Comment by Havoc

Comment by Havoc a day ago

I'd be pretty worried as a shareholder. Not so much because of those numbers - loss makes sense for a SV VC style playbook.

...but rather that they're doing that while Chinese competitors are releasing models in vaguely similar ballpark under Apache license.

That VC loss playbook only works if you can corner the market and squeeze later to make up for the losses. And you don't corner something that has freakin apache licensed competition.

I suspect that's why the SORA release has social media style vibes. Seeking network effects to fix this strategic dilemma.

To be clear I still think they're #1 technically...but the gap feels too small strategically. And they know it. That recent pivot to a linkedin competitor? SORA with socials? They're scrambling on market fit even though they lead on tech

indymike a day ago

> but rather that they're doing that while Chinese competitors are releasing models in vaguely similar ballpark under Apache license.

The LLM isn't 100% of the product... the open source is just part. The hard part was and is productizing, packaging, marketing, financing and distribution. A model by itself is just one part of the puzzle, free or otherwise. In other words, my uncle Bill and my mother can and do use ChatGPT. Fill in the blank open-source model? Maybe as a feature in another product.

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Havoc a day ago

>my uncle Bill and my mother can and do use ChatGPT.
They have the name brand for sure. And that is worth a lot.
Notice how Deepseek went from a nobody to making mainstream news though. The only thing people like more than a trusted thing is being able to tell their friends about this amazing cheap good alternative they "discovered".
It's good to be #1 mind share wise but without network effect that still leave you vulnerable

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- senordevnyc 18 hours ago
  
  I know almost no one outside of tech who has used anything other than ChatGPT. And I know few people under 65 who aren’t using ChatGPT.
  
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  Sateeshm 14 hours ago
  
  This was my observation too for a while. But I'm seeing a lot of non-tech people using Gemini
  
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rchaud 20 hours ago

> In other words, my uncle Bill and my mother can and do use ChatGPT
So what? DAUs don't mean anything if there isn't an ad product attached to it. Regular people aren't paying for ChatGPT, and even if they did, the price would need to be several multiples of what Netflix charges to break even.

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avbanks a day ago

I don't think people fully realize how good the open source models are and how easy it is to switch.

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whizzter a day ago

My input to our recent AI strategy workshop was basically:
- OpenAI,etc will go bankrupt (unless one manages to capture search from a struggling Google)
- We will have a new AI winter with corresponding research slowdown like in the 1980s when funding dries up
- Opensource LLM instances will be deployed to properly manage privacy concerns.

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- gizmodo59 a day ago
  
  99% of the world doesn’t care a dime about oss. It’s all saas and what you host behind the saas is only a concern for enterprise (and not every enterprise). And openai or Anthropic can just stop training and host oss models as well.
  
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  whizzter 5 hours ago
  
  Everyone cares about OSS as in "free", the capital spending of AI firms and market capitalization hinges on the concept that they will save enterprises tons of money by off-sourcing employees.
  You think we have these crazy valuations because the market thinks that OpenAI will make joe-schmoe buy enough of their services? (Them introducing "shopping" into the service honestly feels like a bit of a panicky move to target Google).
  We're prototyping some LLM assisted products, but right now the cost-model isn't entirely there since we need to use more expensive models to get good results that leaves a small margin, spinning up a moderately sized VM would probably be more cost effective option and more people will probably run into this and start creating easy to setup models/service-VM's (maybe not just yet, but it'll come).
  Sure they could start hosting things themselves, but what's stopping anyone from finding a cheaper but "good enough" alternative?
  
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- yunwal 21 hours ago
  
  Barring a complete economic collapse, one of the big tech cos will 100% buy ChatGPT if OpenAI goes bankrupt
  
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beepbopboopp a day ago

Eh, distribution of the model is the real moat, theyre doing 700m WAU of the most financially valuable users on earth. If they truly become search, commerce and can use their model either via build or license across b2b, theyre the largest company on earth many times over.

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Havoc a day ago

>distribution of the model is the real moat, theyre doing 700m WAU of the most financially valuable users on earth.
Distribution isn't a moat if the thing being distributed is easily substitutable. Everything under the sun is OAI API compatible these days.
700 WAU are fickle AF when a competitor offers a comparable product for half the price.
Moat needs to be something more durable. Cheaper, Better, some other value added tie in (hardware / better UI / memory). There needs to be some edge here. And their obvious edge - raw tech superiority...is looking slim.

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- gizmodo59 a day ago
  
  Not necessarily. I’m sure there is many cheaper android phones that are technically better in specs but many users won’t change. Once you are familiar, bought into the ecosystem getting rid of it is very hard. I’m lazy myself compared to how I was several years ago. The curious and experimental folks are a minority and the majority ll stick with what works initially instead of constantly analyzing what’s best all the time
  
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  byzantinegene 18 hours ago
  
  you could argue that for apple devices, but openAI products have none of that ecosystem
  
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