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The OpenAI graveyard: All the deals and products that haven't happened

forbes.com

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Re: The OpenAI graveyard: All the deals and products that haven't happened

#131

Post by chromacity »

Hansenq wrote: post #122

Lots of critiques here! Something missing in this discussion is people asking _why_ it is that they're doing this. The people who work there aren't stupid! I think this is a disconnect between people who think that large companies are static entities with established products vs. large companies that still operate like a startup and are trying to grow. When you're building your business from $0 in revenue, you don't…

I'm not sure your criticism is quite fair. I think everyone here is willing to cut more slack to the underdog. But when your company represents an outsized chunk of the digital economy and employs 10k+ people, and only then says "sooo, let's try to build some sort of a profitable product here", I can see why people are rolling their eyes.

OpenAI also burned a lot of goodwill by pretending to be a nonprofit foundation focused on the betterment of mankind and then executing one of the most spectacular rugpulls in modern history. So yeah, people will be giving them a hard time even if it turns out that the valuation is justified.

Re: The OpenAI graveyard: All the deals and products that haven't happened

#132

Post by bombcar »

nope1000 wrote: post #107
MengerSponge wrote: post #94

Earlier quoted context omitted.

Making existing models more efficient won't make them God in a Box.

True but neither will going bankrupt.

They're all in a race to bankrupt the others, and then pivot and raise prices and go efficient fast enough to avoid their own bankruptcy.

We'll see if it works!

Re: The OpenAI graveyard: All the deals and products that haven't happened

#133

Post by bombcar »

delecti wrote: post #83
rchaud wrote: post #79

Earlier quoted context omitted.

Google launched in 1998 and were running ads by 2000. Considering how much more access to adtech product talent there is for OAI a quarter of a century on, what explains their hesitation to pick that route and make billions? After all they had billions avaiable to acquire designer bauble maker Jony Ive's company.

The first AI company to cram their product full of ads will get roasted over the coals for it. My guess is they're all playing chicken and waiting to be the second to do it. I'd also guess that they're all already thinking about ways to introduce it that will generate the least backlash. Google could do it in 2000 because their search was legitimately so much better, and also because their ads were comparatively more…

People forget it took Google years of frog-boiling to get us to where we are now.

The first AI to insert blatant ads will be dumped for some other model overnight. Look at the Copilot "backlash" over their "product announcements".

Re: The OpenAI graveyard: All the deals and products that haven't happened

#134

Post by bombcar »

steveBK123 wrote: post #51
adventured wrote: post #33

Earlier quoted context omitted.

AWS is legitimately a giant and it should be considered in enterprise broadly. It's infrastructure more than enterprise software of course, which is where Anthropic is at. Anthropic is not trying to host the world's databases and services (at present anyway). Anthropic will however help you write software to compete with Salesforce, Oracle, SAP, et al. Google's ad business remains far larger and more profitable than…

I guess the question is how many more $100B of ad sales slots are available, aside from just stealing share from incumbents (who already took it from traditional media channels over last 20 years). At some point someone needs to add value to the real economy, not just take an ad tax off the top.

I don't think advertising is entirely a zero-sum game (there is real value to everyone for steveBK123 to learn of a product that actually solves a real need or saves money, etc) - but it has to be something akin to it - the economy can't support five hundred trillion dollars in advertising spend.

Re: The OpenAI graveyard: All the deals and products that haven't happened

#135

Post by bombcar »

guzfip wrote: post #113
et-al wrote: post #32

Earlier quoted context omitted.

Keep in mind this is a Forbes "Site", so basically a personal blog with some minor vetting.

Interesting. I never had much of an opinionon Forbes till a few years ago I noticed them posting nearly exclusively NYPost style clickbait. I didn’t think it was that bad of a publication.

Forbes "the publication" is still around somewhere and has some standards.

Forbes "sites" are just the bastard love child of LinkedIn, Medium, and Substack, and should be treated with the respect that deserves.

Re: The OpenAI graveyard: All the deals and products that haven't happened

#136

Post by bdangubic »

harmonic18374 wrote: post #88
bdangubic wrote: post #45

Earlier quoted context omitted.

it is a simple stance - if you have a product that is used by hundreds of millions of people ad monetization strategy will be found cause there are people a lot smarter than you and me that will get it done. here’s intellectual challenge - find a business with comparable number of users to openai which is not swimming in ad revenue - one will do

Snapchat

Total Quarterly Revenue (Q4 2024): $1.55 billion in total revenue, with $1.41 billion coming from advertising

Basically all their revenue is ad revenue and not too bad

Re: The OpenAI graveyard: All the deals and products that haven't happened

#137

Post by zer00eyz »

operatingthetan wrote: post #14
adventured wrote: post #10

Earlier quoted context omitted.

The LLM usage will generate hundreds of billions of dollars in ad revenue, which will be wildly lucrative in terms of margins (not as good as Google search used to be). If GPT is a leader in that, they'll take a sizable share of that pot. There's a lot more money in being Google -> consumer ads, or Amazon -> consumer ads, or Meta -> consumer ads, than there is in being Anthropic -> enterprise. Just take a look at the…

>The LLM usage will generate hundreds of billions of dollars in ad revenue, which will be wildly lucrative in terms of margins (not as good as Google search used to be). This seems like ... not the situation we are in. LLMs are great for coding now but their text generation capabilities aren't exactly capturing the masses or replacing their jobs yet. People are already tired of the deluge of fake content on the inter…

> The $20-200 LLM plans are all subsidized and aren't paying for themselves. Something has to give here.

Expert systems were amazing. They were not cost effective.

There might be another bitter lesson to be had here, and unless the accountants start talking we're not gonna know any time soon.

Re: The OpenAI graveyard: All the deals and products that haven't happened

#138

Post by bdangubic »

adventured wrote: post #53
iAMkenough wrote: post #37

Earlier quoted context omitted.

At that time, Facebook provided a free service without any real competitors. The masses will switch to Meta AI or Gemini or Claude at the drop of an ad that annoys them enough.

Gemini, GPT and Claude will all have ads on the consumer side. They will go together in quasi lock-step into the ad future, because that money is gigantic and they're going to need it. The masses will have no say in the matter. Just as they had no say in the matter with Google's ads getting ever more intrusive, or cable prices previously, or streaming prices going perpetually higher in the present, or YouTube ads, or…

amazing this is even a debate, we have now decades of this across everything that reaches enough users, it is a certainty as much that the Sun will rise tomorrow morning. as probably many people here on HN I am designated computer-fixer for all my family so any family gathering I have to look at someone's computer about something. years ago I started checking whether browser(s) anything ad-blocking in place and I am 0 for million by now. while HN crowd might be theoretically pushing back on ads (even with like "I won't use this if there are ads" nonsense) general public is so used to ads that I sometimes feel it is welcomed change when some new service etc gets ads. I remember the first time I saw an ad on Amazon Prime Video and my daughter and I were like "no f'ing way!!!" and my wife was like "oh, ____ is on sale this weekend, cool!" :)

Re: The OpenAI graveyard: All the deals and products that haven't happened

#139

Post by ifwinterco »

cmiles8 wrote: post #12
Mistletoe wrote: post #8

Has there ever been a period o time where people saw a bubble coming and that we were in one, but it just inexorably refused to pop/drug out this long? This isn’t a rhetorical question, I’m wondering how this period compares to other irrational periods of the economy like railroad fever etc.

It’s not been that long really. The dot com bubble was called a bubble for a while before it finally imploded. And just like now folks were in massive denial that it was a bubble. One of the challenges here is that a lot of folks simply weren’t around then and haven’t seen what happens when everything implodes overnight. Those that have experienced it know what that looks like and know it will happen again.

What makes this time weird though is back then (and in most bubbles) the bubble was creating jobs - supposedly (I'm too young) anyone who could write a bit of HTML could get hired in the dot com boom.

Whereas this is a very weird bubble where it creates big pumps in some equity prices but apart from a tiny number of people who are directly involved in AI research etc. it's not created any jobs, in fact by creating uncertainty it's probably caused fewer jobs to be created.

What that means for labour market dynamics when it pops I really don't know

Re: The OpenAI graveyard: All the deals and products that haven't happened

#140

Post by ifwinterco »

simianwords wrote: post #61
Mistletoe wrote: post #8

Has there ever been a period o time where people saw a bubble coming and that we were in one, but it just inexorably refused to pop/drug out this long? This isn’t a rhetorical question, I’m wondering how this period compares to other irrational periods of the economy like railroad fever etc.

The bubble bursting has almost become eschatological for deniers. Keep praying that it will happen. It won't.

LLMs can be a massively transformative and valuable technology, and this would still be a bubble, there's no reason those two things can't be true at once.

In fact "pure" bubbles where the focus item is of literally no value (tulips, NFTs) are quite rare. Much more common are the bubbles based on an actual real transformative innovation (canals, railways, radio, internet, LLMs).

Railways did absolutely transform how travel worked in the UK, while simultaneously almost everyone who invested in them lost their shirts

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