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OpenAI's cash burn will be one of the big bubble questions of 2026

economist.com

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Re: OpenAI's cash burn will be one of the big bubble questions of 2026

#751

Post by Bombthecat »

oblio wrote: post #504
Bombthecat wrote: post #482

Earlier quoted context omitted.

Eh, I wouldn't be so sure, chips with brain matter and or light are on its way and or quantum chips, one of those or even a combination will give AI a gigantic boost in performance. Finally replacing a lot more humans and whoever implements it first will rule the world.

> chips with brain matter and or light The... what now?

https://www.technologyreview.com/2023/12/11/1084926/human-br...

They are getting better, faster etc etc.

And I get down voted again for the truth people don't want to hear lol

Re: OpenAI's cash burn will be one of the big bubble questions of 2026

#752

Post by Alconicon »

bigyabai wrote: post #129
Alconicon wrote: post #87

Earlier quoted context omitted.

Apparently we all have enough money to put it into OpenAI. Some players have to play, like google, some players want to play like USA vs. China. Besides that, chatting with an LLM is very very convincing. Normal non technical people can see what 'this thing' can already do and as long as the progress is continuing as fast as it currently is, its still a very easy to sell future.

> Some players have to play, like google I don't think you have the faintest clue of what you're talking about right now. Google authored the transformer architecture, the basis of every GPT model OpenAI has shipped. They aren't obligated to play any more than OpenAI is, they do it because they get results. The same cannot be said of OpenAI.

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Re: OpenAI's cash burn will be one of the big bubble questions of 2026

#753

Post by b3nji »

avalys wrote: post #139

AI is going to be a highly-competitive, extremely capital-intensive commodity market that ends up in a race to the bottom competing on cost and efficiency of delivering models that have all reached the same asymptotic performance in the sense of intelligence, reasoning, etc. The simple evidence for this is that everyone who has invested the same resources in AI has produced roughly the same result. OpenAI, Anthropic,…

I thought the same.

Have you thought that there was a massive physical infrastructure left behind by the original railroad builders, all compatible with future vehicles? Other companies were able to buy the railroads for low prices and use.

Large Language Models change their power consumption requirements monthly, the hardware required to run them is replaced at a rapid rate too. If it were to stop tomorrow, what would you be left with? Out of date hardware, massively wasted power, and a gigantic hole in your wallet.

You could argue you have the blueprints for LLM building, known solutions, and it could all be rebuilt. The thing is, would you want to rebuild, and invest so much again for arguably little actual, tangible output? There isn't anything you can reuse, like others that came after could reuse the railroads.

Re: OpenAI's cash burn will be one of the big bubble questions of 2026

#754

Post by Alconicon »

nutjob2 wrote: post #234
Alconicon wrote: post #85

Earlier quoted context omitted.

Because OpenAI stands for AI leader. If Gemini can create or edit an image, chatgpt needs to be able to do this too. Who wants to copy&paste prompts between ai agents? Also if you want to have more semantics, you add image, video and audio to your model. It gets smarter because of it. OpenAI is also relevant bigger than antropic and is known as a generic 'helper'. Antropic probably saw the benefits of being more focu…

> Because OpenAI stands for AI leader. It'll just end up spreading itself too thin and be second or third best at everything. The 500lb gorilla in the room is Google. They have endless money and maybe even more importantly they have endless hardware. OpenAI are going to have an increasingly hard time competing with them. That Gemini 3 is crushing it right now isn't the problem. It's Gemini 4 or 5 that will likely lea…

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Re: OpenAI's cash burn will be one of the big bubble questions of 2026

#755

Post by lotsofpulp »

pvtmert wrote: post #709
lotsofpulp wrote: post #466

Earlier quoted context omitted.

> Amazon already has not been paying any sort of income tax to the EU. That should be expected, because https://european-union.europa.eu/priorities-and-actions/acti... > The EU does not have a direct role in collecting taxes or setting tax rates. > There was a lawsuit in Belgium but Amazon has won that in late-2024 since they had a separate agreement in/with Luxembourg. Dec 2023. > Speaking for EU, all big tech alrea…

I find it funny because; 1. Amazon reports 250bn$+ revenue for entire EU in 2025. (of course, revenue != profit) while all 250bn$+ evaporates to somewhere. Their own page [1] reports 225k employees across EU, meaning that each employee returns whopping 1 million plus dollars! While being compensated less than 10% of their value! 2. In their own article [1], they boast how they invested (translated; smuggled money out…

>1. Amazon reports 250bn$+ revenue for entire EU in 2025. (of course, revenue != profit) while all 250bn$+ evaporates to somewhere. Their own page [1] reports 225k employees across EU, meaning that each employee returns whopping 1 million plus dollars! While being compensated less than 10% of their value!

