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GLM 5.2 and the coming AI margin collapse

martinalderson.com

331–340 of 495 posts

Re: GLM 5.2 and the coming AI margin collapse

#331
post #293

Earlier quoted context omitted.

Europe became powerful before it was unified, and ever since the creation of the EU it's been becoming less and less important on the world stage.

Yes, Europe was powerful when they had colonies. Currently, Europe can stand up against tech. Apple could easily prohibit iPhones from going into France but I doubt it cutting off the entire EU.

Stand up against tech? Cut off your nose to spite your face? Apple sure won’t care. Nor is Apple all encompassing of “tech”

Re: GLM 5.2 and the coming AI margin collapse

#332

Last month, I cancelled my Claude Pro subscription and instead used those 20$ to purchase Openrouter Credits. Most of my knowledge-seeking questions can be answered by Gemma4, for basic code editing, Qwen3.6 27b is enough, and for really difficult tasks, GLM5.2 doesn't leave me hanging. I'm by no means a heavy AI user, so I'm even saving money going the API Credit route and relying on the smallest possible model depe…

What do you use as interface to OpenRouter? I, too, am looking into using an API to see if I can reduce costs (I use OpenAI + Github Copilot, currently). TensorX instead of OpenRouter (because it's in Europe, and EURouter wanted 15% more money from me :P), but I'm not sure if I want to change a configuration in vscode every time I want to switch the model in the Claude extension (and having an API key in my settings…

I have OpenWebui hosted on my homelab, but you can also just have it live on your machine in a docker container. I honestly just embrace the iffy feeling. Openrouter has very good telemetry (which is partly why I went with them) and it'd be pretty easy to notice when someone other than myself uses my keys. For the little agentic coding I do I like to use OpenCode, and if I need to ask a question in my editor I use CodeCompanion (neovim AI chat plugin). I quickly went to check what OpenCode does with the API key, and it doesn't seem to store it in the user config, so that's at least something. But yeah, really recommend OpenWebui as a ChatGPT replacement (though there are a lot more alternatives out there, I just already knew owui from when I was playing around with local models)

Re: GLM 5.2 and the coming AI margin collapse

#333

Earlier quoted context omitted.

Agentic workloads are the most batch friendly, latency insensitive, geography insensitive, migration insensitive tokens that a big lab ever sells. In the ads business such inventory is called "remnant". The sausage is made of whatever is left over when the choice cuts have been removed. This talking point from Anthropic that Claude Code sitting in a Ralph Loop is burning top sirloin interactive session tokens is bad…

What are the choice cuts?

Interactive use cases: the web interface, the mobile interface, the design tool. The fast variants.

In an HBM bandwidth constrained setting you're dealing with something called "roofline analysis" (comes originally from NUMA work circa ~2009 but it's applicable to modern GPUs). Great diagram from the JAX people:

https://jax-ml.github.io/scaling-book/roofline/

In order to get your money's worth from a modern GPU (or disagg rack like an NVL72) you need to decode (the one token at a time thing) across big batches of context windows. To the left of that point where it hits "the roof" you're idling tensor units. TensorRT-LLM likes batches of 4096, so BS=4096.

In the case of one person chat prompting their local LLM, BS=1, totally bandwidth limited.

So the game is to set some latency target with some control theory primitive (PID or something) and then delay the next token until a batch is big enough to not waste tensor units. This is a real trick when a human is waiting (you've probably seen the thing in Claude.ai where it's all bursty and then they reflow the whole block with JavaScript).

Agentic workloads are huge piles of context windows where you've always got enough who want the same experts on the next token, you're always to the right of that intersection. And it doesn't really matter if it's on the other side of the world, or lags by a second, it's fine.

Claude Code soaks up all the tensor units that would be idle until they're full, and only then does it leak into the capacity reserved for highly interactive use. It's the bottom of the barrel until it's rinsed the fuck out.

They want more margin on agentic tokens. That's it. The COGS on them is the absolute lowest of anything they do.

