401–410 of 425 posts
Suspicious lack of pro-AI comments here
It's the thing to do in HN comments. Downvote anything AI related and armchair diagnosing AI coding as psychosis. :/ Luckily, we've seen this before. Doom and gloom when smartphones came out. And then the same again when mobile development was preferred and there was an outcry from the web dev crowd and constant downvoting of phone apps.
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This is the venture model now though. Spend until profitable. Uber did it. It seems OpenAI could do it as well given we seem to be in a 2 horse race for foundation models and having capital to get better pushes them further ahead. Gemini is number 3 in this race
Uber’s situation was different, though. The reason Uber were bleeding money is because they purposefully made all their rides cheap to undercut the taxi businesses. People used Uber because it was cheaper than renting a taxi. Now you can’t really find taxis anywhere, even at airports it’s a lot more difficult than it used to be. Once the taxi business was disrupted enough, Uber’s pricing skyrocketed and customers had…
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Buyers of consumer storage, RAM, and GPUs care. People affected by the data center buildouts care. Workers losing jobs due to underpriced tokens care. People on the receiving end of AI slop care.
People aren't affected by PC component prices. The MacBook Neo was introduced and selling extraordinarily well for $500 during this component price crisis. 99% of the population isn't building their own PCs or smartphones.
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6bn seems excessive but despite GPT 5.5 arguably being better than Claude I don't see a lot of adoption of Codex yet. Some of my coworkers even use Sonnet (the default in Claude Code for the 20 USD subscription) and see no reason to change even though that model is definitely "outdated" compared to current SOTA.
most people are behind the curve
”The company reports over 900 million weekly active users of ChatGPT, though only about 50 million of those are paid subscribers.” With so many free models available the ai companies are going to struggle to convert active free users to paid.
Crazy that they have 50 _million_ paying subscribers and are still losing money.
They don’t care about making money at present
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Looking at the fact that third parties are making a profit offering XYZ third party open models on OpenRouter, it stands to reason that OpenAI could turn off their R&D, marketing, hype jedi, legal departments and just sell GPT9.999 and turn a profit. Again like in the Amazon analogy, I don't think they're done growing, and unfortunately, I think they've positioned themselves (perhaps intentionally) as too big to fail…
it stands to reason that OpenAI could turn off their R&D, marketing, hype jedi, legal departments and just sell GPT9.999 and turn a profit. That rests on 2 assumptions: 1) That inference on OpenAI's frontier models is actually cost competitive with open models. Their high SG&A suggests otherwise. 2) That slashing R&D won't lead to a marketshare collapse when everyone (remaining) moves to Anthropic to get on their fro…
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Why would the company pay more when they can just not pay more? The only things I can see happening is they might lower prices as competition ramps up, or in general as there is more supply for the same cost.
If there's sufficient demand, that's just what happens. To try and explain one path: Company A doesn't raise wages but makes 5% more money. Company B pivots from Industry B into construction (because suddenly construction is having 5% fatter margins), and hires workers at more competitive wages to poach them from Company A. Company A forces to raise wages. If there's a demand ceiling on housing it's a different story…
Everyone's financial literacy seems to evaporate when discussing AI companies. They assume that companies need to be profitable or they're a bubble waiting to burst. The whole point of the company is that they are investing a huge amount of money upfront in order to make models that are better and better, and thus have a higher productivity multiplier. They are very profitable on inference, they just know that the ra…
I think that the issue most people have is that the degree to which they would need to be profitable in order to pay back their debt is not realistic. It is unlikely that they would be able to get that large a portion of US GDP and if they did then there will likely be riots in the streets.
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Wait. ARR has no precise definition but has a clear social understanding. It’s clear Ed doesn’t get that and ARR not having a clear definition doesn’t absolve him of the mistake. His misunderstanding was on a different axis. The miscalculations are pretty clearly pointed out in the tweet I linked earlier.
> Wait. ARR has no precise definition but has a clear social understanding. This is (historically) a recipe for fraud and badness. If ARR is important enough to be reported, then there should be a GAAP definition. Do you use calendar month or four week rolling? Do you account for seasonality? How do you recognise revenue? (My sense is that Anthropic do sketchy things with credits, as the consumer ones last for like 1…
> I’m a reporter who has written about technology, economics, and public policy for more than a decade. Before I launched Understanding AI, I wrote for the Washington Post, Vox.com, and Ars Technica. I have a master’s degree in computer science from Princeton.
> I’m working on Understanding AI full-time, and I have no outside investors or donors. Since I started it in 2023, paying subscribers have accounted for a large majority of my income (you can see full details on my source of income on my disclosure page). Their support allows me to work on the newsletter full-time.
Passes my credibility check because I've read a lot of his work, and he's been around the block a few times in journalism circles.
I'm really curious about something: how far will you go to support AI? Clearly they'll need to monetize things further, would you still use [whatever AI you are paying for] if the price was doubled? Tripled? Where would you stop and would you stop using AI altogether or would you look at competitors?
It depends on how much time it saves me and how much I make per hour generally, right? If AI allows me to cut my time to do something in half on average or allows me to do 2x more it would be worth it to pay up to what my monthly income was before assuming my income scaled with my output.
The problem is that hasn’t been the case for 50 years