Cables2Clouds
Join Chris and Tim as they delve into the Cloud Networking world! The goal of this podcast is to help Network Engineers with their Cloud journey. Follow us on Twitter @Cables2Clouds | Co-Hosts Twitter Handles: Chris - @bgp_mane | Tim - @juangolbez
Cables2Clouds
Monthly News Update: When Your SD-WAN Gets More Frequent Flyer Miles Than You
The tech industry's shifting strategies and priorities take center stage in this episode as we examine several major developments reshaping the landscape. We dive into Ingram Micro's recent ransomware attack by the SafePay group, analyzing both the immediate impacts and potential long-term consequences of the four-day operational disruption. The incident raises important questions about security protocols, attack vectors, and the possibility of data exfiltration that could have lingering effects.
Next, we explore CoreWeave's massive $9 billion acquisition of CoreScientific, representing a fascinating pivot from cryptocurrency mining infrastructure to AI computing resources. This transaction epitomizes the tech industry's current trajectory – moving away from speculative cryptocurrency ventures toward equally speculative but potentially more productive AI applications. We discuss the diminishing returns of crypto mining versus the still-unprofitable but product-focused world of AI, questioning where this astronomical investment might lead.
The networking world sees significant realignment as Arista acquires VeloCloud from Broadcom, bolstering their WAN portfolio after VMware's SD-WAN solution changed hands multiple times in recent years. We compare potential integration approaches with Cisco's historical challenges integrating Viptela, speculating on how Arista might handle this transition while maintaining their commitment to a unified operating system.
Perhaps most concerning is Microsoft's continued workforce reduction – cutting 4% of employees while pledging billions toward AI development. This "robbing Peter to pay Paul" approach appears throughout the tech industry as companies bet heavily on AI's future promise while sacrificing present human capital. We contrast these widespread layoffs with contradictory reports claiming robust tech hiring, questioning the true state of industry employment.
Join us biweekly for future episodes as we transition to a fortnightly schedule focusing on quality over quantity. Share your thoughts about our schedule change or any topics discussed – we're especially interested in hearing from VeloCloud customers who've experienced the product's journey through multiple corporate owners.
Purchase Chris and Tim's new book on AWS Cloud Networking: https://www.amazon.com/Certified-Advanced-Networking-Certification-certification/dp/1835080839/
Check out the Fortnightly Cloud Networking News
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Hello and welcome back to another episode of the Cables to Clouds News Update, where Tim and I are going to go through some of the networking and cloud-adjacent tech news articles that have come out over the last couple of weeks and give our opinions and comments alike. It is a very dark and early Tuesday morning here in Sydney, Australia, and, I'm assuming temperament and beautiful afternoon Monday afternoon in Raleigh, North Carolina. But before we get into the news, I do want to take care of a couple of housekeeping items. Um, first of all, Tim, how are you doing?
Tim McConnaughy:What are we doing this now?
Chris Miles:Well, I just realized now that we don't work together anymore. I probably check in with you a little less than I, than I normally would as a as a coworker. So, yeah, what's new man? You man, you just went to japan yeah, yeah, I just got back.
Tim McConnaughy:Actually, I got a ton of uh pictures and stuff. Uh, I'm putting together some kind of post because everybody's asking me like, hey, how was it? And it's like I have so many pictures, I have so many stories, like I'm just not gonna type or say that a hundred times. So, yeah, I'll put something together and I'll post it. Uh, it was good though. I mean, I took the test, uh, took the jlpt n3. I was amazed by how many people were there, like that it was a convention hall filled with desks.
Tim McConnaughy:I could not believe how many people were there from different countries, um, so, like japanese, uh, nationals, uh natives rather, cannot take the jlpt like the provisions test for language. Uh, only foreigners basically. So it was all foreigners.
Chris Miles:So that's even crazier, that it was that well attended. Yeah, non-nationals yeah, yeah.
