AI Arms Race Volume: 11

AI is not a good as you are, but that does not stop it destroying your job by theft

A great company with an in demand product has had to shed 75% of its employees

We have long been of the opinion that AI will not turn super-human anytime soon, and the events of 2025 proved us correct (so far). However, as our sister project, VSP-ai.org, has been warning for some time, AI does not need to outperform humans to displace them. It only needs to be good enough.

This week a great technology company called Tailwind was forced to lay off 75% of its workforce after revenue collapsed by 80%. What makes this especially disturbing is that the product Tailwind created is booming. In fact, there’s a good chance you’re using it frequently whenever you view content on the Internet.

How can this happen?

The uncomfortable answer is this: AI has absorbed Tailwind’s knowledge. While it can not perform at the same level as the people who lost their jobs, most users will not notice or care about the drop in quality.

AI theft of this nature is a major problem that currently has no solution

Let’s be clear, what is happening here is theft.

The AI revolution differs from past technological shifts. For example, when railroads replaced horse‑drawn transport, the new technology was superior and created new industries to replace the old ones. What is happening now is different. AI does not replace companies like Tailwind; it needs and depends on them. AI can only advance by absorbing their work, and in doing so, destroys the very sources it needs. AI steals economic value.

If this continues unchecked, we risk a dangerous form of stagnation:

1. People and companies stop creating new ideas because AI immediately appropriates them.
2. With fewer new ideas, AI itself can no longer get the new knowledge it needs to improve.

More on why AI is not as good as you are

Worried about AI’s effect on society? Wondering where you’ll fit in in the AI era? Trying to understand what AI actually is? The ChatBar AI team highly recommend this excellent video for you and in fact anybody that uses AI in any form – essentially, anybody with a phone or computer: