4 ms·

Makes me wonder that on any given day someone could find way to improve something, and OpenAI value will evaporate quickly. Seems like these startups with high

Makes me wonder that on any given day someone could find way to improve something, and OpenAI value will evaporate quickly. Seems like these startups with high valuations, are more tenuous even than the startups of years past.

atleastoptimal 3y ago
There's more to startup value that whether or not they've implemented the latest nifty trick into their models. Their moat is architecture, research, distribution, design, and scale. Have all the local LLM hacks based off Llama 2 and the like done anything to diminish OpenAI's value?
- aurareturn 3y ago
  I would say it has. If no one could demonstrate even GPT3.5 capabilities, then OpenAI could be worth a few hundred billion more in private valuations. But multiple vendors have already demonstrated viable alternatives.
  - atleastoptimal 3y ago
    Their valuation tripled to 80 billion in 10 months. I'm pretty sure they're not losing much to open source
    - aurareturn 3y ago
      It gives an idea in investors' minds that OpenAI's models can be matched or be "good enough" by open source models.
      - p1esk 3y ago
        OpenAI has been at least one year ahead of everyone else in everything they have released do far. And there’s no sign they are stopping any time soon (e.g. GPT5 is expected this year).
        imranq 3y ago
        GPT-5 will likely only see improvements in deductive reasoning like in math, I think it there are diminishing returns if all GPT-5 is a larger transformer than GPT-4
        p1esk 3y ago
        That’s probably what GPT-4.5 will be. The bar is much higher for GPT-5.
__loam 3y ago
Also Meta can spend billions building their own models and release it for free to kill your business.
- aussieguy1234 3y ago
  And people will for sure use them to start new startups
BadHumans 3y ago
OpenAI's value doesn't just come from their tech. Copyright Shield is a deal closer from business types I have spoken to. Telling a company, "if anyone we took data from has a problem they have to deal with our lawyers and not you" is music because what companies want most is stability and reliance. It's the entire reason SLAs are such a big deal in B2B.
- Kon-Peki 3y ago
  https://openai.com/policies/business-terms https://openai.com/policies/business-terms Section 10 deals with the indemnification they are offering. There are a lot of limitations. It's definitely not terrible, but it's not remotely close to what a business actually wants in an indemnification agreement. In 10.1 (the indemnification from them to you) does not include "hold harmless", but in 10.2 (the indemnification from you to them) it does. That's not an accident, and those aren't meaningless words ;) If you get sued and notify OpenAI of the suit, their lawyers take over completely. You must do anything they ask (as long as it is "reasonable"), including sitting for depositions, preserving evidence, participating in the discovery process, etc. If you want to have any involvement beyond being told what to do, you have to hire your own lawyers at your own expense. And at the end of it all, they will come to a settlement with the other side. As long as it is "reasonable", you must sign it. https://openai.com/policies/service-terms https://openai.com/policies/service-terms > If there is a conflict between the Service Terms and your Agreement, the Service Terms will control > This indemnity does not apply where: (i) Customer or Customer’s End Users knew or should have known the Output was infringing or likely to infringe, (ii) Customer or Customer’s End Users disabled, ignored, or did not use any relevant citation, filtering or safety features or restrictions provided by OpenAI, (iii) Output was modified, transformed, or used in combination with products or services not provided by or on behalf of OpenAI, (iv) Customer or its End Users did not have the right to use the Input or fine-tuning files to generate the allegedly infringing Output, (v) the claim alleges violation of trademark or related rights based on Customer’s or its End Users’ use of Output in trade or commerce, and (vi) the allegedly infringing Output is from content from a Third Party Offering. If you knew or should have known, you're on your own. If you didn't follow the rules exactly, you're on your own. If you used the output in commerce and they claim a trademark violation, you're on your own. And lastly, remember from the business terms that OpenAI's lawyers take control and you must do whatever they ask in terms of depositions and discovery? In dealing with all that information, if they see any indication that you no longer qualify for indemnification OpenAI is going to say goodbye, send all the legal bills to you. It's better than nothing, for sure. But not all that confidence-inspiring.
CamperBob2 3y ago
Safe to say that FedEx has had to add another flight or two to carry documents from OpenAI to the USPTO.
error9348 3y ago
Could be. Could also be that LLM is to OpenAI what information retrieval is to Google. A lot is publicly known in the information retrieval space, but google still dominates.
- FrustratedMonky 3y ago
  That is good point. The original Google designs are public, those were papers that were published. Anybody could create a new 'google', its just about getting name recognition and users. Guess example is DuckDuckGo, or Bing, they throw money at advertising just to get users, but underlying search isn't the problem.