Tim McConnaughy:So I mean, if I did fail, it's probably because the listening section, because the listening section had a decent amount of echo because of the size of the of the room and everything I was. I I knew it was gonna be a problem. I just well, it is what it is, we'll see how it went. Um, I'm hopeful, but yeah, I, I will know if I pass. I probably just barely barely passed, which a pass is a pass. But uh, if I want to move on to the next level, then it's not gonna work anymore. They definitely make it a lot tighter per level. So we'll see, man, we'll see. But yeah, it's, it was good, it was nice being in the same time zone for a little bit of time, about 10 days or eight days or so.
Chris Miles:Yeah, yeah, that's true. Very rare occasion that we're on the same sleep schedule. So that was nice. Yeah, well, that's good. Good luck, I'm sure you'll pass with fine colors. We'll find out in a couple of months, I guess.
Chris Miles:But yeah, so before we get into it, another update from us here on the podcast. So Tim and I, just with our kind of ever busy schedules you know me starting a new job and Tim obviously has a lot of irons in the fire as well We've decided to push the show back to a fortnightly release for the overall show. So this includes our regular episodes as well as our news episodes. So you'll be getting a Cables to Clouds episode every two weeks versus every week that you're seeing now. So that will. I think we want to take a shift more towards focusing on quality of episodes rather than quantity of episodes, and with a weekly cadence it was starting to feel like we were rushing to make sure we were getting people in to record episodes and things like that, and I feel like the content was potentially suffering a little bit. So we want to shift back and make sure we can kind of have a little bit more thoughtful conversations and things like that. So we're going to be releasing on a bi-weekly or fortnightly cadence starting from this week. So 16th of July will be the start of that. So you'll get another episode two weeks after that. So just a little heads up and we'll let everybody know on social media as well. And if you have any comments or feedback on that, please reach out. I'm happy to hear from you guys as much as possible. So look forward to that.
Chris Miles:And with that out of the way, let's hop into the news. Let's see All right. So first up, we have an article here that was first brought to us by Bleeping Computer. So Ingram Micro, who is one of the world's largest IT distributors we actually do quite a bit of work here in Australia with them as well suffered a ransomware attack by a ransomware group called SafePay. So basically, back on the 5th of July they've kind of reported that there was a cybersecurity incident going on and that some of their internal systems had been compromised, and that's some of their internal systems had been compromised. There was the attack lasted over it sounds like about four, four days or so before they actually were able to resume their businesses or the businessgram systems.
Chris Miles:It's kind of confusing the timeline here because they came out and said initially that they thought someone had gotten in through compromised credentials over their global to protect VPN platform, which is kind of a VPN onboarding platform provided by Palo Alto Networks. And then Palo Alto Networks kind of commented that they were looking at the incident with Ingram as well, and then later there was a comment saying that the VPN gateways were not compromised using these password spray attacks that were called out in the attack as well. So I don't know exactly if that means that's not how the intruder got in or if that's just it wasn't a password spray attack and maybe it was just something that was a little bit more contained than that, but nonetheless it seems like this was a pretty serious attack. They were actually able to, or forced to, kind of shut down a certain sector of their operations. They were telling people to go home and work from home, although if the remote VPN was the platform that was compromised, I'm sure they shut that down too. So if you were potentially an employee of Ingram Micro, you might have been sitting at home twiddling your thumbs for a little while.
Chris Miles:So this seems like it's pretty serious. Wish the best to all involved. It doesn't seem like there's been any money that's exchanged hands here with regard to the ransomware attacks. So hopefully this is the last of it. But you know, sometimes when you hear that you know there hasn't been any exchange of funds, sometimes there's, you know, exploitation that comes out later due to data that was was compromised during the event. So yeah, so pretty rough one here. I'm glad to see them back in normal operations, though. Any comments from you, tim?
