Comment by Analemma_

Comment by Analemma_ a day ago

5 replies

Not to mention nobody bothered chasing Amazon-- by the time potential competitors like Walmart realized what was up, it was way too late and Amazon had a 15-year head start. OpenAI had a head start with models for a bit, but now their models are basically as good (maybe a little better, maybe a little worse) than the ones from Anthropic and Google, so they can't stay still for a second. Not to mention switching costs are minimal: you just can't have much of a moat around a product which is fundamentally a "function (prompt: String): String", it can always be abstracted away, commoditized, and swapped out for a competitor.

robertjpayne 20 hours ago

This right here. AI has no moat and none of these companies has a product that isn't easily replaced by another provider.

Unless one of these companies really produces a leapfrog product or model that can't be replicated within a short timeframe I don't see how this changes.

Most of OpenAI's users are freeloaders and if they turn off the free plan they're just going to divert those users to Google.

  • aurareturn 11 hours ago

    AI has no moat - yet here I'm been paying for ChatGPT Plus since the very start.

mike_hearn 10 hours ago

Well, web search is also function(query: String): String in a sense, and that has one heck of a moat.

  • Analemma_ 5 hours ago

    Right, because just like the Amazon case, potential competitors didn't realize at the time what a threat it was, and so they gave Google a 15-year head start (Microsoft half-heartedly made "Live Search" circa 2007 and didn't really get at all serious about Bing until ~2010).

    That's very different from the world where everyone immediately realized what a threat Chat-GPT was and instantly began pouring billions into competitor products; if that had happened with search+adtech in 1998, I think Google would have had no moat and search would've been a commoditized "function (query: String): String" service.

Sateeshm 14 hours ago

It's not just the head start, it's the network effect.