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AI Market Clarity

blog.eladgil.com

61–70 of 105 posts

Re: AI Market Clarity

#61
Eh, I'm not sure I buy it on the frontier labs being all locked up. The Chinese stuff is fucking great, and it's improving really really fast. Labs like OpenAI? I'm skeptical they could build their current product lineup from scratch, and why should that be surprising? The people who did it left!

Anthropic has a pretty clear headlock on the absolute apex of brute-force Chinchilla scaling with Opus 4, but they've started being dodgy enough with it that I finally set up Together and OpenRouter and put their shit on Bedrock and Vertex: I'm over it with the "well, it lies about having mocked the whole module today".

And K2? Whew, that's really refreshing. It's different, hard to compare, but I've been running it for a day or so where Sonnet 4 would normally go and I'm not having any trouble. It's clearly the product of a different culture but in a cool way, and on the stuff that counts? Chinese people speak C++ just fine.

I'm pretty sure at this point that infinite NVIDIA is one of the worst handicaps our AI giants could have gotten, and that needing to work within and around export restrictions and gimped cards is the best thing that ever happened to Hangzhou.

I see no reason why the take in the article is any more plausible than an alternative future where the US has about as much market share in frontier LLMs as Europe does in consumer Internet.

Re: AI Market Clarity

#62
The term agent is just way overloaded. This guy defines it completely differently the the big labs, and I’ve seen half a dozen different definitions in the last few months.

In the long run the definition used by OpenAI, Anthropic et al will win out so can we just all switch to that?

Re: AI Market Clarity

#63

Earlier quoted context omitted.

My experience has been pretty great: I regularly chat with the Dott support robot because their shitty app lets you book a ride without camera access, but then the in-app flow doesn't let you end the ride without camera access. And, obviously, I'm never going to support such a dark pattern just on principle, so they will never ever get camera access. That means after every trip, I copy&paste "dear robot, no camera, p…

Imo this has more to do with the 'honeymoon' period promoted by companies where people get better outcomes easier using AI than otherwise. Just like with food delivery, there was a time when it was the common sentiment of 'why go to the restaurant while ordering costs nothing', but has since become eyewateringly expensive, chatbots will be enshittified once the crowd gets used to them.

This is a bad analogy. Food delivery didn't get more expensive due to some broadly applicable abstract political force of "enshittification," it had particular dynamics which applied to it:

1. Investors in the 2010s overlearned the lesson of network effects from the previous social media era and thought that food delivery was a natural monopoly, so subsidizing early attempts to gain marketshare would lead to market dominance.

2. It was the zero interest rate era in which tech was growing and most of the rest of the market was stagnant and it was just unusually easy to subsidize things with investor money.

3. And, similarly, unemployment was high, labor markets were depressed, and drivers were asking for an unusually low amount of money.

4. Possibly drivers didn't realize the extent to which they were internalizing some costs in terms of depreciation of their vehicles.

5. Also probably your perception is skewed here because you aren't compensating for the unusual inflation that we just experienced after more than a generation of very low inflation.

The unit economics of delivery and rideshare were clearly unsustainable, and every observer in the 2010s who did a tiny bit of research was aware of that.

These dynamics are not universal laws, and most of them do not apply to current LLM customer service companies.

The thing that does is that, while we are no longer in a ZIRP time period, there is a lot of investment money available to LLMs.

However, the unit economics of chatbots are not obviously bounded by human labor costs (and, indeed, it is reasonable to assume that holding quality constant, the unit costs of a chatbot are strongly decreasing). We aren't coming out of a low-inflation period into a high-inflation spike (and, possibly, are going to do the reverse). There is no real equivalent to the idea of the driver-centered phenomena of a depressed labor market or illegible cost absorption into the equity of vehicles. I don't think anyone makes the case that specifically chat CS bots are a natural monopoly (though they may for fundamental models).

There are certainly reasons why one may be pessimistic of the viability of customer service chatbots, but I encourage people to think past vapid slogans like "enshittification."

Re: AI Market Clarity

#64
No mention of product prototyping products e.g. vercel v0 or Firebase Studio. Those to me seem like clear 0->1 wins, especially vercel with their hosting/marketplace integrating well with AI-driven development.

