281–290 of 319 posts
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> You think AWS are going to subsidies your usage of somebody else’s models Yes >indefinitely? No, and that's the point.
Have they ever actually done this? I can't think of a time they've actually raised their prices ever that isn't the Route53 passing on registrar costs.
The difference between a web search and text generated by an LLM can be that a web search points to actually existing companies or entities that make statements. Sometimes this is required and summaries or paraphrase are insufficient.
For performance or whatever metric one chooses, it's likely that web search wins some and loses some. It would be interesting to see an in-depth shoot out.
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> If that profit comes from advertising, and critically, if users don't expect advertising in their free LLMs, because they didn't see ads in generated output in the past, that will be very insidious. Are the free LLM providers offering their service with a contractual obligation to the users that they will not add advertising to the outputs? If not, how is it insidious? What definition of insidious are you using per…
Weirdly, no part of that merriam-webster link includes the word "contract". I'm not sure you know how words work.
There has also been restrictions on API usage. In the case of google, they put in place a hard cap on the number of requests you can make in a month, and it isn't that hard to hit it, and you can't buy more usage for any price. And the Bing API is going to be shuttered by the end of the summer. I don't really know the reason for making it hard to use an API, but it does suggest that the price is artificially high to discourage use for whatever reason search engines don't want people to use their API for.
: except maybe if you set up some special deal with google that probably requires you to know someone high up at google.
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Please read the DeepSeek analysis of their API service (linked in this article): they have 500% profit margin and they are cheaper than any of the US companies serving the same model. It is conceivable that the API service of OpenAI or Anthropic have much higher profit margins yet. (GPUs are generally much more cost effective and energy efficient than CPU if the solution maps to both architectures. Anthropic certainl…
With all due respect to Deepseek, I would take their numbers with grain of salt, as they might as well be politically motivated.
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Please read the DeepSeek analysis of their API service (linked in this article): they have 500% profit margin and they are cheaper than any of the US companies serving the same model. It is conceivable that the API service of OpenAI or Anthropic have much higher profit margins yet. (GPUs are generally much more cost effective and energy efficient than CPU if the solution maps to both architectures. Anthropic certainl…
That claim actually gives me pause. It reminds me of an idea from Zero to One by Peter Thiel - that real monopolies like to appear as a small fish in a very big pond, while tiny players try to appear as a monopoly. So when I see a company bragging about "500% profitability," I can’t help but wonder if they’re even profitable at all.
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> You can't compare an API that is profitable (search) to an API that is likely a loss-leader to grab market share (hosted LLM cloud models). Regardless of maturity lifecycle, by definition loss-leaders are cheap. If I go to the grocery store and milk is $1, I don't think I'm being swindled. I know it's a loss-leader and I buy it because it's cheap. We are currently in the early-Netflix-massive-library-for-five-dolla…
Want to bet? I'll give you 5:1 odds that tokens from a model with some specific benchmark performance (we can sort out the specific benchmarks or basket of benchmarks if you want to bet) will be cheaper two years from now.
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Please read the DeepSeek analysis of their API service (linked in this article): they have 500% profit margin and they are cheaper than any of the US companies serving the same model. It is conceivable that the API service of OpenAI or Anthropic have much higher profit margins yet. (GPUs are generally much more cost effective and energy efficient than CPU if the solution maps to both architectures. Anthropic certainl…
Every LLM provider caches their KV-cache, it's a publicly documented technique (go stuff that KV in redis after each request, basically) and a good engineering team could set it up in a month.
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Want to bet? I'll give you 5:1 odds that tokens from a model with some specific benchmark performance (we can sort out the specific benchmarks or basket of benchmarks if you want to bet) will be cheaper two years from now.
Sure. To clarify, I'm not asserting that in two years today's 4o will be 100x more expensive, but the sum of many core offerings from various companies will be. It won't be unheard of for people to spend $2k-$10k/yr between many AI services