AI Demand Drives Tech Price Hikes; Grok Chatbot Used for NSFW Content
Quick Look
- AI demand for data centers is causing price increases for Microsoft's Xbox and Surface, and Apple's MacBooks, Apple TV, HomePod, and Vision Pro.
- Separately, xAI's Grok chatbot reportedly sees "well over half" its traffic from NSFW activities, including generating porn and erotica, according to The Information.
AI-generated summary
Why It Matters
The AI boom has increased demand for memory-hungry data centers, leading to rising component costs that are now impacting consumer technology prices. xAI has promoted its Grok chatbot as having fewer guardrails than competitors.
As we were warned, that pesky AI boom and the resulting demand for memory-hungry data centers are hitting consumer tech. And it's hitting it hard.
Microsoft and Apple were the bringers of ill tidings and price rises. First up, Xbox Series X and S price jumps – one editor noted that his Series X and Series S, bought together, now cost $100 less than a Series X console. Also, this wasn't the first price increase, or even the second, for a gaming company struggling against PlayStation.
Microsoft also announced its new Surface laptops cost between $500 and $600 more than the models they're meant to replace. It's all a bit rich coming from Microsoft, too, one of the major investors in AI.
Then there's Apple, which has claimed it absorbed the costs of rising memory prices in recent years, but that's no longer the case. Punishingly, that includes a $100 bump to its new low-cost MacBook Neo. The increase scales with the machine's power, with the M3 Ultra Mac Studio going up by $1,300.
So far, there are no changes to iPhone prices, but the Apple TV 4K is now $199, up from $129, and the HomePod is $50 more expensive at $349. The Vision Pro headset now costs $3,699, up from $3,499.
If you were looking to get a new laptop, it might be wise to take another look at Prime Day deals. Or take a closer look at the refurb and pre-owned market.
xAI has long promoted Grok as a racier chatbot with fewer guardrails than other AI companies. We've seen that play out in some disastrous ways over the last year. It might just be a numbers game: NSFW activities account for "well over half" of Grok's traffic, according to a new report in The Information that cites two former employees of the SpaceX-owned company. That includes using Grok to generate actual porn, as well as "adult role-play chats" and "huge volumes of requests for erotica."
The report added that an internal analysis found that a "significant proportion of requests" to its coding model were for "porn or nude images", simply because it's cheaper to utilize that model than base Grok.
Open Questions
- How will these price increases affect consumer purchasing decisions?
- Will other tech companies follow suit with similar price hikes?
- What actions will xAI take regarding Grok's reported NSFW usage?
