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OpenAI is too cheap to beat

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Re: OpenAI is too cheap to beat

#251

Post by paulddraper »

joefourier wrote: post #48
daft_pink wrote: post #7

I’m confused don’t a100s cost 10,000 to buy? Why would you pay 166k per year to rent?

AWS is extremely overpriced for nearly every service. I don’t know why anyone else outside of startups with VC money to burn or bigcos that need the “no one ever got fired for buying IBM” guarantee would use them. You’re better off with Lambdalabs or others which charge only $1.1/h per A100. Also that is a 8xA100 system as others have noted, but it is the 40GB one which can be found on eBay for as low as $3k if you g…

> AWS is extremely overpriced for nearly every service

S3 and EC2 are priced very competitively.

Your pricing only matters if you have availability.

Re: OpenAI is too cheap to beat

#252

Post by phillipcarter »

zarzavat wrote: post #129
Bukhmanizer wrote: post #103

Earlier quoted context omitted.

The bleeding obvious is that OpenAI is doing what most tech companies for the last 20 years have done. Offer the product for dirt cheap to kill off competition, then extract as much value from your users as possible by either mining data or hiking the price. I don’t understand how people are surprised by this anymore. So yeah, it’s the best option right now, when the company is burning through cash, but they’re plann…

OpenAI doesn’t own transformers, they didn’t even invent them. They just have the best one at this particular time. They have no moat. At some point, someone else will make a competitive model, if it’s Facebook then it might even be open source, and the industry will see price competition downwards .

> They just have the best one at this particular time

That is the moat. For developer platforms, it's all about building mindshare and adoption. The more people who know how to use OpenAI, the stronger OpenAI's position on the market. It doesn't matter if there's equivalent or slightly better models unless they start to fall significantly behind (and they're currently well in the lead).

Re: OpenAI is too cheap to beat

#253

Post by paulddraper »

charlie0 wrote: post #249
xmprt wrote: post #229

Earlier quoted context omitted.

Cabs are an idea. Uber is a company. I can't think of any company that I'd predict to last 100 years. Even Google and Apple probably won't last 100 years. I honestly wouldn't even bet on cars being a dominant form of transportation in 100 years.

I think Apple will last 100 years. See their latest AR product. They continue to create amazing products that are relevant to the masses.

You're probably right. But FWIW it's not even to the halfway mark yet.

Re: OpenAI is too cheap to beat

#254

Post by somsak2 »

appplication wrote: post #106

The premise of this is flawed. OpenAI is cheap because of has to be right now. They need to establish market dominance quickly, before competitors slide in. The winner of this horse race is not going to be the company with the best performing AI, it’s going to be the one who does the best job at creating an outstanding UX, ubiquitously presence, entrenching users, and building competitive moats that are not feature d…

I use Uber in SF all the time, and while it's absolutely more expensive than it was during those go-go years, it's actually an even better experience than it was before (specifically on how fast it is to get a driver near you).

Re: OpenAI is too cheap to beat

#256

Post by jokethrowaway »

vikramkr wrote: post #241
user3939382 wrote: post #223

Earlier quoted context omitted.

> The winner is going to be the consumers Cloud infra may be a comparable market, since computation is a big share of AI costs. Did consumers win big from competition between AWS, Azure, and GCP? Not sure. I see an uptick in write ups saying “We switched off cloud and reduced costs by 2/3rds.” Not a scientific sample but may leave the question open.

There are a HUGE number of startups that would have had a massively harder time if they had to roll their own infra. Who cares if the companies eventually have to move off? (Though even Netflix seems ok with it overall for now). There are a ton of services that just wouldn't exist otherwise

I disagree, at early startup scale you don't need much, you just buy a better VPS when you need to scale up

Learning aws vs learning how to operate a vps are of comparable complexity

It took me less then a day to setup infra for my startup (more than 10 years ago)