Re: AI Market Clarity

#65
post #51

Earlier quoted context omitted.

Nah. "Capitalism" is simply losing its original meaning amid more lower quality comments. If you look closely, the earlier comment is really about the apparent failing of intellectual property laws (which are antithetical to capitalism!), not capitalism. In the olden days HN users would have taken care to make it clear that they were talking about IP laws, but now "capitalism" has come to be used as some kind of catc…

I’m looking closely and I’m not seeing IP laws being relevant. Maybe regarding windows 11 keys? Can you elaborate? I think the claim isn’t totally inaccurate. Claiming that companies prioritize making products last just beyond return windows because that maximizes profits is a critique of capitalism IMO. Since capitalism is about profit (capital) being the dominant signal as far as I understand it. In my opinion, a l…

> Since capitalism is about profit (capital)

Capitalism is about private ownership of the means of production.

There is nothing about the private ownership of the means of production that inherently leads to the situation described earlier. You could end up in the exact same place if the means of production was community owned.

What leads us there is intellectual property laws, which create artificial monopolies. Go on, just try and copy that shitty product that only lasts 35 days, but modify it slightly to last longer to the glee of the customers, and see how long you last before lawyers are breathing down your neck...

Re: AI Market Clarity

#66
post #4

Earlier quoted context omitted.

The churn is brutal. Once people have gotten over the novelty of an AI companion they quickly grow disatisified with the limitations and leave. It’s a lot like a game that people play with for a bit then leave when they’ve done everything they can do.

That's not what the numbers coming from some of these companies say — for example, chai app, publicly shares that their W52 retention is 20%. So, 20% of users who send a message just retain forever. Source: https://www.chai-research.com/chai_roadmap_2025.pdf

The numbers are saying exactly what I said.

Re: AI Market Clarity

#67
post #65

Earlier quoted context omitted.

I’m looking closely and I’m not seeing IP laws being relevant. Maybe regarding windows 11 keys? Can you elaborate? I think the claim isn’t totally inaccurate. Claiming that companies prioritize making products last just beyond return windows because that maximizes profits is a critique of capitalism IMO. Since capitalism is about profit (capital) being the dominant signal as far as I understand it. In my opinion, a l…

> Since capitalism is about profit (capital) Capitalism is about private ownership of the means of production. There is nothing about the private ownership of the means of production that inherently leads to the situation described earlier. You could end up in the exact same place if the means of production was community owned. What leads us there is intellectual property laws, which create artificial monopolies. Go…

> Capitalism is about private ownership of the means of production

That's part of the definition but not the whole definition.

Other parts of of the definition include:

Capitalism is about free markets.

Capitalism is about competition.

Capitalism is about converting the commons to private ownership.

Capitalism is about the more wealthy and powerful exploiting those with less wealth and power.

Capitalism is about mystifying how the system works so it's hard for people to imagine that it could work any other way.

Re: AI Market Clarity

#68
post #67
post #65

Earlier quoted context omitted.

> Since capitalism is about profit (capital) Capitalism is about private ownership of the means of production. There is nothing about the private ownership of the means of production that inherently leads to the situation described earlier. You could end up in the exact same place if the means of production was community owned. What leads us there is intellectual property laws, which create artificial monopolies. Go…

> Capitalism is about private ownership of the means of production That's part of the definition but not the whole definition. Other parts of of the definition include: Capitalism is about free markets. Capitalism is about competition. Capitalism is about converting the commons to private ownership. Capitalism is about the more wealthy and powerful exploiting those with less wealth and power. Capitalism is about myst…

> Capitalism is about free markets. [...] Capitalism is about competition.

Okay, sure. But IP laws prevent all that. As before, IP laws are antithetical to capitalism — and the source of breakdown witnessed earlier.

Re: AI Market Clarity

#69

Earlier quoted context omitted.

This comment is a dire indictment of the state of capitalism from start to end.

Is it just me or has the tide of opinion on HN really shifted against capitalism in the past year?

My take is "capitalism" is often used as a stand-in for "wealth inequality", which seems reasonable. This is arguably the inevitable outcome of (late-stage?) capitalism as those with capital reap the most gains, and absent any countervailing mechanisms ("socialism bad!!!") leverage that wealth to ensure the cycle continues.
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