Premium: AI’s Circular Psychosis

Source: Where’s Your Ed At Date: 2026-05-08 URL: https://www.wheresyoured.at/premium-ais-circular-psychosis/

Summary

Ed Zitron argues that OpenAI and Anthropic together consume 70–80% of the AI compute revenue at all three hyperscalers (Amazon, Google, Microsoft), meaning the $748B infrastructure backlog depends almost entirely on two unprofitable companies. Anthropic raised $58B in eight months yet continues burning capital; the hyperscalers built roughly $300B of capacity primarily for these two customers, artificially inflating both demand metrics and their own stock valuations. Zitron contends there is no discovered GPU compute customer larger than $100M/year outside the major players, making the entire demand narrative circular.

Implications

• Token economics: The most detailed published attempt to quantify the concentration risk at the hyperscaler layer — if the 70–80% revenue share figure is accurate, the infrastructure build-out has no diversified demand base and no clear path to unit economics at current pricing.
• Enterprise deployment: The absence of large non-hyperscaler compute customers matters for enterprise adoption timelines; actual production workloads at scale remain thin relative to the infrastructure committed.
• Model landscape: Frames Anthropic’s capital raises not as growth investment but as operational dependency, which is relevant context for any roadmap assumption that Anthropic pricing or availability remains stable through 2026–2027.