How OpenAI uses complex and circular deals to fuel its multibillion-dollar rise

Post by noosphr » Fri, Oct 31, 2025, 5:29 PM UTC

embedding-shape wrote: post #280

noosphr wrote: post #272

Earlier quoted context omitted.

>Otherwise we'd see SOTA models from new groups every month We do. It's just that startups don't go after the frontier models but niche spaces which are under served and can be explored with a few million in hardware. Just like how open AI made gpt2 before they made gpt3.

> We do. > It's just that startups don't go after the frontier models but niche spaces But both of "New SOTA models every month" and "Startups don't go for SOTA" cannot be true at the same time. Either we get new SOTA models from new groups every month (not true today at least) or we don't, maybe because the labs are focusing on non-SOTA instead.

Post by tonyarkles » Fri, Oct 31, 2025, 5:30 PM UTC

embedding-shape wrote: post #260

tonyarkles wrote: post #256

Earlier quoted context omitted.

To simplify it down even more: - For the ML team, you need money. Money to pay them and money to get access to GPUs. You might buy the GPUs and make your own server farm (which also takes time) or you might just burn all that money with AWS and use their GPUs. You can trade off money vs. time. - For the chip design team, you need money and time. There's no workaround for the time aspect of it. You can't spend more mo…

> - For the ML team, you need money. Money to pay them and money to get access to GPUs. You might buy the GPUs and make your own server farm (which also takes time) or you might just burn all that money with AWS and use their GPUs. You can trade off money vs. time. Even if you do those things though, it doesn't guarantee success or you'll be able to train something bigger. For that you need knowledge, hard work and e…

Post by marbro » Fri, Oct 31, 2025, 5:32 PM UTC

skywhopper wrote: post #109

pols45 wrote: post #65

Earlier quoted context omitted.

Yup. Not just Nvidia. Just look at the quarterly results reported by Amazon, Google, Meta, Microsoft and Apple. Each one is reporting revenues never before seen in history. If you make 100 Billion a quarter you have to spend it on something. These guys are running hyper optimized cash extraction mega machines. There is no comparison to previous bubbles, cause so no such companies ever existed in the past.

So many such profitable companies are the best possible evidence for the need for drastic antitrust intervention. The lack of competition and regulation is leading to a massive drain on every other sector.

Post by vineyardmike » Fri, Oct 31, 2025, 5:36 PM UTC

otherjason wrote: post #162

DenisM wrote: post #152

Earlier quoted context omitted.

OpenAI invests heavily into integration with other products. If model development stalls they just need to be not worse than other stalled models while taking advantage of brand recognition and momentum to stay ahead in other areas. In that sense it makes sense to keep spending billions even f model development is nearing diminishing return - it forces competition to do the same and in that game victory belongs to th…

But, if model development stalls, and everyone else is stalled as well, then what happens to turn the current wildly-unprofitable industry into something that "it makes sense to keep spending billions" on?

Post by array_key_first » Fri, Oct 31, 2025, 5:39 PM UTC

chermi wrote: post #138

throwaway106382 wrote: post #26

Isn't paying a company to dig a hole who then pays you the same amount to fill said hole illegal?

Yes, but what does that have to do with this situation? The hole served no purpose. The companies are using the GPUs.