OpenAI declares 'code red' as Google catches up in AI race • Hacker News Board

Re: OpenAI declares 'code red' as Google catches up in AI race

#221

Post by karmasimida » Tue, Dec 02, 2025, 8:31 PM UTC

TechRemarker wrote: post #84

Heard all the news how Gemini 3 is passing everyone on benchmarks, so quickly tested and still find it a far cry from ChatGPT in real world use when testing questions on both platforms. But importantly the ChatGPT app experience at least for iPhone/Mac users is drastically superior vs Google which feels very Google still. So Gemini would have to be drastically better answer wise than ChatGPT to lure users from a bett…

Well I have been using Gemini and ChatGPT side by side for over 6 months now.

My experience is Gemini has significantly improved its UX and performs better that requires niche knowledge, think of some ancient gadgets that have been out of production for 4-5 decades. Gemini can produce reliable manuals, but ChatGPT hallucinates.

UX wise ChatGPT is still superior and for common queries it is still my go to. But for hard queries, I am team Gemini and it hasn’t failed me once

Re: OpenAI declares 'code red' as Google catches up in AI race

#222

Post by cheald » Tue, Dec 02, 2025, 8:31 PM UTC

ascorbic wrote: post #217

felixfurtak wrote: post #213

OpenAI is basically just Netscape at this point. An innovative product with no means of significant revenue generation. One one side it's up against large competitors with an already established user base and product line that can simply bundle their AI offerings into those products. Google will do just what Microsoft did with Internet Explorer and bundle Gemini in for 'Free' with their already other profitable produ…

> An innovative product with no means of significant revenue generation. OpenAI has annualized revenue of $20bn. That's not Google, but it's not insignificant.

And a $115b burn rate. They're toast if they can't figure out how to stay on top.

Re: OpenAI declares 'code red' as Google catches up in AI race

#223

Post by echelon » Tue, Dec 02, 2025, 8:31 PM UTC

ascorbic wrote: post #217

felixfurtak wrote: post #213

OpenAI is basically just Netscape at this point. An innovative product with no means of significant revenue generation. One one side it's up against large competitors with an already established user base and product line that can simply bundle their AI offerings into those products. Google will do just what Microsoft did with Internet Explorer and bundle Gemini in for 'Free' with their already other profitable produ…

> An innovative product with no means of significant revenue generation. OpenAI has annualized revenue of $20bn. That's not Google, but it's not insignificant.

Every F500 CEO told their team "have an AI strategy ASAP".

In a year, when the economy might be in worse shape, they'll ask their team if the AI thing is working out.

What do you think happens to all the enterprise OpenAI contracts at that point? (Especially if the same tech layperson CEOs keep reading Forbes and hearing Scott Galloway dump on OpenAI and call the AI thing a "bubble"?)

Re: OpenAI declares 'code red' as Google catches up in AI race

#224

Post by woopwoop » Tue, Dec 02, 2025, 8:31 PM UTC

felixfurtak wrote: post #213

OpenAI is basically just Netscape at this point. An innovative product with no means of significant revenue generation. One one side it's up against large competitors with an already established user base and product line that can simply bundle their AI offerings into those products. Google will do just what Microsoft did with Internet Explorer and bundle Gemini in for 'Free' with their already other profitable produ…

Maybe? But you could have written this same thing in 1999 with OpenAI and Google replaced by Google and Yahoo, respectively.

Re: OpenAI declares 'code red' as Google catches up in AI race

#225

Post by blueblisters » Tue, Dec 02, 2025, 8:32 PM UTC

ChatGPT seems like a huge distraction for OpenAI if their goal is transformative AI

IMO: the largest value creation from AGI won’t come from building a better shopping or travel assistant. The real pot of gold is in workflow / labor automation but obviously they can’t admit that openly.

Re: OpenAI declares 'code red' as Google catches up in AI race

#226

Post by edouard-harris » Tue, Dec 02, 2025, 8:32 PM UTC

felixfurtak wrote: post #213

OpenAI is basically just Netscape at this point. An innovative product with no means of significant revenue generation. One one side it's up against large competitors with an already established user base and product line that can simply bundle their AI offerings into those products. Google will do just what Microsoft did with Internet Explorer and bundle Gemini in for 'Free' with their already other profitable produ…

> with no means of significant revenue generation.

