If these benches from their site hold up (they likely wont) Wouldn't this compress ai revenue like 15x quickly If they really have a 4.7 opus high equivalent at 1/16 the cost wouldn't this significantly effect all the current capex and planing Maybe they are getting elon to cover cost
The problem with this is that we do not know the actual cost. For all we know they might be pulling an Anthropic. Subsidizing costs to get users, then increasing them later on.
The real money furnace is the training, not just of models that get released, but also experimental training runs that fail to move benchmarks and are quietly thrown away. E.g. Cursor claim that 85% of the compute for Composer 2.5 comes from additional training on top of Kimi K2.5, where I'm not sure how they determined that, but it can't have been cheap. Then they say "Together with SpaceXAI, we're training a significantly larger model from scratch, using 10x more total compute."
So yes, they're probably attempting to replicate the Anthropic playbook of paying a large upfront cost for a very good model, and then rapidly acquiring paying customers, hoping that the inference margin will be enough to cover the training cost.