TechCheck Takes: The AI Boom's Multi-Billion Dollar Blind Spot 6/25/25

TechCheck

CNBC

Disruptors, Investing, Faang, Technology, Business, Management, Cnbc, Tech

4.8 • 56 Ratings

🗓️ 25 June 2025

⏱️ 12 minutes

🔗️ Recording | iTunes | RSS

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Summary

AI reasoning models were supposed to be the industry’s next leap, promising smarter systems able to tackle more complex problems. Now, a string of research is calling that into question. In June, a team of Apple researchers released a white paper titled “The Illusion of Thinking,” which found that once problems get complex enough, reasoning models stop working. Even more concerning, the models aren’t “generalizable,” meaning they might be just memorizing patterns instead of coming up with genuinely new solutions. Researchers at Salesforce, Anthropic, and other AI labs have also raised red flags. The constraints on reasoning could have major implications for the AI trade, businesses spending billions on AI, and even the timeline to superhuman intelligence.

Transcript

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0:00.0	Everyone's betting on AI getting smarter.
0:02.7	The amazing things they can reason.
0:04.2	We're just at the beginning of the reasoning AI era.
0:07.7	Smarter models, sharper intuition, super intelligence.
0:11.7	I think we'll get super intelligence, and I would guess that it will be a continuation of this trend
0:18.0	that humanity has been on for 100 plus years.
0:22.1	Fueling explosive new demand for compute.
0:25.0	The amount of computation necessary to do that reasoning process is 100 times more than what we used to do.
0:32.8	And companies going all in, spending billions just to avoid falling behind.
0:40.3	We now spend about $2 billion on AI. We have something like 600 actual in-use cases.
0:43.3	That number will probably double next year and maybe triple.
0:46.3	But what if it's all been over-promised?
0:48.3	And we're heading straight into a bottomless money pit.
0:52.3	New research is casting doubt on the hype.
0:54.9	In a new paper, they're throwing cold water
0:57.0	on the growing trend of reasoning models
0:59.5	and whether they're really more accurate.
1:01.2	Is the AI actually getting smarter?
1:03.4	Or is it just an illusion?
1:05.8	I'm Deirdrebosa with the tech check take,
1:08.0	AI's reasoning blind spot.
1:25.6	AI reasoning, it's the new frontier, the next supposed leap towards superintelligence.
	...

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