atleastoptimal 3y ago

There's more to startup value that whether or not they've implemented the latest nifty trick into their models. Their moat is architecture, research, distribution, design, and scale. Have all the local LLM hacks based off Llama 2 and the like done anything to diminish OpenAI's value?

aurareturn 3y ago
I would say it has. If no one could demonstrate even GPT3.5 capabilities, then OpenAI could be worth a few hundred billion more in private valuations. But multiple vendors have already demonstrated viable alternatives.
- atleastoptimal 3y ago
  Their valuation tripled to 80 billion in 10 months. I'm pretty sure they're not losing much to open source
  - aurareturn 3y ago
    It gives an idea in investors' minds that OpenAI's models can be matched or be "good enough" by open source models.
    - p1esk 3y ago
      OpenAI has been at least one year ahead of everyone else in everything they have released do far. And there’s no sign they are stopping any time soon (e.g. GPT5 is expected this year).
      - imranq 3y ago
        GPT-5 will likely only see improvements in deductive reasoning like in math, I think it there are diminishing returns if all GPT-5 is a larger transformer than GPT-4
        p1esk 3y ago
        That’s probably what GPT-4.5 will be. The bar is much higher for GPT-5.

__loam 3y ago

Also Meta can spend billions building their own models and release it for free to kill your business.

aussieguy1234 3y ago
And people will for sure use them to start new startups

BadHumans 3y ago

OpenAI's value doesn't just come from their tech. Copyright Shield is a deal closer from business types I have spoken to. Telling a company, "if anyone we took data from has a problem they have to deal with our lawyers and not you" is music because what companies want most is stability and reliance. It's the entire reason SLAs are such a big deal in B2B.

Kon-Peki 3y ago
https://openai.com/policies/business-terms https://openai.com/policies/business-terms Section 10 deals with the indemnification they are offering. There are a lot of limitations. It's definitely not terrible, but it's not remotely close to what a business actually wants in an indemnification agreement. In 10.1 (the indemnification from them to you) does not include "hold harmless", but in 10.2 (the indemnification from you to them) it does. That's not an accident, and those aren't meaningless words ;) If you get sued and notify OpenAI of the suit, their lawyers take over completely. You must do anything they ask (as long as it is "reasonable"), including sitting for depositions, preserving evidence, participating in the discovery process, etc. If you want to have any involvement beyond being told what to do, you have to hire your own lawyers at your own expense. And at the end of it all, they will come to a settlement with the other side. As long as it is "reasonable", you must sign it. https://openai.com/policies/service-terms https://openai.com/policies/service-terms > If there is a conflict between the Service Terms and your Agreement, the Service Terms will control > This indemnity does not apply where: (i) Customer or Customer’s End Users knew or should have known the Output was infringing or likely to infringe, (ii) Customer or Customer’s End Users disabled, ignored, or did not use any relevant citation, filtering or safety features or restrictions provided by OpenAI, (iii) Output was modified, transformed, or used in combination with products or services not provided by or on behalf of OpenAI, (iv) Customer or its End Users did not have the right to use the Input or fine-tuning files to generate the allegedly infringing Output, (v) the claim alleges violation of trademark or related rights based on Customer’s or its End Users’ use of Output in trade or commerce, and (vi) the allegedly infringing Output is from content from a Third Party Offering. If you knew or should have known, you're on your own. If you didn't follow the rules exactly, you're on your own. If you used the output in commerce and they claim a trademark violation, you're on your own. And lastly, remember from the business terms that OpenAI's lawyers take control and you must do whatever they ask in terms of depositions and discovery? In dealing with all that information, if they see any indication that you no longer qualify for indemnification OpenAI is going to say goodbye, send all the legal bills to you. It's better than nothing, for sure. But not all that confidence-inspiring.

CamperBob2 3y ago

Safe to say that FedEx has had to add another flight or two to carry documents from OpenAI to the USPTO.

error9348 3y ago

Could be. Could also be that LLM is to OpenAI what information retrieval is to Google. A lot is publicly known in the information retrieval space, but google still dominates.

FrustratedMonky 3y ago
That is good point. The original Google designs are public, those were papers that were published. Anybody could create a new 'google', its just about getting name recognition and users. Guess example is DuckDuckGo, or Bing, they throw money at advertising just to get users, but underlying search isn't the problem.