Tim McConnaughy:No, I agree. Any comments from you, tim? No, I agree. The timeline on the articles that we were reading as kind of published by Ingram and then collected in these articles was a little strange and it wasn't clear. I still, even now, they haven't been clear on exactly how the attack was successful. They did initially believe it was compromised credentials or password spray. Now Paolo specifically came out and said our global protect VPN was not compromised or VPN gateways were not compromised. But as a vendor, saying that your gateways were not compromised, that doesn't say that just means like the road was not compromised, but like the car could have been, you know, yeah for sure it could still have been and probably was.
Tim McConnaughy:Ultimately, you know, leaked or phished credentials, potentially that that gave them entrance into it, although you kind of wonder, you know, from a zero trust perspective, how leaked credentials could lead to a decent amount of especially apparently important enough computers to end up being, you know, ransomed. So maybe there was like a lack of zero trust in the and this would have been, I assume, on on Ingram side cause. Global protect VPN really just provides the access, you know, and then and then the policy based on how the company would have configured it Right. So yeah, it's. It's very unclear from the article, but I would assume Occam's Razor would suggest that, yeah, compromise, spearfish, potentially credentials, and then maybe a lack of true zero trust enforcement that would allow lateral movement or something like that that would let an attacker compromise and ransom multiple systems. I do agree with you that nowhere in here does it say anything about them paying the ransom. In fact, because they were down for something more like four days or something, it's far more likely that what they did was contain and then replace the compromised devices.
Tim McConnaughy:But yeah, good question Was there exfiltration that happened during that time that's going to have data sold on the dark web for recouping some of that money for the attack? Or are there other backdoors or something potentially that have been put in Because that could have happened? Maybe they picked some devices that they didn't ransom. Maybe they've kept them as backup root kits or something like that where they could come in back later. So I think time will tell. And this is the problem ultimately, whenever you're attacked by, whenever you suffer a cyber attack, is that it is truly difficult to really know how deep it goes. Right, like you know someone who has access to your systems. You know, the ransomware part might just be one method of trying to extract value from the attack, right? So yeah, I guess we'll see. Yeah, best of luck to Ingram, and hopefully they actually rooted it out and won't suffer any problems in the future.
Chris Miles:Yeah, for sure. I mean it seems like they did. I mean we've talked about cyber attacks on this show quite a bit and the thing is like these things are going to happen, you know, from time to time, and I mean it looks like they had a relatively good approach for, you know, instituting controls to stop some of that. Um, you know, instituting um controls to to to stop some of that.
Chris Miles:I think they did like a global reset of every employee's MFA across the entire company, which is, you know, probably not fun for the employees, but but uh, but it's good that they were able to do that Right, um, and that's uh, that's a way to at least kind of um stop the bleeding for a bit. So, um you know yeah, all the best.
Tim McConnaughy:Hopefully it works out okay. Okay, so the next story comes to us from Network World. Coreweave is acquiring Core Scientific. No relation I know that they both I guess they're now related, but previously no relation for $9 billion with a B, to quote unquote power their AI infrastructure push. Billion with a B dollars, to quote unquote power their AI infrastructure push. This is interesting. So CoreWeave is actually a publicly traded company that is an AI cloud, an AI backed cloud. Nvidia backs CoreWeave, like they're invested or whatnot in CoreWeave and they provide AI services, right, just as a on-demand AI services. So that's CoreWeave.
Tim McConnaughy:Now CoreWeave is buying a company called CoreScience CoreScientific, rather. Corescientific is actually a cryptocurrency mining operation. So you can already, you know, from a technology perspective, you can obviously see the value of an AI company acquiring a farm full of GPUs. So I think we talked about this a while ago, like how cryptocurrency farming and AI technology, if you will, the underpinning technology powering AI with GPUs are. First of all, they're both extremely power hungry. They're just like sucking the planet dry of resources but also how complimentary, you know, we were kind of talking about like who's going to win the gpu wars? Right? Like are we going to end up with with crypto miners as the winners, or is ai going to be the winners? I think we're seeing a definitive move towards ai.
