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Microsoft and OpenAI end their exclusive and revenue-sharing deal

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Re: Microsoft and OpenAI end their exclusive and revenue-sharing deal

#551

Post by gpt5 »

bastawhiz wrote: post #366
thanhhaimai wrote: post #241

Opinions are my own. I think the biggest winner of this might be Google. Virtually all the frontier AI labs use TPU. The only one that doesn't use TPU is OpenAI due to the exclusive deal with Microsoft. Given the newly launched Gen 8 TPU this month, it's likely OpenAI will contemplate using TPU too.

Many labs use TPUs, but not exclusively. Most labs need more compute than they can get, and if there's TPU capacity, they'll adapt their systems to be able to run partially on TPUs.

Why is AMD not more popular then if labs are so flexibly with giving away CUDA?

Re: Microsoft and OpenAI end their exclusive and revenue-sharing deal

#552

Post by rishabhaiover »

thanhhaimai wrote: post #241

Opinions are my own. I think the biggest winner of this might be Google. Virtually all the frontier AI labs use TPU. The only one that doesn't use TPU is OpenAI due to the exclusive deal with Microsoft. Given the newly launched Gen 8 TPU this month, it's likely OpenAI will contemplate using TPU too.

The only reason anyone uses a TPU is because they couldn't get the best GPUs.

Re: Microsoft and OpenAI end their exclusive and revenue-sharing deal

#553

Post by lazide »

TheFirstNubian wrote: post #545
manmal wrote: post #504

Earlier quoted context omitted.

I don’t think LLMs are that great at creating, however improved they have; I need to stay in the driver seat and really understand what’s happening. There’s not that much leverage in eliminating typing. However, for reviewing, I want the most intelligent model I can get. I want it to really think the shit out of my changes. I’ve just spent two weeks debugging what turned out to be a bad SQLite query plan (missing a r…

I’m a little conflicted on this, as I see a slippery slope here. LLMs in their current state (e.g., Opus-4.7) are really good in planning and one-shot codegen, which I believe is their primary use case. So they do provide enough leverage in that regard. With this new workflow, however, we should, uncompromisingly, steer the entire code review process. The danger here, the “slippery slope,” is that we’re constantly cr…

Subconsciously?!?

Re: Microsoft and OpenAI end their exclusive and revenue-sharing deal

#554

Post by dijit »

senordevnyc wrote: post #539
dijit wrote: post #458

Earlier quoted context omitted.

> It’s not more hype than product, it has found a market (making many billions in revenue) Speculation based on selling at below cost. > it’s not valued at trillions Fair, it's only $852 billion. Nowhere near trillions.. you got me.

Inference is quite profitable, so wrong again.

Right. Going to take "inference is quite profitable" apart, because there's nothing else in your reply.

OpenAI's adjusted gross margin: 40% in 2024, 33% in 2025. Reason cited: inference costs quadrupled in one year.

https://sacra.com/c/openai/

Internal projections leaked to The Information: ~$14B loss on ~$13B revenue in 2026. Cumulative losses through 2028: ~$44B.

https://finance.yahoo.com/news/openais-own-forecast-predicts...

A business burning more than a dollar for every dollar of revenue is a lot of things. "Quite profitable" is not one of them.

If you're reaching for the SaaStr piece on API compute margins hitting ~70% by late 2025: yes, that exists, and it describes one tier. The volume is on the consumer side. The consumer side is the bit on fire. Pointing at the API margin and calling the whole business profitable is the financial equivalent of weighing yourself with one foot off the scale.

The original argument, in case it got lost: Microsoft holds (held) a 49% stake in a company projecting another $44B of cumulative losses through 2028, against unit economics that depend on competitors not catching up. That's textbook hedge-the-bet territory. "They have paying customers" doesn't refute that, MoviePass had paying customers too.

Re: Microsoft and OpenAI end their exclusive and revenue-sharing deal

#555

Post by jiggawatts »

gchamonlive wrote: post #164
lokar wrote: post #74

Earlier quoted context omitted.

Does anyone expect azure quality to improve? Has it improved at all in the last 3 years? Does leadership at MS think it needs to improve? I doubt it

No and at this point tying yourself to azure is a strategic passive and anyone making such decisions should be held responsible for any service outage or degradation.

This is certainly... an opinion.

AWS's us-east-1 famously takes down either a bunch of companies with it, or causes global outages on the regular.

AWS has a terrible, terrible user interface partly because it is partitioned by service and region on purpose to decrease the "blast radius" of a failure, which is a design decision made totally pointless by having a bunch of their most critical services in one region, which also happens to be their most flaky.

Re: Microsoft and OpenAI end their exclusive and revenue-sharing deal

#557

Post by rishabhaiover »

wg0 wrote: post #413

A wise man from Google said in an internal memo to the tune of: "We do not have any moat neither does anyone else." Deepseek v4 is good enough, really really good given the price it is offered at. PS: Just to be clear - even the most expensive AI models are unreliable, would make stupid mistakes and their code output MUST be reviewed carefully so Deepseek v4 is not any different either, it too is just a random token…

> just a random token generator based on token frequency distributions with no real thought process

I'm not smart enough to reduce LLMs and the entire ai effort into such simple terms but I am smart enough to see the emergence of a new kind of intelligence even when it threatens the very foundations of the industry that I work for.

Re: Microsoft and OpenAI end their exclusive and revenue-sharing deal

#558

Post by refulgentis »

wg0 wrote: post #413

A wise man from Google said in an internal memo to the tune of: "We do not have any moat neither does anyone else." Deepseek v4 is good enough, really really good given the price it is offered at. PS: Just to be clear - even the most expensive AI models are unreliable, would make stupid mistakes and their code output MUST be reviewed carefully so Deepseek v4 is not any different either, it too is just a random token…

"Deepseek v4 is good enough, really really good given the price it is offered at."

Kimi, MiMo, and GLM 5.1 all score higher and are cheaper.

They all came out before DeepSeek v4. I think you're pattern-matching on last year's discourse.

(I haven't seen other replies, yet, but I assume they explain the PS that amounts to "quality doesn't matter anyway": which still doesn't address the fact it's more expensive and worse.)

Re: Microsoft and OpenAI end their exclusive and revenue-sharing deal

#559

Post by toyg »

AntiUSAbah wrote: post #444
sumeno wrote: post #222

Earlier quoted context omitted.

History started well before 4 years ago

Yeah but this AI wave has nothing to do how we came to AI winter in the 70s or 80s. The necessary amount of Compute, interconnect (internet), money, researcher etc. wasn't available at that time. and we did not invest the most amount of money and compute and brain power as we are doing right now. This is unseen.

Ah, the youth...

"The new economy" also didn't have anything to do with the previous one. Turns out that it crashed just as well.

Re: Microsoft and OpenAI end their exclusive and revenue-sharing deal

#560

Post by mattnewton »

gpt5 wrote: post #551
bastawhiz wrote: post #366

Earlier quoted context omitted.

Many labs use TPUs, but not exclusively. Most labs need more compute than they can get, and if there's TPU capacity, they'll adapt their systems to be able to run partially on TPUs.

Why is AMD not more popular then if labs are so flexibly with giving away CUDA?

people are trying, especially for inference. For training, it’s just too high risk to tank your training I think.

TPUs are at least dogfooded by Google deepmind, no team AFAIK has gotten the AMD stack to train well.

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