Re: OpenAI is too cheap to beat

#257

Post by Turing_Machine »

outlace wrote: post #185
appplication wrote: post #106

The premise of this is flawed. OpenAI is cheap because of has to be right now. They need to establish market dominance quickly, before competitors slide in. The winner of this horse race is not going to be the company with the best performing AI, it’s going to be the one who does the best job at creating an outstanding UX, ubiquitously presence, entrenching users, and building competitive moats that are not feature d…

But OpenAI appears to have some sort of data moat. I doubt their model is the best in the world, but more/better data generally beats better model, and GPT-4 definitely beats Claude, Bard, Bernie and the rest probably because they curated the best quality and largest data set. Maybe that moat doesn't last long but perhaps they have exclusive rights to some of that dataset through commercial agreements that could be a…

I'd bet that there are any number of submarine startups out there sitting on top of full downloads of Common Crawl, archive.org, etc. who are only too happy to let OpenAI be the first penguin off the iceberg.

If OpenAI survives all the legal challenges, they'll just click "Go" and be in business in weeks to months.

If OpenAI gets smacked down, they haven't lost much.

There are probably also some submarine operations that are already doing/have done the training. If OpenAI gets bankrupted for copyright violations, we'll just never hear from those.

Re: OpenAI is too cheap to beat

#258

Post by jokethrowaway »

sangnoir wrote: post #201
outlace wrote: post #185

Earlier quoted context omitted.

But OpenAI appears to have some sort of data moat. I doubt their model is the best in the world, but more/better data generally beats better model, and GPT-4 definitely beats Claude, Bard, Bernie and the rest probably because they curated the best quality and largest data set. Maybe that moat doesn't last long but perhaps they have exclusive rights to some of that dataset through commercial agreements that could be a…

> But OpenAI appears to have some sort of data moat. I'm willing to bet dollars to doughnuts that Google and Facebook have at least one, possibly 2 or more orders of magnitude more latent training data to work with - not including Googles search index. My uninformed opinion is that Google and Meta's ML efforts are fragmented - with lots of serious effort going into increasing existing revenue streams with LLMs and th…

I'm sure some people at google and meta were screaming at the top of their lungs to jump on the ai bandwagon before chatgpt - but you know how things work in large companies.

They're not as good at innovating, that's why they acquire startups all the time. It's a blood transfusion

Re: OpenAI is too cheap to beat

#259

Post by Turing_Machine »

CSMastermind wrote: post #240
sangnoir wrote: post #201

Earlier quoted context omitted.

> But OpenAI appears to have some sort of data moat. I'm willing to bet dollars to doughnuts that Google and Facebook have at least one, possibly 2 or more orders of magnitude more latent training data to work with - not including Googles search index. My uninformed opinion is that Google and Meta's ML efforts are fragmented - with lots of serious effort going into increasing existing revenue streams with LLMs and th…

> My uninformed opinion is that Google and Meta's ML efforts are fragmented - It seems more likely that at Google at least they just fell into the classic innovator's dilemma in which they were stuck trying to apply innovation to their current business models in an attempt at incremental innovation instead of seeking an entirely different customer and market.

Yeah, same with Meta.

Both have a large graveyard of failed innovation attempts. Remember Google Buzz? Google Plus?

Re: OpenAI is too cheap to beat

#260

Post by serial_dev »

xmprt wrote: post #229
noah_buddy wrote: post #222

Earlier quoted context omitted.

It’s a funny point. After only taking Ubers and Lyfts all my adult life (young), I have recently switched to cabs because they are cheaper in my city (and I tell everyone I know to do the same). They have dominance now but if I had to guess whether cabs or Uber will still exist in 100 years… I know which I would bet on.

Cabs are an idea. Uber is a company. I can't think of any company that I'd predict to last 100 years. Even Google and Apple probably won't last 100 years. I honestly wouldn't even bet on cars being a dominant form of transportation in 100 years.

> Even Google and Apple probably won't last 100 years.

I'm not sure, there are 100+ yo companies like Kodak, Nikon, IBM, Panasonic, GSK, Merck, etc. With that in mind, it's not hard for me to imagine that some of the tech giants will also have a presence in hundred years, maybe not as dominant as today, but they could survive.

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