Tim McConnaughy:Um, partially because, first of all, crypto has just been in the game a lot longer, and the thing with crypto is, the longer a coin exists, the harder it is to continue to mine that coin. So it's a what do they call it? A diminishing return. The whole thing is a diminishing return, so over time it has to get harder and the ROI, the return on investment there is worse. So the Network World article points out the like OK, so Quorum Scientific might have been struggling.
Tim McConnaughy:And then this is a good exit strategy for them as a company to just like cash out, essentially just get out of the game and I couldn't agree more. Honestly, if somebody's got $9 billion to throw at it, I couldn't imagine a better exit for that company. And then to just sell all your shit to ai and the overpowered, over, overblown, overpriced, uh time that you can sell it right, like well, it's as expensive as probably ever you know ever gonna be, and then and then exit. So yeah, we'll, we'll see. I mean, there's not much to see here. They sold it, so I guess we'll see um if these guys get their return on investment. That's the real question.
Chris Miles:Yeah, I mean, I guess, if you have somewhat of a cynic point of view, it's funny to see one technology that was new on the scene and promised to make people a lot of money now is getting bought by another new technology that promises to make a lot of people, a lot of money that still is not profitable, um, in roughly any capacity.
Chris Miles:So, um, some people are probably saying, oh well, what's the next thing? What's going to buy core weave and you know what. It's five, six years or something like that. Um, I mean not to be mean, but like it's I'm, I'm kind of glad to see some of the crypto mining and crypto adjacent stuff starting to be on the way out. Like it's I'm, I'm kind of glad to see some of the crypto mining and crypto adjacent stuff starting to be on the way out. Like it sounds like even, um, some of the blockchain technology stuff is is getting, yeah, um, overpowered by the um, by the quantum computing conversations nowadays, right, so it sounds like all of that is kind of being swept back under the rug. I don't know if it's going to die a fiery death or just slowly wither away, but yeah, it's just funny to see this happening, but yeah.
Tim McConnaughy:Yeah, it's like pure speculation buying pure speculation Like there's actually, at least there's an actual demonstrable product on the AI side of it Right, at least there's an actual demonstrable product on the AI side of it. You know, like versus Bitcoin or or cryptocurrency, which is truly like digging a hole in your backyard and just picking up rocks and telling everybody they're worth a lot of money. You know, like I don't, I don't know how else to you know, there truly is no actual product associated with blockchain besides the blockchain itself, right, which is, as we've seen, there's a lot of challenges, like proof of work and all this other stuff that makes actual consumption contracts and all of that blockchain technology actually not make a lot of sense for the most part, right. So, again, it's a product, it's pure speculation and at least AI has, even if it's not profitable, at least there's a demonstrable value proposition of product to be produced.
Tim McConnaughy:But, like you pointed out, like there's, it's still so far from profitability. I think they're still casting wide nets to try to figure out. Okay, well, how do we, as useful as all this is, how do we make it profitable versus the cost of production of bringing it to the market? So I think we're going to still be searching for that golden ticket for quite a while. So, yeah, maybe something will come, Maybe the next thing will come along and buy that. So I mean, there's a planet left. It's interesting.
Chris Miles:Yeah, we'll see if this kind of stuff and the stargate project and all that kind of there's just so much money being pumped into this shit, man, it's like, yeah, it's like amounts of money that we've never even had to like fathom in any capacity and and where's it coming from?
Tim McConnaughy:like truly, where is it?
Chris Miles:all coming from? Yeah, because the ai is not making any money yet. So like what? Yeah? Yeah, it's all speculation. So maybe we're due for another depression or something We'll see.
Tim McConnaughy:It is the 20s.
Chris Miles:Yeah, I know, right, it could happen, all right, moving on, so we've already talked about this a little bit on one of our past shows, but it was kind of just a rumored thing and now it seems it's uh, it's actually come to uh, come to fruition. But arista um has basically announced that they have um acquired, or starting to acquire uh velo cloud from broadcom um, which was uh previously, prior to being uh vmware being bought, um was a v, a VMware product as well, right? So VelaCloud is a Vela or VMware. It was VMware's SD-WAN offering that they had on the market was, you know, relatively wide adopted for a while, which is, I think, a good thing for Arista. I don't think they had a strong SD-WAN portfolio prior to this, so this will be something to kind of help round out their kind of WAN.