OpenAI will top $20 billion in ARR this year, which certainly seems like significant revenue generation. [1]

[1] https://www.cnbc.com/2025/11/06/sam-altman-says-openai-will-...

Re: OpenAI declares 'code red' as Google catches up in AI race

#227

Post by gaigalas » Tue, Dec 02, 2025, 8:32 PM UTC

another_twist wrote: post #181

gaigalas wrote: post #97

Earlier quoted context omitted.

> the industry will just collapse Wait, so all of that talk of ushering an era of innovation and new opportunities was just a lie, and the thing needs dinosaur-era stuff like ads and online shopping to survive? Seems disingenuous.

Ads have a very high profit margin. Ultimately we all get to cool shit because some consumer somehwere is buying something. Depending on whether you work in B2B or consumer software you are just a step closer or farther from the consumer. But ultimately its people who dont write code who decide the fate of the software industry.

> Ads have a very high profit margin.

I don't get it.

"AI is the new electricity", right? Disruptive. A new era.

The lightbulb company should be so disruptive that it completely occludes the huge profits of the old and obsolete candle business.

If your electricity company starts selling candles, something is wrong at a very deep conceptual level.

Re: OpenAI declares 'code red' as Google catches up in AI race

#228

Post by lateforwork » Tue, Dec 02, 2025, 8:32 PM UTC

OpenAI has already lined up enormous long-term commitments — over $500 billion through initiatives like Stargate for U.S. data centers, $250 billion in spending on Microsoft Azure cloud services, and tens of billions on AMD’s plan to deliver 6 GW of Instinct GPUs. Meanwhile, Oracle has financed its role in Stargate with at least $18 billion in corporate bonds plus another $9.6 billion in bank loans, and analysts expect its total capital need for these AI data centers could climb toward $100 billion.

The risk is straightforward: if OpenAI falls behind or can’t generate enough revenue to support these commitments, it would struggle to honor its long-term agreements. That failure would cascade. Oracle, for example, could be left with massive liabilities and no matching revenue stream, putting pressure on its ability to service the debt it already issued.

Given the scale and systemic importance of these projects — touching energy grids, semiconductor supply chains, and national competitiveness — it’s not hard to imagine a future where government intervention becomes necessary. Even though Altman insists he won’t seek a bailout, the incentives may shift if the alternative is a multi-company failure with national-security implications.

Re: OpenAI declares 'code red' as Google catches up in AI race

#229

Post by dist-epoch » Tue, Dec 02, 2025, 8:33 PM UTC

aftbit wrote: post #178

carlosjobim wrote: post #135

Earlier quoted context omitted.

If we stop for a while and really consider the value of AI tools, then comparing them on price doesn't make much sense. Any of these tools give hundreds, thousands, or tens of thousands of dollars of value per month to the user. With that in consideration they should mostly be compared on quality.

The same thing is true for a _ton_ of tech products. My home internet plan easily gives me more than $1000 in value per month. My cell phone hardware probably gives me $2000+ in value over even a short 2 year life. Customers still tend to choose the cheapest option that meets requirements.

Home internet and cell phones are fungible. AI is not.

If Internet would suddenly become $10k a month, maybe you would change country, or move to an office.

If AI would suddenly become $10k you can't do anything about it.

Re: OpenAI declares 'code red' as Google catches up in AI race

#230

Post by willis936 » Tue, Dec 02, 2025, 8:33 PM UTC

an0malous wrote: post #176

cmiles8 wrote: post #136

The real code red here is less that Google just one-upped OpenAI but that they demonstrated there’s no moat to be had here. Absent a major breakthrough all the major providers are just going to keep leapfrogging each other in the most expensive race to the bottom of all time. Good for tech, but a horrible business and financial picture for these companies.

> for these companies They’re absolutely going to get bailed out and socialize the losses somehow. They might just get a huge government contract instead of an explicit bailout, but they’ll weasel out of this one way or another and these huge circular deals are to ensure that.

This would trigger something that people in power would rather not trigger.