The Context Window Illusion
In May 2024, Google rolled out AI Overviews to hundreds of millions of search users. Within days, the system was telling people to add glue to pizza sauce (sourced from a decade-old Reddit joke) and to eat rocks for minerals (from a satirical Onion article republished on a geology company’s website).
Google had the largest information corpus ever assembled. The model was not the problem. The system could not tell a joke from a recipe.
Context rot
Context windows do not degrade gracefully. The research is consistent: as context grows, accuracy drops, latency spikes, and costs balloon. Models process beginnings and endings but barely touch what sits in the middle. Every model has a cliff, and that cliff comes well before the advertised maximum.
The problem is not performance. Performance you can measure. The problem is what happens to confidence when the context rots.
The confidence trap
The worst failures are not the glue-on-pizza moments. Those are obvious. The dangerous failures are the ones that sound right.
When Melanie Mitchell, an AI researcher at the Santa Fe Institute, asked Google how many Muslim presidents the US has had, AI Overviews answered: one, Barack Hussein Obama. The system cited an academic chapter analyzing the conspiracy theory as evidence for it. “Google’s AI system is not smart enough to figure out that this citation is not actually backing up the claim,” Mitchell said. The system did not flag uncertainty. It presented a confident answer with a scholarly citation.
Semantic entropy research from Nature (2024) explained why this is hard to catch: models express uncertainty by giving different answers to the same question, not by signaling low confidence. Users cannot detect this without specialized measurement.
This is why context window size is a trap. More information without better filtering does not produce better answers. It produces more confident wrong ones.
What works
Do not use the context window as a database. Build a pipeline: embed, search, rerank, compress, query. Each stage filters. The model sees a few thousand highly relevant tokens instead of hundreds of thousands of mostly-irrelevant ones.
Chunk size matters more than most teams realize. Chroma’s chunking evaluation found that retrieval with 200-400 token chunks achieved 88-90% recall. The optimal size varies by dataset and embedding model, but the direction is consistent: precision beats volume. Hybrid search (combining dense vector embeddings with BM25 sparse retrieval) outperforms either approach alone, and reranking results before they reach the primary model filters further.
If your system needs 200K tokens to answer a question, your retrieval is broken. The correct answer almost always fits in under 16K tokens when the semantic work is done right. A CLAUDE.md is the extreme version of this principle: a few hundred tokens of precisely curated context outperforms dumping the entire repository into the window.
Three failure modes
Context dumping. Symptom: “We put all our docs in the prompt.” Cost: Quadratic API spend, degraded accuracy, high-confidence hallucinations. Fix: Chunked retrieval with reranking. Do not let the model see irrelevant information.
Blind scaling. Symptom: “We upgraded to the million-token tier.” Cost: Quadratic compute scaling, hitting context rot thresholds. Fix: Compress context aggressively. Use the smallest window that works.
No validation. Symptom: “The model seems confident, ship it.” Cost: Invisible failures from corrupted or contradictory context. Fix: Semantic entropy checks, confidence calibration, citation verification.
What I am still figuring out
Whether retrieval pipelines just move the problem. Context dumping fails because the model processes irrelevant information. Chunked retrieval can fail because the chunking strategy drops relevant information. Both are context quality problems. The difference is that context dumping fails visibly (high cost, degraded answers) while retrieval failures are silent: the relevant chunk was never retrieved, so the model confidently answers from what it has. I am not sure the second failure mode is easier to detect than the first.
Google had the largest information corpus ever assembled. The context window was not the problem. What was in it was. An AI researcher asked how many Muslim presidents the US has had and got a confident, cited answer: one.
More context did not produce better answers. It produced more confident wrong ones. The engineering work is not expanding the window. It is filtering what enters it.