Chris Miles:I don't know if people would like people always have their unique names internally for what their products thing. So this is going to fit into that kind of WAN category and I think Arista has been very known for being prominent in the data center and maybe here and there from, you know, private clouds or even public clouds, et cetera. So I think this will be good to kind of expand their portfolio with the the way in as well, which is good. I got to say, man, it's like if you were, if you were, an OG VeloCloud customer, you. I'm curious to hear opinions from them on what this, what this ride has been like, like as if you came on being a VMware customer.
Chris Miles:I mean, let's be honest, like people that like VMware, that doesn't necessarily mean they're going to like anything offered by Broadcom or even Arista. Those are kind of the companies that have their very you know opinionated fans in certain capacities and ones that don't. So I'm sure they've been on a wild ride, uh, over the over the course of the past couple of years. Um, but yeah, so I think this is good. Um, I think it does leave a little bit of uncertainty on the table for, um, things like, apparently, broadcom and VeloCloud brought a SASE solution to the market as well, combining the SD-WAN and the Symantec offering from Broadcom, which was also under their umbrella. So I don't know if that's just going to kind of get the axe. I don't think it had an amazing amount of the market cap in the SASE world, but you know, I don't know what the future of that is going to look like. Maybe we'll have to look into that.
Chris Miles:And kind of on the back of this, they've also Arista have announced that they've announced or sorry, they've announced that they've hired a new COO in Todd Nightingale, who's coming over from Fastly. It's where he's been the CEO for the past three years. So I'll say he kind of comes across and say he's a networking person, he's excited to get back into kind of the networking world and things like that, which is good. I think he kind of worked his way up through the ranks at Cisco for many years, so he's kind of coming back into that camp, although probably working for someone that Cisco has not been too fond of for quite a while so that's kind of funny.
Chris Miles:But you know, here we are. I mean, I will say, with this VeloCloud acquisition, things like that, I think he's got his work cut out for him. He's got a lot of, um, you know, strategic execution that's going to need to, um, uh, kind of come to fruition and play out for arista in this part, but, um, yeah, overall I think it's a relatively good move for them and, uh, we'll have to see where it goes. But if you are, if you are an og velo cloud customer, when they were arista and now you've, you've, you've come in, uh, vmware when they were Arista and now you've come you mean VMware, sorry, vmware, yeah, sorry.
Chris Miles:VMware VeloCloud customer, and now you've made it through the ranks over to Arista. I'd be curious to hear opinions on what that transition has been like, so reach out to us.
Tim McConnaughy:Well, and more importantly, importantly, are you still like, because when vm, when broadcom bought, you know, vmware, um did they come out with a hey, your velo cloud is now 10 billion dollars. You know, like, did that happen?
Chris Miles:or yeah, maybe the maybe the bills will go. Maybe they went up 10x and maybe they'll come back down to, like you know, 2x or something it's so interesting because I think everybody I mean, how many times have we talked about this?
Tim McConnaughy:broadcom runs like a, like a uh, what's the word? A private equity firm? Right, yeah, broadcom works like a private equity firm. That's how they make their money. They act like a private equity firm. So them spinning off bellow cloud is not surprising in the least. It probably was not a huge money maker for um, it was probably one of those things where VMware had it, because it made loyal customers, kept in their ecosystem and provided a solution for them. But if you come in and you're like Broadcom, the PE company, you're looking at it and you're saying, well, this is a business unit we're paying for. That isn't making. You know, we can't charge a billion, million billion dollars for it, so let's just sell the business unit and focus on the parts that we can overcharge customers for.
