX's case for economic viability then arises from their (optimistic?) projections of reduced launch costs as their Starship tech matures, starting with a price of close to US$5000 per kg of load currently without spacecraft reuse, to under US$50 per kg eventually in a decade or so.

If all this pans out, it is estimated that an AI SERVER IN SPACE would cost just a third of a terrestrial installation, which has its own hefty expenses - land acquisition, infrastructure rollouts, and buying off angry residents, to begin with. These costs are by the way coincidentally already rising, what with an AI Data Center National Day of Protest drawing large crowds on July 18, aided by valid community concerns over power and water usage, especially in more-rural areas. That said, it might be noted that space-based satellites have their own environmental issues on launch and re-entry, while dodging objections on the social costs of proliferating AI technology itself, foremost among them probably the loss in jobs. Oracle's cutting 21000 employees to facilitate AI deployment hasn't done its popularity much good, but the real shocker may be the "iron rice bowl" of GovTech retrenching too.



Team Blue-Team Red AI Divide
(Source: hai.stanford.edu)

The eventual profitability of SpaceX would however still have to rely on what they and their (Team Blue) partners can charge for the services run on their servers, and for this, a shift in focus to Team Red China is required. Countering America's now 24-entity Pax Silica as reported on last December, China has just unveiled a 29-nation Pax Sinica, more officially known as WAICO, at their just-concluded World AI Conference summit in Shanghai. While this has been described as an open challenge to America, a de-facto geopolitical reorganization and perhaps inevitably a New (AI-based) Cold War, there are conciliatory blandishments from both sides, with President Xi pushing international cooperation while not being able to resist referencing "historical injustices".

China's World AI Conference had also seen them highlight Kimi K3, a new homegrown large language model (LLM) touted as being comparable to state-of-the-art Team Blue (but mostly American) commercial offerings - particularly Anthropic's Claude Fable 5, which had been briefly restricted to U.S. nationals only in June due to its supposedly dangerous capabilities. This concern may have become moot with Kimi K3 indeed performing comparably to Fable 5 on a broad range of tasks, while being far cheaper*. That would be one thing, but the truly outrageous announcement - for Team Blue at least - is that the Kimi K3 model has been released free of charge under a modified MIT license, which to begin with is awkward for America considering their self-promotion on "openness" and "liberty"... while ringfencing their own (expensive) technology.

Possibly far more concerning than any ideological chagrin, however, is what such top-quality free LLM models imply for the valuation of American technology firms such as Anthropic, OpenAI and of course SpaceX. Kimi K3 has already wiped hundreds of billions off the likely-inflated expected valuations of the former two, and perhaps quite a bit from South Korea's KOSPI index too - though that is probably more from China's Changxin Memory Technologies announcing their own lithography breakthrough as presaged here in June, with the Dutch ASML also put on notice as to their future. Even Elon Musk has not escaped the rout, with his net worth back down to merely US$700 billion following plunges in SpaceX and Tesla share prices; for all that, he hasn't gotten anywhere near the credit due for being America's money multiplier either...



Oh no?
(Source: yahoo.com)

The narrative has thus shifted to China having erased America's supposed "six to nine month" lead in (generative) AI (that I personally had never put too much stock in, partly from how Team Blue firms don't typically benchmark** against China's open source models), and Anthropic's response has been to accuse Moonshine Moonshot AI of distilling the necessary data from their Claude model, moreover by running nearly 30 million conversations using some 25000 bot accounts. China has apparently rejected such claims as misguided, all the more as Anthropic had used millions of pirated books to develop Claude in the first place. SpaceX's Cursor is seemingly ripping off Kimi in turn with their Composer model, and the U.S. administration is expectedly looking into sanctioning the hot new Chinese tech.

Now on end-user application, while Stanford's HAI study above has America and China on opposite ends of the favourability spectrum for AI (with China a lot more positive on AI advances), it has to be said that whether people purport to like it or hate it, they are definitely using it. This is maybe nowhere as prevalent as in academia, with a history professor at an American state university discovering that 32 of his 35 students had simply copied his assignment question - hidden white text included - to an LLM, and submitted the answer (that included prompted nonsense about Madagascar) without bothering to proofread it.

This is hardly an isolated incident either, with an economics professor at Brown having a third of his class drop out after insisting on an in-person final exam following inexplicably-high scores on the take-home midterm. India has been more old-school with their exam leaks on their unfortunately-named NEET exams that has seen their Education Minister resign*** following sustained protests, and while there has been some ribbing from China about how their gaokao had been conducted smoothly, this was only after a crackdown on smart glasses, and did not cover the ample food bribes to Grand Teacher Confucius. Well, now you know why he is always smiling...


[*Returning to data centers, China's solution to the cooling problem has been to just plonk the servers underwater into the sea, while powering them using wind turbines. This has the advantage of the servers being more accessible for repairs and updates, and brings to mind the Soviet pencil anecdote.]

[**Unlike The Economist, in their analysis of LLM worldviews.]

[***It is a tough time to be a minister indeed, with our Culture Minister (Acting) getting roundly panned for joking about ministers not having time to watch movies, which was pointed out as within his job scope; he did later find time to catch one of the 100 extra screenings of Dear You. Our former Muslim Affairs minister did not fare as well, as he had to resign after diligently advancing a Muslim affair, although he did get a tribute on television out of it. One just can't win these days!]