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

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

#801

Post by rglullis »

threeducks wrote: post #768
rglullis wrote: post #744

Earlier quoted context omitted.

It's not the open models that suck, it's the infrastructure around them. None of current "open weights providers" have: - good tools for agentic workflows - no tools for context management - infrastructure for input token caching These are solvable without having to pay anything to OpenAI/Anthropic/Google.

Why would the open weights providers need their own tools for agentic workflows when you can just plug their OpenAI-compatible API URL into existing tools? Also, there are many providers of open source models with caching (Moonshot AI, Groq, DeepSeek, FireWorks AI, MiniMax): https://openrouter.ai/docs/guides/best-practices/prompt-cach...

> when you can just plug their OpenAI-compatible API URL into existing tools?

Only the self-hosting diehards will bother with that. Those that want to compete with Claude Code, Gemini CLI, Codex et caterva will have to provide the whole package and do it a price point that is competitive even with low volumes - which is hard to do because the big LLM providers are all subsidizing their offerings.

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

#802

Post by thaumasiotes »

qdotme wrote: post #797
matwood wrote: post #708

Earlier quoted context omitted.

Are you saying that Google, Meta, Amazon, etc... can't do software? It's the bread and butter of these companies. The CUDA moat is important to hold off the likes of AMD, but hardware like TPUs for internal use or other big software makers is not a big hurdle. Of course Huang will lean on the software being key because he sees the hardware competition catching up.

Essentially, yes, they haven’t done deep software. Netflix probably comes closest amongst FAANG. Google, Meta, Amazon do “shallow and broad” software. They are quite fast at capturing new markets swiftly, they frequently repackage OpenSource core and add the large amount of business logic to make it work, but essentially follow the market cycles - they hire and layoff on a few year cycle, and the people who work ther…

But the first example sigmoid10 gave of a company that can't do software was Microsoft.

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

#803

Post by safety1st »

bloppe wrote: post #318
bgirard wrote: post #290

Earlier quoted context omitted.

It's a fun trope to repeat but that's not what OpenAI is doing. I get a ton of value from ChatGPT and Codex from my subscription. As long as the inference is not done at a lost this analogy doesn't hold. They're not paying me to use it. They are generating output that is very valuable to me. Much more than my subscription cost. I've been able to help setup cross app automation for my partner's business, remodel my ho…

To be fair, I would get a ton of value out of someone selling dollars for 20 cents apiece. But ya, OAI is clearly making a ton of revenue. That doesn't mean it's a good business, though. Giving them a 20 year horizon, shareholders will be very upset unless the firm can deliver about a trillion in profit , not revenue, to justify the 100B (so far) in investment, and that would barely beat the long term s&p 500 average…

The whole US economy is so deep into La-La Land at this point that they don't really need to be a good business. There are already murmurings that they may pull off a trillion dollar IPO, I don't see why they wouldn't, Amazon was making it cool to lose money hand over fist during your IPO as far back as 1997. They have the President willing to pump up their joint ventures with executive orders, we may just see tech become more like the financial industry, where a handful of companies are dubbed "too big to fail" based on political connections, and get bailed out at the taxpayer's expense when things get too rough. None of these guys function according to the real rules of the economy or even the legal system at this point, they just make stuff up as they go along and if they're big enough or know someone big enough they often get away with it.

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

#804

Post by mrweasel »

atonse wrote: post #546
steveBK123 wrote: post #314

Earlier quoted context omitted.

If the subscription cost 5x as much would you still pay and feel you are getting such a great value?

I pay $100/month for Claude Max, and I've already said it, I would go up to $500 a month and wouldn't hesitate for a second. I'd probably start to hesitate for $1,000 maybe, only cuz I know I wouldn't be able to use it enough to maximize that value. But I might still suck it up and pay for it (I don't use it enough yet to need the $200/month but if I started hitting limits faster, I would upgrade), or at that point s…

95% of ChatGPT users aren't paying customers, if they won't pay $10 per month, there's zero chance of them paying $100 or $500.

That's not to say that there aren't many, like you, for whom $500 is a perfectly good deal, there's just not nearly enough for OpenAI to ever turn a profit.

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

#805

Post by mrwrong »

bgirard wrote: post #290
stack_framer wrote: post #247

Earlier quoted context omitted.

I can generate $20 billion in ARR this year too! I just need you to give me $100 billion and allow me to sell each of your dollars for 0.2 dollars.

It's a fun trope to repeat but that's not what OpenAI is doing. I get a ton of value from ChatGPT and Codex from my subscription. As long as the inference is not done at a lost this analogy doesn't hold. They're not paying me to use it. They are generating output that is very valuable to me. Much more than my subscription cost. I've been able to help setup cross app automation for my partner's business, remodel my ho…

> I've been able to help setup cross app automation for my partner's business, remodel my house, plan a trip of Japan and assist with the cultural barrier, vibe code apps, technical support and so much more.

you could have done all of this without a chatbot.

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

#806

Post by segmondy »

Title should really be OpenAI declares 'code red' as OpenAI falls behind in the AI race. Google, Anthropic, Mistral, DeepSeek, Tencent, Alibaba, Moonshot, Zai, etc have all made great strides. OpenAI has been falling behind in terms of velocity while everyone else is moving faster

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

#807

Post by farseer »

Glemkloksdjf wrote: post #766
matwood wrote: post #683

Earlier quoted context omitted.

As others mentioned, 5T isn't money available to NVDA. It could leverage that to buy a TPU company in an all stock deal though. The bigger issue is that entering a 'race' implies a race to the bottom. I've noted this before, but one of NVDA's biggest risks is that its primary customers are also technical, also make hardware, also have money, and clearly see NVDA's margin (70% gross!!, 50%+ profit) as something they w…

Nvidia has everything they need to build the most advanced GPU Chip in the world and mass produce it. Everything. They can easily just do this for more optimized Chips. "easily" in sense of that wouldn't require that much investment. Nvidia knows how to invest and has done this for a long time. Their Ominiverse or robots platform isaac are all epxensive. Nvidia has 10x more software engineers than AMD

They still go to TSMC for fab, and so does everyone else.

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

#808

Post by whywhywhywhy »

matwood wrote: post #708
sigmoid10 wrote: post #688

Earlier quoted context omitted.

Making the hardware is actually the easy part. Everyone and their uncle who had some cash have tried by now: Microsoft, Meta, Tesla, Huawei, Amazon, Intel - the list goes on and on. But Nvidia is not a chip company. Huang himself said they are mostly a software company. And that is how they were able to build a gigantic moat. Because noone else has even come close on the software side. Google is the only one who has…

Are you saying that Google, Meta, Amazon, etc... can't do software? It's the bread and butter of these companies. The CUDA moat is important to hold off the likes of AMD, but hardware like TPUs for internal use or other big software makers is not a big hurdle. Of course Huang will lean on the software being key because he sees the hardware competition catching up.

If CUDA were as trivial to replicate as you say then Nvidia wouldn’t be what it is today.

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

#809

Post by deaux »

rsanek wrote: post #752
verdverm wrote: post #712

Earlier quoted context omitted.

ChatGPT is losing their brand positioning to Google, Anthropic, and Chinese Open Source Altman knows this and why he called code red. If OpenAI hasn't produce a fully new model in 1.5 years, how much longer can they hang on before people will turn to alternatives that are technically better? How long before they could feasibly put out a new model if they are having issues in pre-training?

They're losing their benchmark lead to those companies. But no chance that your average user is even aware of Anthropic, much less OSS models. The brand is mostly fine IMO, it's the product that needs to catch up.

You conveniently left out their main competitor, Google, there.
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