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How will OpenAI compete?

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Re: How will OpenAI compete?

#451

Post by oblio »

Lorkki wrote: post #419
oblio wrote: post #133

Earlier quoted context omitted.

> Being a first mover doesn't guarantee getting to the golden goose, remember MySpace. MySpace, ICQ, Altavista, Dropbox, Yahoo, BlackBerry, Xerox Alto, Altair 8800, CP/M, WordStar, VisiCalc, the list is very long.

IBM owned literally the whole market on computers at a time when computing equipment was prohibitively expensive and centralised.

IBM was a special case, I'm not sure there were many markets so thoroughly cornered like IT was for about 3 decades. I guess telephone (AT&T) was similar.

Re: How will OpenAI compete?

#452

Post by klibertp »

eigenspace wrote: post #230
bandrami wrote: post #208

Earlier quoted context omitted.

They're literally text generators so that's... troubling

They're text generators, but you can think of them as basically operating with a different alphabet than us. When they are given text input, it's not in our alphabet, and when they produce text output it's also not in our alphabet. So when you ask them what letters are in a given word, they're literally just guessing when they respond. Rather, they use tokens that are usually combinations of 2-8 characters. You can p…

For Latin alphabet-based languages, it's pretty similar to how names from those languages are transliterated to Japanese or Korean. You get "Clare" in English and (what, to me, sounds like) "Kurea" in Japanese; equivalent (I'm told!) but not the same. It would be wrong to try to assess the IQ of Japanese (who don't know English) by asking about properties of the original word that are not shared by the Japanese equivalent. On the other hand, English speakers won't ever experience haiku fully, since the script plays a big role in the composition (according to what I'm told... I don't know Japanese, but anime intake exposed me to opinions like this; and even if I'm dead wrong with details, it sounds like a plausible analogy, at least...)

Re: How will OpenAI compete?

#453

Post by wiseowise »

Aldipower wrote: post #394
wiseowise wrote: post #361

Earlier quoted context omitted.

Have you tried actually holding a conversation with it? I'm really puzzled in which world Gemini/Claude is better than ChatGPT for day-to-day tasks/conversations. Claude can't even search products on Amazon, Jesus.

Jesus doesn't care I guess.

That’s because he uses ChatGPT, obviously.

Re: How will OpenAI compete?

#454

Post by DrScientist »

shubhamjain wrote: post #29

Everyone is actually underestimating stickiness. The near billion users OpenAI has is actually a real moat and might translate into decent chunk of revenue. My wife, for example, uses ChatGPT on a daily basis, but has found no reason to try anything else. There are no network effects for sure, but people have hundreds and thousands on conversation on these apps that can't be easily moved elsewhere. Understandable tha…

So in summary OpenAI are basing their valuation of 285 billion on the moat of 'users won't be arsed to download a different app'???

Seems optimistic when there is very little intrinsic stickness due to learning the UI or network effects. Perhaps a little bit chat history - but not 285 billions worth.

Also completely ignoring the fact that most devices things will start to come with the same features directly built into the device/app - and the largest market will be as a commodity backend api that the eventually users won't know or care if it's a google or openai model.

As I see it, they need to be doing stuff nobody else can ( in either price or performance ), otherwise it's hard to justify the valuation.

Re: How will OpenAI compete?

#455

Post by janejanejanejan »

mark_l_watson wrote: post #430

Hopefully this is on-topic: I would hope that some people would opt for private chat services. I evaluated both Proton’s Lumo+ and DuckDuckGo’s Duck.ai services. I like both services but only wanted to pay for one and I chose Lumo+ because chat history is stored with my Proton data and is available in all my devices, Duck.ai stores chat history on current access device. Both services are also very usable with their f…

There are also encrypted AI chatbots like Tinfoil and Confer that E2E encrypt all data to a secure hardware enclave. I also use Claude and OpenAI for non-privacy needing tasks, but use Kimi-k2 on tinfoil when I need privacy. Kimi-k2 feels close enough to SOTA so I'm happy with it.

Re: How will OpenAI compete?

