Nice read, but I'd add an objection here: even if models don't improve any more, and they raise the standard subscription to 100$/month, I'd still buy it (and a lot of other people, I guess) because I'd extract far more value from it.
Why Everybody Is Losing Money On AI
51–60 of 117 posts
Re: Why Everybody Is Losing Money On AI
#52Does controversy cause articles to slide on HN? I noticed that this had more points in less time than several articles ranked above it, which surprises me a bit e.g. at time of writing a post about MentraOS has 11 points in 1 hour compared to this article's 51 in 53 minutes, but this is ranked 58th to Mentra's 6
Re: Why Everybody Is Losing Money On AI
#53I think Ed hits on an interesting point about the new user who spends $4 on a TODO file. Current LLM users are very enthusiastic about finding different models for different use cases and evaluating the cost-benefit of those models. But the average end user doesn't give a shit. If LLMs are going to "eat the world" they need to either be a lot better in the median case (bad prompts, bad model selection) or they need t…
> If LLMs are going to "eat the world" they need to either be a lot better in the median case (bad prompts, bad model selection) or they need to be so cost-effective that you can farm out your query to an ensemble and choose the result dialogue-tree-style. LLMs have been around for two years. it took decades before the PC really took hold.
2) Yes, they still have some time to fit the market better, but that doesn't change what they'll need to do to fit the market better.
Re: Why Everybody Is Losing Money On AI
#54Most people miss that they have almost a billion free users that are waiting to be monetized. Google makes 400B a year and it's crazy to think OpenAI can't achieve some percentage of that. Why would you slow down and let Google catch up for the sake of short term profitability.
Re: Why Everybody Is Losing Money On AI
#55Nice read, but I'd add an objection here: even if models don't improve any more, and they raise the standard subscription to 100$/month, I'd still buy it (and a lot of other people, I guess) because I'd extract far more value from it.
Re: Why Everybody Is Losing Money On AI
#56I think Ed hits on an interesting point about the new user who spends $4 on a TODO file. Current LLM users are very enthusiastic about finding different models for different use cases and evaluating the cost-benefit of those models. But the average end user doesn't give a shit. If LLMs are going to "eat the world" they need to either be a lot better in the median case (bad prompts, bad model selection) or they need t…
> If LLMs are going to "eat the world" they need to either be a lot better in the median case (bad prompts, bad model selection) or they need to be so cost-effective that you can farm out your query to an ensemble and choose the result dialogue-tree-style. LLMs have been around for two years. it took decades before the PC really took hold.
Re: Why Everybody Is Losing Money On AI
#57Does controversy cause articles to slide on HN? I noticed that this had more points in less time than several articles ranked above it, which surprises me a bit e.g. at time of writing a post about MentraOS has 11 points in 1 hour compared to this article's 51 in 53 minutes, but this is ranked 58th to Mentra's 6
It has dropped to 100th while the MentraOS post remains at 5th. Is HN pushing negative PR for AI down the ranks?
Dang, can we chat about collaborative filtering bubbles please?
Re: Why Everybody Is Losing Money On AI
#58The cost can be significantly reduced immediately and drastically if OpenAI or Anthropic were to choose to do so. By simply stopping the training of new models, profitability can be achieved on the same day. With the existing models, we have already substantial use cases, and there are numerous unexplored improvements beyond the LLM, tailored specifically to the use case.
Re: Why Everybody Is Losing Money On AI
#59What about Google? Anyone has any insights on their unit economics since they own the models and the infrastructure (which is also custom TPUs)? Are they doing better or are they in the same money losing business?
Re: Why Everybody Is Losing Money On AI
#60I think Ed hits on an interesting point about the new user who spends $4 on a TODO file. Current LLM users are very enthusiastic about finding different models for different use cases and evaluating the cost-benefit of those models. But the average end user doesn't give a shit. If LLMs are going to "eat the world" they need to either be a lot better in the median case (bad prompts, bad model selection) or they need t…
> If LLMs are going to "eat the world" they need to either be a lot better in the median case (bad prompts, bad model selection) or they need to be so cost-effective that you can farm out your query to an ensemble and choose the result dialogue-tree-style. LLMs have been around for two years. it took decades before the PC really took hold.
But virtually everybody has been using LLMs already. How long would it have taken for the PC if everybody had had the opportunity to use one for more than a year?