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OpenAI dropped the price of o3 by 80%

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Re: OpenAI dropped the price of o3 by 80%

#81

Post by JamesBarney »

lispisok wrote: post #18
behnamoh wrote: post #10

how do we know it's not a quantized version of o3? what's stopping these firms from announcing the full model to perform well on the benchmarks and then gradually quantizing it (first at Q8 so no one notices, then Q6, then Q4, ...). I have a suspicion that's how they were able to get gpt-4-turbo so fast. In practice, I found it inferior to the original GPT-4 but the company probably benchmaxxed the hell out of the tu…

I swear every time a new model is released it's great at first but then performance gets worse over time. I figured they were fine-tuning it to get rid of bad output which also nerfed the really good output. Now I'm wondering if they were quantizing it.

I'm pretty sure this is just a psychological phenomenon. When a new model is released all the capabilities the new model has that the old model lacks are very salient. This makes it seem amazing. Then you get used to the model, push it to the frontier, and suddenly the most salient memories of the new model are it's failures.

There are tons of benchmarks that don't show any regressions. Even small and unpublished ones rarely show regressions.

Re: OpenAI dropped the price of o3 by 80%

#82

Post by fasterthanlime »

baq wrote: post #66
nabla9 wrote: post #33

Earlier quoted context omitted.

It seems that least Google is overselling their compute capacity. You pay monthly fee, but Gemini is completely jammed 5-6 hours when North America is working.

Gemini is simply that good. I’m trying out Claude 4 every now and then and go back to Gemini to fix its mess…

Funny, I have the exact opposite experience! I use Claude to fix Gemini’s mess.

Re: OpenAI dropped the price of o3 by 80%

#83

Post by minimaxir »

joshuajooste05 wrote: post #41
candiddevmike wrote: post #16

It's going to be a race to the bottom, they have no moat.

There was an article on here a week or two ago on batch inference. Do you not think that batch inference gives at least a bit of a moat whereby unit costs fall with more prompts per unit of time, especially if models get more complicated and larger in the future?

Batch inference is not exclusive to OpenAI.

Re: OpenAI dropped the price of o3 by 80%

#84

Post by ants_everywhere »

behnamoh wrote: post #10

how do we know it's not a quantized version of o3? what's stopping these firms from announcing the full model to perform well on the benchmarks and then gradually quantizing it (first at Q8 so no one notices, then Q6, then Q4, ...). I have a suspicion that's how they were able to get gpt-4-turbo so fast. In practice, I found it inferior to the original GPT-4 but the company probably benchmaxxed the hell out of the tu…

Is this what happened to Gemini 2.5 Pro? It used to be very good, but it's started struggling on basic tasks.

The thing that gets me is it seems to be lying about fetching a web page. It will say things are there that were never on any version of the page and it sometimes takes multiple screenshots of the page to convince it that it's wrong.

Re: OpenAI dropped the price of o3 by 80%

#86

Post by hgomersall »

baq wrote: post #66
nabla9 wrote: post #33

Earlier quoted context omitted.

It seems that least Google is overselling their compute capacity. You pay monthly fee, but Gemini is completely jammed 5-6 hours when North America is working.

Gemini is simply that good. I’m trying out Claude 4 every now and then and go back to Gemini to fix its mess…

I heard that, but I'm getting consistent garbage from Gemini.

Re: OpenAI dropped the price of o3 by 80%

#87

Post by jstummbillig »

behnamoh wrote: post #10

how do we know it's not a quantized version of o3? what's stopping these firms from announcing the full model to perform well on the benchmarks and then gradually quantizing it (first at Q8 so no one notices, then Q6, then Q4, ...). I have a suspicion that's how they were able to get gpt-4-turbo so fast. In practice, I found it inferior to the original GPT-4 but the company probably benchmaxxed the hell out of the tu…

You can just give it a go for very little money (in Windsurf it's 1x right now), and see what it does. There is no room for conspiracy here, because you can simple look at what it does. If you don't like it, so won't others, and then people will not use it. People are obviously very capable of (collectively) forming opinions on models, and then vote with their wallet.

Re: OpenAI dropped the price of o3 by 80%

#88

Post by resters »

behnamoh wrote: post #10

how do we know it's not a quantized version of o3? what's stopping these firms from announcing the full model to perform well on the benchmarks and then gradually quantizing it (first at Q8 so no one notices, then Q6, then Q4, ...). I have a suspicion that's how they were able to get gpt-4-turbo so fast. In practice, I found it inferior to the original GPT-4 but the company probably benchmaxxed the hell out of the tu…

It's probably optimized in some way, but if the optimizations degrade performance, let's hope it is reflected in various benchmarks. One alternative hypothesis is that it's the same model, but in the early days they make it think "harder" and run a meta-process to collect training data for reinforcement learning for use on future models.

Re: OpenAI dropped the price of o3 by 80%

#89

Post by Zaheer »

seydor wrote: post #78
coffeecoders wrote: post #51

Despite the popular take that LLMs have no moat and are burning cash, I find OpenAI's situation really promising. Just yesterday, they reported an annualized revenue run rate of 10B. Their last funding round in March valued them at 300B. Despite losing 5B last year, they are growing really fast - 30x revenue with over 500M active users. It reminds me a lot of Uber in its earlier years—fast growth, heavy investment, b…

their moat is leaky because llm prices will be dropping forever and the only viable model will be a free model. Eventually everyone will catch up. Plus there is the thing that "thinking models" can't really solve complex tasks / aren't really as good as they are believed to be .

I would wager most of their revenue is from the subscriptions - both consumer and business. That pricing is detached from the API pricing. The heavy emphasis on applications more recently is because they realize this as well.

Re: OpenAI dropped the price of o3 by 80%

#90

Post by symfoniq »

fasterthanlime wrote: post #82
baq wrote: post #66

Earlier quoted context omitted.

Gemini is simply that good. I’m trying out Claude 4 every now and then and go back to Gemini to fix its mess…

Funny, I have the exact opposite experience! I use Claude to fix Gemini’s mess.

Maybe LLMs just make messes.
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