Tim McConnaughy:So that's not a surprise? Actually I would not. I guess it makes sense. It's one of those things that after the fact you're like, yeah, that makes sense. But I wouldn't have thought at the time about Arista buying Velo, Because doesn't Arista have some weird like off the shelf, like something they built themselves for, like a STYN?
Chris Miles:Yeah, I think that's. The thing is Arista, like I said, being such a prominent vendor in the data center world, it's like I've never really heard too much about them having a. They have something. I know they do. They definitely did have something. I remember when this was rumored, I started looking up and they had something. But the thing is the way it was listed it was like was vague enough to where I just wouldn't understand if it was an SD-WAN product or not.
Tim McConnaughy:Yeah, you know what I mean Pathfinder, pathfinder, it was called Pathfinder. Yeah, it was part of the Cloud Vision thing. We did look this up when we first saw the rumors. I remember now that was a while back now, but yeah, pathfinder, they called it.
Chris Miles:I mean now they obviously have a very strong portfolio in the SD-WAN camp versus something that we weren't even sure was SD-WAN right. I mean SD-WAN has gotten to the point where it is table stakes.
Tim McConnaughy:It really is Right.
Chris Miles:So it's like you know, they talked about it. It really is like India, so to say a ton of MPLS still, but yeah, so I don't think it necessarily killed that, but it's definitely like you got to have your WAN has to have some sort of intelligence built into it now. So we're definitely at that point. So I think they, rather than you know, kind of being behind the eight ball on that. I think it's probably good to get something with as much recognition as VeloCloud.
Tim McConnaughy:Yeah, I wonder if they got it cheap as well. I mean relatively cheap, right? Relatively cheap, because I'm pretty sure Broadcom was trying to get rid of it. Like I said, they'll probably spin off other business units that aren't profit. They can't charge insane profit margins on anyway, because that's just their thing. So, yeah, maybe, maybe arista was like just opportunistic about it, like, hey, our pathfinder is okay, but we'd much rather have a I. So now it comes down to integration. Let's see, arista, what arista's integration strategy is and how they fix it and put it into their cloud vision or their, you know, their, their platform that they're using for all the other, uh, smart stuff that they're doing.
Chris Miles:I mean sadly. I wonder if this goes the exact same route or different route than Cisco, cisco, like, like. Arista is very yeah, cause Arista is very big on the unified operating system, right.
Tim McConnaughy:Like EOS. Eos is their is like their one is their one thing that runs pretty much most of their platform.
Chris Miles:Veloclide's obviously not going to run that, so it's like do you merge the two. Do you cause? That headache for people, or can you do it in a much better fashion than Cisco did? Are they going to learn the lesson? Yeah, I don't know.
Tim McConnaughy:Will they learn the lesson, because that really hurt that. That really hurt sdn adoption uh, waiting, waiting to backport it to uh ios xc. Now, ultimately, I think it did actually do well for the platform, like, I think, sdn, cisco, sdn is doing better, but at the time, with vitela being such a market leader, uh, the stakes are different. Now. Vitela is not a like velo cloud whatever, like sd-WAN doesn't have this race that it had either. Yeah, true, so like now, they could probably take their time. You know, they could just support existing customers and, in the background, with no pressure whatsoever, work on that integration. I think that's probably what we'll see.
Chris Miles:Yeah, I mean it feels like we're kind of poo-pooing Cisco. I think it was needed. They needed to do it. I think there was just some. I mean hindsight's always 20-20, I guess.
Tim McConnaughy:Oh, of course.
Tim McConnaughy:But, and knowing how the business units at Cisco are generally operated, I was not surprised. You know, I was at Cisco at the time. I was one of the you know, one of the people you know we had a that was working on it when it first launched, you know, within like a few months of the acquisition and, yeah, I mean it needed to happen.
