Google “We have no moat, and neither does OpenAI”

The author talks about Koala but notes that ChatGPT is better. GPT-4 is then significantly better than GPT-3.5. If you've used all the models and can afford to spend money, you'd be insane to not use GPT-4 over all the other models.

Midjourney is more popular (from what I'm seeing) than Stable Diffusion at the moment because it's better at the moment. Midjourney is closed-source.

The point I'm wanting to make is that users will go to whoever has the best model. So, the winning strategy is whatever strategy allows your model to compound in quality faster and to continue to compound that growth in quality for longer.

Open source doesn't always win in producing better quality products.

Linux won in servers and supercomputing, but not in end user computing.

Open-source databases mostly won.

Chromium sorta won, but really Chrome.

Then in most other areas, closed-source has won.

So one takeaway might be that open-source will win in areas where the users are often software developers that can make improvements to the product they're using, and closed-source will win in other areas.

> While our models still hold a slight edge in terms of quality, the gap is closing astonishingly quickly. Open-source models are faster, more customizable, more private, and pound-for-pound more capable. They are doing things with $100 and 13B params that we struggle with at $10M and 540B. And they are doing so in weeks, not months.

> A tremendous outpouring of innovation followed, with just days between major developments (see The Timeline for the full breakdown). Here we are, barely a month later, and there are variants with instruction tuning, quantization, quality improvements, human evals, multimodality, RLHF, etc. etc. many of which build on each other.

> This recent progress has direct, immediate implications for our business strategy. Who would pay for a Google product with usage restrictions if there is a free, high quality alternative without them?

> Paradoxically, the one clear winner in all of this is Meta. Because the leaked model was theirs, they have effectively garnered an entire planet’s worth of free labor. Since most open source innovation is happening on top of their architecture, there is nothing stopping them from directly incorporating it into their products.

> And in the end, OpenAI doesn’t matter. They are making the same mistakes we are in their posture relative to open source, and their ability to maintain an edge is necessarily in question. Open source alternatives can and will eventually eclipse them unless they change their stance. In this respect, at least, we can make the first move.

[1] https://m.youtube.com/watch?v=rRi8LptvFZY