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OpenAI’s board, paraphrased: ‘All we need is unimaginable sums of money’

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Re: OpenAI’s board, paraphrased: ‘All we need is unimaginable sums of money’

#71

Post by btilly »

toddmorey wrote: post #40
cs702 wrote: post #21

This rings true to my ears: > There is no technical moat in this field, and so OpenAI is the epicenter of an investment bubble. Thus, effectively, OpenAI is to this decade’s generative-AI revolution what Netscape was to the 1990s’ internet revolution. The revolution is real, but it’s ultimately going to be a commodity technology layer, not the foundation of a defensible proprietary moat. In 1995 investors mistakenly…

Genuinely curious if anyone has ideas how an LLM provider could moat AI. They feel interchangeable like bandwidth providers and seem like it will be a never ending game of leapfrog. I thought perhaps we’d end up with a small set of few top players just based on the scale of investment but now I’ve also seen impressive gains from much smaller companies & models, too.

Three ideas. All tried, none worked yet.

First, get government regulation on your side. OpenAI has already looked for this, including Sam Altman testifying to Congress about the dangers of AI, but didn't get the regulations that they wanted.

Second, put the cost of competing out of reach. Build a large enough and good enough model that nobody else can afford to build a competitor. Unfortunately a few big competitors keep on spending similar sums. And much cheaper sums are good enough for many purposes.

Third, get a new idea that isn't public. For instance one on how to better handle complex goal directed behavior. OpenAI has been trying, but have failed to come up with the right bright idea.

Re: OpenAI’s board, paraphrased: ‘All we need is unimaginable sums of money’

#72

Post by nemomarx »

ninth_ant wrote: post #41
neals wrote: post #34

Earlier quoted context omitted.

I get the moat idea. But are there really any moats? What's a good moat these days anyway? Isn't being first and "really good" fine as well?

The Network effect, and cultural mind share are two pretty effective moats. Meta and X proven surprisingly resilient in the face of pretty overwhelming negative sentiment. Google maintains monopoly status on Web Search and in Browsers despite not being remarkably better than competition. Microsoft remains overwhelmingly dominant in the OS market despite having a deeply flawed product. Amazon sells well despite a prol…

To be fair despite Valve's tech stack being easy to replicate, their actual competition mostly hasn't replicated their feature set in full? Epic took a while to ramp up to "shopping carts" despite having a pretty large funding model, still doesn't have little gimmicks like trading cards and chat stickers, w/e. That's not really moat but it seems like the competition doesn't want to invest to exact parity.

(And a lot of stores like Ubisofts or EA's were very feature lite tbh.)

Re: OpenAI’s board, paraphrased: ‘All we need is unimaginable sums of money’

#74

Post by KennyBlanken »

janice1999 wrote: post #7

Where is all the money going? Nvidia hardware?

That and power. The GB200 needs 1000W per GPU.

Eight racks of GB200's? You're talking about 1 megawatt of power. Well over that if you include PSU losses, cooling, and all the networking, storage, memory...

Re: OpenAI’s board, paraphrased: ‘All we need is unimaginable sums of money’

#75

Post by ryanwaggoner »

numpy-thagoras wrote: post #14

OpenAI's engineers: brilliant, A+, A* even. OpenAI's C-suite: Well, they earned the C, but it was a letter grade. What a profoundly unimaginative strategy. No matter the industry, a large-scale diversion of resources towards a moonshot goal will likely get you to that goal. They haven't made an argument as to why we should do that just for them, especially with all of the other alternatives. And no, advertising your…

”They haven’t made an argument as to why we should do that just for them…”

What “we”? They’ve already raised billions, and I suspect they’re about to succeed at raising tens of billions more, despite the skepticism of random HN users.

Re: OpenAI’s board, paraphrased: ‘All we need is unimaginable sums of money’

#76

Post by cs702 »

phodo wrote: post #57
toddmorey wrote: post #40

Earlier quoted context omitted.

Genuinely curious if anyone has ideas how an LLM provider could moat AI. They feel interchangeable like bandwidth providers and seem like it will be a never ending game of leapfrog. I thought perhaps we’d end up with a small set of few top players just based on the scale of investment but now I’ve also seen impressive gains from much smaller companies & models, too.

One view is that it’s not first mover, but first arriver advantage. Whoever gets to AgI (the fabled city of gold or silver?, Ag pun intended) will achieve exponential gains from that point forward, and that serves as the moat in the limit. So you can think of it as buying a delayed moat, with an option price equivalent to the investment required until you get to that point in time. Either you believe in that view or…

Yes, "first to arrive at AGI" could indeed become a moat, if OpenAI can get there before the clock runs out. In fact, that's what's driving all the spending.

Re: OpenAI’s board, paraphrased: ‘All we need is unimaginable sums of money’

#78

Post by minimaxir »

toddmorey wrote: post #40
cs702 wrote: post #21

This rings true to my ears: > There is no technical moat in this field, and so OpenAI is the epicenter of an investment bubble. Thus, effectively, OpenAI is to this decade’s generative-AI revolution what Netscape was to the 1990s’ internet revolution. The revolution is real, but it’s ultimately going to be a commodity technology layer, not the foundation of a defensible proprietary moat. In 1995 investors mistakenly…

Genuinely curious if anyone has ideas how an LLM provider could moat AI. They feel interchangeable like bandwidth providers and seem like it will be a never ending game of leapfrog. I thought perhaps we’d end up with a small set of few top players just based on the scale of investment but now I’ve also seen impressive gains from much smaller companies & models, too.

One way to build a technical moat is to build services which encourage lock-in, and therefore make it hard to switch to a competitor. Some of OpenAI's product releases help facilitate that: the Assistant API creates persistent threads that cannot be exported, and their File Search APIs build vector stores that cannot be exported.

Re: OpenAI’s board, paraphrased: ‘All we need is unimaginable sums of money’

#79

Post by usrusr »

nick3443 wrote: post #61
phodo wrote: post #57

Earlier quoted context omitted.

One view is that it’s not first mover, but first arriver advantage. Whoever gets to AgI (the fabled city of gold or silver?, Ag pun intended) will achieve exponential gains from that point forward, and that serves as the moat in the limit. So you can think of it as buying a delayed moat, with an option price equivalent to the investment required until you get to that point in time. Either you believe in that view or…

What if the AGI takes an entire data center to process a few tokens per second. Is the still a first-arriver advantage? Seems like the first to make it cheaper than an equivalent-cost employee (fully loaded incl hiring and training) will begin to see advantage.

What if the next one to get there produces a similar service for 5% less? Race to the bottom.

And would AI that is tied to some interface that provides lock-in even be qualified to be called general? I have trouble pointing my finger on it, but AGI and lock-in causes a strong dissonance in my brain. Would AGI perhaps strictly imply commodity? (assuming that more than one supplier exists)

Re: OpenAI’s board, paraphrased: ‘All we need is unimaginable sums of money’

#80

Post by throwup238 »

dartos wrote: post #64
phodo wrote: post #57

Earlier quoted context omitted.

One view is that it’s not first mover, but first arriver advantage. Whoever gets to AgI (the fabled city of gold or silver?, Ag pun intended) will achieve exponential gains from that point forward, and that serves as the moat in the limit. So you can think of it as buying a delayed moat, with an option price equivalent to the investment required until you get to that point in time. Either you believe in that view or…

None of that would matter if they could find the holy grail though.

Every time a new model comes out I ask it to locate El Dorado or Shangri-La for me. That’s my criteria for AGI/ASI.

Alas I am still without my mythical city of gold.

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