An employee's "value" is not revenue / number of employees. There are many businesses where employees are reduced, but revenue does not decrease in direct proportion.

An employee's compensation is only related to what the employer thinks they can pay someone else and what the employee thinks another employer will pay them. Just like how the price of an apple is related to what the grocery store thinks a customer will pay for it and what the customer thinks a different grocery store will sell it for. (Obviously bounded on both sides by the minimum cost to produce and transport the apple, and by the maximum price a customer is able and willing to pay).

Re: OpenAI's cash burn will be one of the big bubble questions of 2026

#756

Post by Izkata »

raw_anon_1111 wrote: post #209
phyzix5761 wrote: post #193

Earlier quoted context omitted.

I, personally, use chatGPT for search more than I do Google these days. It, more often than not, gives me more exact results based on what I'm looking for and it produces links I can visit to get more information. I think this is where their competitive advantage lies if they can figure out how to monetize that.

We don’t need anecdotes. We have data. Google has been announcing quarter after quarter of record revenues and profits and hasn’t seen any decrease in search traffic. Apple also hinted at the fact that it also didn’t see any decreased revenues from the Google Search deal. AI answers is good enough and there is a long history of companies who couldn’t monetize traffic via ads. The canonical example is Yahoo. Yahoo was…

Given the audience here vs the general population, I can't help but wonder if it's just the alternate search engines like DuckDuckGo/Kagi/Bing that are losing search traffic. From the population sizes even the alternate ones that are Google-based might just not be enough to be visible in Google's numbers.

Re: OpenAI's cash burn will be one of the big bubble questions of 2026

#757

Post by Izkata »

golem14 wrote: post #412
dheera wrote: post #348

Earlier quoted context omitted.

I was around pre-Google. Ranking was Google's 5% contribution to it. They stood on the shoulders of people who invented physical server and datacenter infrastructure, Unix/Linux, file systems, databases, error correction, distributed computing, the entire internet infrastructure, modern Ethernet, all kinds of stuff.

Eh ... I question that 5% ranking is google's only contribution, even if it was important. Everyone stood on the shoulders of file systems and databases, ethernet (and firewalls and netscreens, ...) Well, maybe a few stood on the shoulder of PHP. Google did in fact pretty much figure out how to scale large number of servers (their racking, datacenters, clustering, global file systems etc) before most others did. I be…

More specifically on that last point, I remember reading something like Google's biggest contribution hardware-wise was using lots of cheap, easliy-replaced distributed storage with redundancy instead of expensive large singular storage with error-correction? Or maybe it was memory and not storage. Whatever it was I remember them not caring as much about error correction as others, and being able to use relatively cheap hardware because of it.

Re: OpenAI's cash burn will be one of the big bubble questions of 2026

#758

Post by mettamage »

avalys wrote: post #139

AI is going to be a highly-competitive, extremely capital-intensive commodity market that ends up in a race to the bottom competing on cost and efficiency of delivering models that have all reached the same asymptotic performance in the sense of intelligence, reasoning, etc. The simple evidence for this is that everyone who has invested the same resources in AI has produced roughly the same result. OpenAI, Anthropic,…

> The simple evidence for this is that everyone who has invested the same resources in AI has produced roughly the same result. OpenAI, Anthropic, Google, Meta, Deepseek, etc. There's no evidence of a technological moat or a competitive advantage in any of these companies.

Practically, what I'm finding is that whenever I ask Claude to search stuff on Reddit, it can't but Gemini can. So I think the practical advantages are where certain organizations have unfair data advantages. What I found out is that LLMs work a lot better when they have quality data.

Re: OpenAI's cash burn will be one of the big bubble questions of 2026

#760

Post by yellowcake0 »

atombender wrote: post #749
yellowcake0 wrote: post #737

Earlier quoted context omitted.

LibreOffice didn't replace MS Office, and Octave didn't replace Matlab. It seems to me that there is even less of a moat with these products than there is with Claude Code, yet neither was commoditized.

Google Workspace replaced Microsoft Office. It has around 70% market share. Microsoft Office is still dominant in much of the traditional enterprise, but the moat is shrinking. I can use Claude in Jetbrains IntelliJ and in Zed, I can use it with OpenCode, and there are lots of other agent tools. Everyone can build these tools around an LLM, and they're already being commodified. The moat right now is the quality of t…

Enterprise is what determines commoditization as that's where the lion's share of the revenue comes from. Maybe it will eventually happen to MS Office, maybe it won't, but until it happens it hasn't happened. Access to the full MS ecosystem, technical support and seamless integration, these things matter a lot to businesses, and I'm not even saying you're wrong, but I'm not convinced yet that something similar won't play out with coding agents.
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