5 ms·

The big winners of this: devs and AI startups - No more vendor lock-in - Instead of just wrapping proprietary API endpoints, developers can now integrate AI d

The big winners of this: devs and AI startups - No more vendor lock-in - