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OpenAI's cash burn will be one of the big bubble questions of 2026

economist.com

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Re: OpenAI's cash burn will be one of the big bubble questions of 2026

#241

Post by famouswaffles »

doctaj wrote: post #56
adriand wrote: post #30

This article doesn’t add anything to what we know already. It’s still an open question what happens with the labs this coming year, but I personally think Anthropic’s focus on coding represents the clearest path to subscriber-based success (typical SaaS) whereas OpenAI has a clear opportunity with advertising. Both of these paths could be very lucrative. Meanwhile I expect Google will continue to struggle with making…

What Google AI products do people not want to use? Gemini is catching up to chatpt from a MAU perspective, ai overviews in search are super popular and staggeringly more used than any other ai-based product out there, a Google ai mode has decent usage, and Google Lens has surprisingly high usage. These products together dwarf everyone else out there by like 10x.

>Gemini is catching up to chatpt from a MAU perspective

It is far behind, and GPT hasn't exactly stopped growing either. Weekly Active Users, Monthly visits...Gemini is nowhere near. They're comfortably second, but second is still well below first.

>ai overviews in search are super popular and staggeringly more used than any other ai-based product out there

Is it ? How would you even know ? It's a forced feature you can not opt out of or not use. I ignore AI overviews, but would still count as a 'user' to you.

Re: OpenAI's cash burn will be one of the big bubble questions of 2026

#242

Post by johnnyanmac »

password54321 wrote: post #49

Not sure why they put so much investment into videoSlop and imageSlop. Anthropic seems to be more focused at least.

because these are mostly the same players of the 2010's. So when they can't get more investor money and the hard problems are still being cracked, the easiest fallback is the same social media slop they used to become successful 10-15 years prior. Falling back on old ways to maximize engagement and grind out (eventually) ad revenue.

Re: OpenAI's cash burn will be one of the big bubble questions of 2026

#243

Post by bjt »

gizmodo59 wrote: post #225
jeffbee wrote: post #88

For what I use them for, the LLM market has become a two player game, and the players are Anthropic and Google. So I find it quite interesting that OpenAI is still the default assumption of the leader.

Only in HN and some reddit subs I even see the name claude. In many countries AI=ChatGPT.

And at one point in the 90s, Internet=Netscape Navigator.

I see Google doing to OpenAI today what Microsoft did to Netscape back then, using their dominant position across multiple channels (browser, search, Android) to leverage their way ahead of the first mover.

Re: OpenAI's cash burn will be one of the big bubble questions of 2026

#244

Post by loloquwowndueo »

fooblaster wrote: post #160
avalys wrote: post #139

AI is going to be a highly-competitive, extremely capital-intensive commodity market that ends up in a race to the bottom competing on cost and efficiency of delivering models that have all reached the same asymptotic performance in the sense of intelligence, reasoning, etc. The simple evidence for this is that everyone who has invested the same resources in AI has produced roughly the same result. OpenAI, Anthropic,…

There is a pretty big moat for Google: extreme amounts of video data on their existing services and absolutely no dependence on Nvidia and it's 90% margin.

In this case the difference between its and it’s does alter the meaning of the sentence.

Re: OpenAI's cash burn will be one of the big bubble questions of 2026

#245

Post by odo1242 »

Ginden wrote: post #132
password54321 wrote: post #49

Not sure why they put so much investment into videoSlop and imageSlop. Anthropic seems to be more focused at least.

Because almost everyone involved in AI race grew up in "winner takes it all" environments, typical for software, and they try really hard to make it reality. This means your model should do everything to just take 90% of market share, or at least 90% of specific niche. The problem is, they can't find the moat, despite searching very hard, whatever you bake into your AI, your competitors will be able to replicate in f…

It's also why they bought 40% of the world's RAM supply, too

Re: OpenAI's cash burn will be one of the big bubble questions of 2026

#246

Post by api »

avalys wrote: post #139

AI is going to be a highly-competitive, extremely capital-intensive commodity market that ends up in a race to the bottom competing on cost and efficiency of delivering models that have all reached the same asymptotic performance in the sense of intelligence, reasoning, etc. The simple evidence for this is that everyone who has invested the same resources in AI has produced roughly the same result. OpenAI, Anthropic,…

If performance indeed asymptotes, and if we are not at the end of silicon scaling or decreasing cost of compute, then it will eventually be possible to run the very best models at home on reasonably priced hardware.

Eventually the curves cross. Eventually the computer you can get for, say, $2000, becomes able to run the best models in existence.

The only way this doesn’t happen is if models do not asymptote or if computers stop getting cheaper per unit compute and storage.

This wouldn’t mean everyone would actually do this. Only sophisticated or privacy conscious people would. But what it would mean is that AI is cheap and commodity and there is no moat in just making or running models or in owning the best infrastructure for them.

Re: OpenAI's cash burn will be one of the big bubble questions of 2026

#247

Post by famouswaffles »

Analemma_ wrote: post #205
PeterHolzwarth wrote: post #121

Earlier quoted context omitted.

Yes, but that is the standard methodology for startups in their boost phase. Burn vast piles of cash to acquire users, then find out at the end if a profitable business can be made of it.

Most startups have big upfront capital costs and big customer acquisition costs, but small or zero marginal costs and COGS, and eventually the capital costs can slow down. That's why spending big and burning money to get a big customer base is the standard startup methodology. But OpenAI doesn't have tiny COGS: inference is expensive as fuck. And they can't stop capex spending on training because they'll be immediate…

>But OpenAI doesn't have tiny COGS: inference is expensive as fuck.

No, inference is really cheap today, and people saying otherwise simply have no idea what they are talking about. Inference is not expensive.

Re: OpenAI's cash burn will be one of the big bubble questions of 2026

#248

Post by thom »

aprilthird2021 wrote: post #204
phyzix5761 wrote: post #193

Earlier quoted context omitted.

I, personally, use chatGPT for search more than I do Google these days. It, more often than not, gives me more exact results based on what I'm looking for and it produces links I can visit to get more information. I think this is where their competitive advantage lies if they can figure out how to monetize that.

I'm genuinely curious. Why do you do this instead of Google Searches which also have an AI Overview / answer at the top, that's basically exactly the same as putting your search query into a chat bot, but it ALSO has all the links from a regular Google search so you can quickly corroborate the info even using sources not from the original AI result (so you also see discordant sources from what the AI answer had)?

The regular google search AI doesn’t do thinky thinky mode. For most buying decisions these days I ask ChatGPT to go off and search and think for a while given certain constraints, while taking particular note of Reddit and YouTube comments, and come back with some recommendations. I’ve been delighted with the results.

Re: OpenAI's cash burn will be one of the big bubble questions of 2026

#249

Post by johnnyanmac »

dktp wrote: post #176
password54321 wrote: post #49

Not sure why they put so much investment into videoSlop and imageSlop. Anthropic seems to be more focused at least.

OpenAI is (was?) extremely good at making things that go viral. The successful ones for sure boost subscriber count meaningfully Studio Ghibli, Sora app. Go viral, juice numbers then turn the knobs down on copyrighted material. Atlas I believe was a less successful than they would've hoped for. And because of too frequent version bumps that are sometimes released as an answer to Google's launch, rather than a meaning…

Going viral is great when you're a small team or even a million dollar company. That can make or break your business.

Going viral as a billion dollar company spending upward of 1T is still not sustainable. You can't pay off a trillion dollars on "engagement". The entire advertising industry is "only" worth 1T as is: https://www.investors.com/news/advertising-industry-to-hit-1...

Re: OpenAI's cash burn will be one of the big bubble questions of 2026

#250

Post by andrekandre »

raw_anon_1111 wrote: post #231
andrekandre wrote: post #195

Earlier quoted context omitted.

> With Chrome being the largest browser by market share, that's a powerful de facto default. where art thou anti-trust enforcement...

Every personal computer user except Chromebook users went out of their way to download Chrome. What exactly do you want “anti trust” to do?

maybe not allow google to bundle gemini with chrome?
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