Tim McConnaughy:I think a big complaint of customers, and even internally at the time, was that and this was this is all water under the bridge, right? Was that at the time, Vivitella had a lot of things planned that were new and exciting, and remember this is what six years ago now or something, almost five or six years now that it's been and a lot of new features at the time that were brand new features that were market-leading, going to be huge features that would really cement Vivitella as the leader at that time. Um, that really got put on the shelf, you know, and you know so that this could all be moved over to ios xc and so you had like a whole year where all the competition then was able to catch up and and and, like velo cloud being one of them, actually a great example of one of them I think that was when the acquisition happened.
Chris Miles:Right yeah, that's what.
Tim McConnaughy:I'm saying it's not the same world. Now my guess is that Arista will probably take their time and just support the existing customer base while they figure out how to do. But I do agree with you on the EOS thing. That is the kind of their One of their big, huge things is like hey, we've got ES one one, one operating system everywhere. So yeah, man, I think we will see it, but I don't. I don't think they have the pressure to deliver as quickly.
Chris Miles:I agree. Yeah Well, we'll have to see what they do. I think, I think this is. I mean, this is just the pains of an acquisition, right, this is what you have to go through, yeah.
Tim McConnaughy:So we'll, we'll keep our ear to the ground and we'll see what they end up doing. Speaking of the pains of technology, so our next article comes from Reuters and this is back in July 2nd. So this actually, I believe, has already happened. I've seen it on LinkedIn, a few people already saying like hey, I've been let go from Microsoft. So Microsoft was announcing they were going to lay off 4% of the workforce. Another cut Like Microsoft is just like chopping thousands and thousands of employees.
Chris Miles:Now they had said they were going to put like $9,000 per year to pay for the AI.
Tim McConnaughy:I think this did come out to be about $9,000. Yeah, yeah, and I think that's all, yeah, something like that. So, yeah, so they had pledged $80 billion in capital spending and then part of that was to pay for that was going to be cutting workforce. So this was and we reported on this when they announced, when they first announced it months ago and this is just like fruition. This is the next round, essentially, of something that we're already working on. So this is so interesting.
Tim McConnaughy:A lot of tech companies are doing this right, robbing Peter to pay Paul. Basically, they're cutting their headcount to pay for their expansion into AI. From the AI is going to be more than what they're going to lose in productivity and, and you know, whatever outcomes that they would from having human capital. Um, I, it's. I wish I knew or could understand what their thinking was here, because it's completely speculative, right, like there's been no actual there.
Tim McConnaughy:There's been, there's still, to this day, still now, there has been no indicator that ai is going to be profitable to the to the point of, like, what you're paying at laying out for it now, will it eventually become profitable? Maybe there has to be some micronization of technology. That's going to have to happen. You know, whatever, whatever, but it's still very much in the we've got a pitchfork and we're throwing money on the fire phase. Except in this case, it's not money we're throwing on the fire, it's essentially people, people's livelihoods anyway. But yeah, they're betting on this, and so is Meta and Google and Amazon. All the big tech giants are going through this motion to pay to basically keep up with the Joneses. So it's not sustainable. But yeah, but before we get into that just I wanted to there's one more article that I think is hilarious and we'll cover, you know, we'll talk about them together, and it's one that, according to Network World and I forget which. Let me just look real quick the I forget what it was.
Chris Miles:It was CompTIA.
Tim McConnaughy:CompTIA, that, and I forget which. Let me just look real quick the I forget what it was. It was CompTIA. Comptia, that's right. It was a CompTIA study saying that tech hiring exceeds expectations in June. So, like, literally, you have these two articles right next to each other saying that the tech unemployment rate fell slightly in June as companies listed 455,000 job listings for tech positions.
Tim McConnaughy:455,000 job listings for tech positions according to this tech jobs report. It really buries the lead on this, saying that, like, tech unemployment is low and it's lower than expected. And then it goes on to point out that, like, almost all of the new job postings are around AI, like people that know AI, people that are involved with AI, data science, et cetera, et cetera. So, and it also points out that those 455,000 listings are just listings. It's not really saying that, like, more people are being hired than fired or whatnot. It's just saying that, you know, exceeds the expectations, which 2.8% unemployment as opposed to 3.4% expected.
Tim McConnaughy:I think both of those numbers are completely wrong, by the way, like completely doctored numbers. You know they do that thing where when people stop, when people go off of unemployment, they don't count them as unemployed anymore, like you know what I mean Like that kind of like the net, like the way the federal government does it. So I really I look at this article, I look at this, this quote unquote study, and I'm just like sounds like complete bullshit to me, according to everything I've seen everywhere else. So, anyway, what do you have to add there? I know you got some thoughts about it.
Chris Miles:I mean it's back to the Microsoft thing. It's, I mean, we're talking about Microsoft here, right, it's one of the one of the biggest kind of global employers that exists on the planet, right? So when they talk about doing layoffs and purely to invest in AI, I think there's their justification. When they come to the table is probably gonna be around, not just like, hey, we need this capital just to fund AI. I think they're probably also. I mean, they're probably also doing the thing where they're like, oh well, we can actually get rid of this job and just let AI do it as well, right, so it's, I think, once we get into the conversation about tokens and things like that, that's consumed, maybe, maybe it does pay someone's salary, but nonetheless, yeah, man, it's like the tech, tech hiring, exceeding expectations article is also like you said.
Chris Miles:I'm a little bit skeptical on that because, like, there's no way to know if it was just companies like shuffling deck chairs around, things like that. Like it's. I mean, there's a lot of jurisdiction around whether or not you know when, when you're going to hire someone for a new position, you know the job post has to be made public for a certain amount of days, etc. Um, and we don't know like how many times have you been on the outside? You see a job post and you're like, oh, that looks amazing, I'm gonna apply for that. And then you, you like you're a perfect fit, you apply and you hear crickets and the thing was it was just earmarked for someone internally that you never got to see, etc.
Chris Miles:So I don't, I don't know, I wonder if, like if we are getting to that point where AI is, quote unquote, taking jobs, like I wonder if they're finding positions for people internally to do something else and obviously they have to make a posting for the position that they're going to move that person into, while their you know kind of rudimentary job was replaced by AI. But I mean, I don't know. I mean, obviously there's only so many people in the world, but tech is a growing employment sector, so it's like it's hard to not be skeptical about these numbers half the time when you see so many layoffs on LinkedIn and things like that. So, yeah, not much, you know, kind of uh, good commentary to add, but I think I'm with you, tim. I'm very skeptical, uh, about the um, uh, the reality of what this means.
Tim McConnaughy:It's uh well, and then you heard about. You hear about ghost jobs all the time, where companies are posting jobs that they never intend to fill just to look like they're growing, so that you know, know, wall street will, wall street will react favorably and like stuff like that there's, it's out, there, it's real. So somebody something I was looking at I don't forget what it was was estimating the actual unemployment rate is probably closer to actually like 20, which is nuts, which is nuts if you think about it. So, but but then you keep seeing like here's a thousand here, 9,000 people getting laid off from this company, here's 5,000 from this company. We're in the hundreds and hundreds and hundreds of thousands of laid off people until the last year now. So, yeah, actually, yeah, I can kind of see it.
Tim McConnaughy:You know, because all those people did not go get another job. You still see people looking for jobs all over the place.
Chris Miles:So yeah, maybe these jobs are being posted, for you know hackers in Korea.
Tim McConnaughy:That's right to come in and hack the network.
Chris Miles:Yeah, exactly, all right With that, we'll go ahead and wrap up the show. So thank you so much. If you stuck it out to the end, you must have enjoyed something along the way, so please share with a friend. We would love to expand the show and our listener base there, so we will go ahead and wrap it up and, like I said, we are moving this to a fortnightly cadence for the overall show, so you won't get another news update for about a month from today, and in two weeks we'll see you back here with a, an episode with kind of our standard episode with a guest and things like that, where we talk about an interesting topic. So with that, we'll take it away and we'll see you in a couple weeks. Goodbye.
