Why Did Big Tech Stop Building Useful Products?

Key takeaways

Many companies are now focusing on inventing the future rather than improving the present because it boosts their valuation and attractiveness to investors.
Tesla’s rocket-powered Roadster demo is a spectacle designed to generate attention and excitement, not a market-ready product.
AI companies emphasize impressive benchmarks and rogue agent demos to appear as having vast potential, even when these don’t translate into practical benefits.
Silicon Valley’s reliance on engagement and attention as a currency drives companies to prioritize spectacle over usefulness.
Creating genuinely useful products that significantly improve lives is difficult; most companies lack the expertise or are unwilling to invest the necessary resources.
The focus on spectacle and future invention creates economic bubbles and misallocations that can harm consumers and the economy.
Consumers should demand products that actually improve their lives now, instead of supporting companies that prioritize hype and spectacle.
A shift in consumer mindset toward valuing usefulness over disruption could help realign the industry towards more beneficial innovation.

Summary

Introduction: From integrated devices to spectacle demos

The episode begins with the host reflecting on the evolution of technology from the multi-functional device concept exemplified by the iPhone, introduced by Steve Jobs, to present-day spectacles like Tesla's rocket-powered Roadster demo. The host contrasts Jobs' focus on demonstrating how new products would immediately improve users' lives with recent tech showcases that seem more like circus acts, designed to dazzle rather than serve practical needs. He questions why many companies now prioritize inventing spectacular futures over creating products that actually enhance daily life, hinting at a shift in industry focus.

Why are companies focused on inventing the future?

The host explores three reasons behind this trend. The first, derived from Corey Doctrow, is that companies aim to be perceived as growth companies to achieve higher valuations and attract early-stage investment. Tesla, for instance, invests heavily in visually impressive demos that are not necessarily market-ready products but serve to project innovation, raising its market valuation. Similarly, AI companies emphasize futuristic demos and abstract benchmarks to appear as having vast growth potential, boosting their chances of an IPO and higher valuation without necessarily delivering immediate consumer benefits.

Engagement and attention as drivers of innovation focus

The second explanation involves Silicon Valley's deep reliance on user engagement for financial success. The host discusses how social media and online attention are central to many tech firms' strategies, with engagement serving as a currency. For personality-driven figures like Elon Musk, spectacle and meme-worthiness—such as Tesla's Roadster demo—are tools to generate buzz and maintain relevance. This focus on engagement fuels a preference for disruptive, future-oriented projects over practical, immediately useful products because spectacle drives attention and discussion.

The difficulty of building useful products

The third factor concerns the difficulty of creating genuinely useful products that significantly improve users’ lives. The host argues that Steve Jobs' success was exceptional and that most companies, especially in AI, lack the product design expertise to do this effectively. Instead, they focus on impressive demos and benchmarks that show technological prowess but don’t necessarily translate into real-world benefits. Examples include AI founders who lacked the background in product development, leading to a reliance on hype and spectacle because actual useful product creation is challenging.

Consequences of this trend and possible solutions

The host discusses how this emphasis on inventing the future over improving the present creates economic and societal risks, including bubbles in AI and data centers, and a misallocation of resources. Consumers are hurt as they face higher risks and fewer tangible benefits. The suggested response is for consumers to demand products that make their lives better now, rather than engaging in or supporting spectacle-focused innovation. The host encourages a mindset shift where people prioritize practical, useful products and challenge tech companies to focus less on ego-driven disruption and more on real-world impact.

Show notes

Tesla’s recent demo of a rocket-powered Roadster doing a kick-flick over a parked car touched a nerve in me. It seemed to epitomize changes to the tech sector in recent years that have been largely negative. In this short episode, I jump on the mic to explain some of my developing thoughts surrounding these ideas.