#456

Post by lm28469 »

shubhamjain wrote: post #29

Everyone is actually underestimating stickiness. The near billion users OpenAI has is actually a real moat and might translate into decent chunk of revenue. My wife, for example, uses ChatGPT on a daily basis, but has found no reason to try anything else. There are no network effects for sure, but people have hundreds and thousands on conversation on these apps that can't be easily moved elsewhere. Understandable tha…

> The near billion users OpenAI has

They're losing market share and the growth of active user plateaued. They captured all the normies who learned about llms on TV but these people will never spend a cent as you said.

They're not even on the top 10 most used llms on openrouter anymore: https://openrouter.ai/rankings

At the current pace anthropic will make more money than openai soon: https://epochai.substack.com/p/anthropic-could-surpass-opena...

https://menlovc.com/wp-content/uploads/2025/07/2-llm_api_mar...

Re: How will OpenAI compete?

#457

Post by graemep »

DrScientist wrote: post #454
shubhamjain wrote: post #29

Everyone is actually underestimating stickiness. The near billion users OpenAI has is actually a real moat and might translate into decent chunk of revenue. My wife, for example, uses ChatGPT on a daily basis, but has found no reason to try anything else. There are no network effects for sure, but people have hundreds and thousands on conversation on these apps that can't be easily moved elsewhere. Understandable tha…

So in summary OpenAI are basing their valuation of 285 billion on the moat of 'users won't be arsed to download a different app'??? Seems optimistic when there is very little intrinsic stickness due to learning the UI or network effects. Perhaps a little bit chat history - but not 285 billions worth. Also completely ignoring the fact that most devices things will start to come with the same features directly built in…

It have worked for Google for years, and that was without even the barrier of download in app, just going to a different URL.

Re: How will OpenAI compete?

#458

Post by ianm218 »

lm28469 wrote: post #456
shubhamjain wrote: post #29

Everyone is actually underestimating stickiness. The near billion users OpenAI has is actually a real moat and might translate into decent chunk of revenue. My wife, for example, uses ChatGPT on a daily basis, but has found no reason to try anything else. There are no network effects for sure, but people have hundreds and thousands on conversation on these apps that can't be easily moved elsewhere. Understandable tha…

> The near billion users OpenAI has They're losing market share and the growth of active user plateaued. They captured all the normies who learned about llms on TV but these people will never spend a cent as you said. They're not even on the top 10 most used llms on openrouter anymore: https://openrouter.ai/rankings At the current pace anthropic will make more money than openai soon: https://epochai.substack.com/p/an…

I’m not rooting for open AI but OpenRouter is a very self selecting group. Most API users of Anthropocic or OpenAi would just go through the normal API

Re: How will OpenAI compete?

#459

Post by kergonath »

shubhamjain wrote: post #29

Everyone is actually underestimating stickiness. The near billion users OpenAI has is actually a real moat and might translate into decent chunk of revenue. My wife, for example, uses ChatGPT on a daily basis, but has found no reason to try anything else. There are no network effects for sure, but people have hundreds and thousands on conversation on these apps that can't be easily moved elsewhere. Understandable tha…

> Everyone is actually underestimating stickiness. The near billion users OpenAI has is actually a real moat and might translate into decent chunk of revenue.

I’ve got a small-ish sample of friends who are regular people and use various AI chatbots because mobile phone providers now commonly bundle an AI subscription with their services. People seem to switch between Perplexity, Claude, and ChatGPT without any trouble. It does not look sticky at all to me and the half-a-percent difference in benchmarks we love to obsess about does not translate at all in increased user satisfaction.

Re: How will OpenAI compete?

#460

Post by fosron »

storus wrote: post #435
fosron wrote: post #338

My father uses ChatGPT extensively. My friend, whos an electrician, but has 0 things to do with computers, even called it Chat once and I said who? Because for me its ChatGPT. He also uses it extensively. Although I would bet they won't be willing to pay, advertisements will eventually hit them. And with inference prices going down, with distilled models being used, OpenAI will profit, and people will still hapily us…

Chat.com is ChatGPT so likely that's why he called it Chat.

Oh damn i missed it. Could be that, but were from a non-english country so not sure.
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