Re: GLM 5.2 and the coming AI margin collapse

#334

Last month, I cancelled my Claude Pro subscription and instead used those 20$ to purchase Openrouter Credits. Most of my knowledge-seeking questions can be answered by Gemma4, for basic code editing, Qwen3.6 27b is enough, and for really difficult tasks, GLM5.2 doesn't leave me hanging. I'm by no means a heavy AI user, so I'm even saving money going the API Credit route and relying on the smallest possible model depe…

What do you use as interface to OpenRouter? I, too, am looking into using an API to see if I can reduce costs (I use OpenAI + Github Copilot, currently). TensorX instead of OpenRouter (because it's in Europe, and EURouter wanted 15% more money from me :P), but I'm not sure if I want to change a configuration in vscode every time I want to switch the model in the Claude extension (and having an API key in my settings…

I use Openwebui

Re: GLM 5.2 and the coming AI margin collapse

#335
post #282

Earlier quoted context omitted.

This is the conversation I plan to have with Okta sales soon. Wait till you see how easy AI makes it to switch to Entra ID or anyone else. It’s tedium not even problem solving.

My problem with the SSO providers is not the technical part, thats "easy". Its the coordinate with the 200+ external and internal vendors / support to redeploy the SSO part which is time consuming. I always say its a ~3 year project, which can be done in 6 months with the right amount of resources, especially if the platform has been running for years.

There are the handful that it’s not just a web console or API you interact with. Have to file a support ticket.

Those will be a pain.

Re: GLM 5.2 and the coming AI margin collapse

#336
post #5

I'm not convinced raw costs matter: 1. Compute costs collapsed since the advent of Cloud and yet hyperscalers still have fat margins. 2. Many open source office suites exist yet none compete with the ubiquity of gsuite or office. GitHub, Slack are similar examples. 3. Both Windows and macOS dominate the home desktop space despite free alternatives existing for a long time. 4. Many formerly open source infrastructure…

1,2,3 are dominated by platform stickness or even active lock-in. Can't say I see the same advantages to stop you switching the model you use. > It seems that enterprises will pay top dollar for service guarantees, integration, and someone they can sue. Sure. Though it does depend on whether you need regular updates. If you want the model to be aware of the latest research - then fine. However it already does the job…

This thread is riddled with buzz words - you know what im talking about.

just stop lmao.

Re: GLM 5.2 and the coming AI margin collapse

#337
post #134

Earlier quoted context omitted.

This is the conversation I plan to have with Okta sales soon. Wait till you see how easy AI makes it to switch to Entra ID or anyone else. It’s tedium not even problem solving.

though Okta is the first provider working on the enterprise mcp stuff.

It’s a new SKU. You’ll have to pay for that new type of app.

Re: GLM 5.2 and the coming AI margin collapse

#338

"There is no doubt that using Z.ai's official API and subscription is almost certainly a non-starter, with their terms being at best weak and the deep connection to Mainland China." This is the key statement in the article. I think people don't realize that these "open" weight models exist because giving away your product at a loss is a time honored marketing strategy. There's nothing guaranteeing that the next itera…

Well, Microsoft just started offering Kimi K2.7 through Copilot hosted on Azure.

https://github.blog/changelog/2026-07-01-kimi-k2-7-is-now-av...

Cursor Composer 2 and 2.5 are also fine tunes of Kimi K2.5

It looks like politics don't matter when it comes to economics.

Re: GLM 5.2 and the coming AI margin collapse

#339

Earlier quoted context omitted.

It's pretty annoying, yet somehow understendable. I sometimes get irrationally angry when being lectured by a clanker.

It's not understandable IMO, bad guys will still have guns.

Sure they will, but that doesn't mean that every bad guy should have nuclear weapon. But what I meant here was, that I understand their need to cover themselves of responsibility.

Re: GLM 5.2 and the coming AI margin collapse

#340

Earlier quoted context omitted.

Europe became powerful before it was unified, and ever since the creation of the EU it's been becoming less and less important on the world stage.

The motivation that the USA entered WWII was not because they were generous, but because the 3rd Reich was effectively becoming a big European nation, so they had to do something to avoid it. A unified Europe is a thread to the USA and Russia and maybe somebody else too.

> 3rd Reich was effectively becoming a big European nation

Even then the US might not have done much if the Nazis hadn’t kept attacking US shipping.

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