Where AI products break (hallucinations, trust, cost)

AI products have their own failure modes

Every product can break. AI products break in some specific ways that traditional software doesn’t. Knowing those failure modes lets you design around them — and helps you spot the warning signs in your own product before they damage trust.

This topic walks through the three most common categories of AI product breakage: hallucinations, trust collapse, and cost surprises. Each has shown up across many AI products. Each is preventable with care.

Hallucinations: confident wrongness

Hallucinations are the term for AI models producing plausible-sounding but incorrect output. A made-up fact. A non-existent source. A confidently-stated answer that turns out to be wrong on closer inspection.

Hallucinations aren’t bugs in the traditional sense. They’re a pr...

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