It’s all Bleak and Bleary for Big Tech

Tech giants, which once controlled and commanded the tech world, are on their knees. Their trillion dollars inflated worth of skeletons are now tumbling out of the closet since the recession hit the market.

And in this hour of crisis, it's the employees who have taken the fall. Most of the 200,000 employees laid off since last year were from Silicon Valley-based tech giants. We are just 23 days into 2023, and over 55,000 employees have been laid off this year alone. So, how did the big techs land in this hot soup? 

Basking in the pandemic

While the pandemic hit the world hard and traditional businesses were completely gone, companies like Meta, Google, Amazon and others made huge profits. In the first three months of 2021, Amazon reported $108.5 billion in sales, up 44 percent from a year earlier. It also posted $8.1 billion in profit, an increase of 220 percent from the same period last year.

Similarly, between 2020 and 2021, Google’s revenues grew by 70% from $180 billion to $256 billion. The demand for their products and services was so high that they had to hire an extra workforce. Meta’s workforce, too, grew by 28% in a year. It was all hunky-dory till reality hit them in the face. 

Will they step up to the plate?

The tech giants’ trillions of dollars worth was a mirage. Meta’s revenue grew by 50% in the summer of 2021 and sharply declined over the nine months. It grew only by 5% in the first quarter of 2022.

Amazon’s revenue dropped by 40% to 7% in the same time span. Alphabet's (Google’s parent company) profits were at $13.9 billion, down from $18.9 billion in Q3 2021. From 1995 to 2015, Amazon created a meagre $2.5 billion profit, but the company reached $ 1 trillion worth. 

Rather than focusing on profitability, they focused on growth.

Meanwhile, the World Bank’s latest analysis paints a bleak picture of a rapidly falling global economy, with worldwide output projected to be around just 1.7% in 2023. Moreover, the World Bank and International Monetary Fund (IMF) have cautioned that the downturn will be far-reaching, and any negative developments could send the global economy spiralling into a recession.

MORE CORE

Why We Need Better CPUs

Over the past decade, the enterprise hardware market has seen a trend towards more ‘cores’ in CPUs, driven by market leaders like AMD and Intel, with the focus being on scalability and advantages for cloud service providers. However, HPC (high-performance computing) customers such as IBM, Atos, Oracle, and HPE are now seeking more than just increased core counts and are demanding better CPUs.

Read the full story here.

INTERVIEW

Infosys Tackles Cyber Security of India

Vishal Salvi has spent three decades in the IT industry and has seen cybersecurity become a top priority for enterprises. He currently serves as the chief information security officer and head of cyber security practice at Infosys, and for the past six years, he has helped enterprises strengthen their cybersecurity frameworks. 

He spoke with Analytics India Magazine about the services that Infosys Cyber Security provides and the transformation of the cybersecurity sector.

Read the full interview here.

CHATGPT

Human Feedback Declined

OpenAI's GPT-3.5 architecture, which powers ChatGPT, uses a reinforcement learning from human feedback model (RLHF) to improve its responses in real-time based on human input. However, this system has also had consequences, as it may prioritise being rewarded for achieving a desired outcome over having a definite understanding of what is right. Cambridge University mathematician Sarah Rasmussen illustrated this.

Read the full story here.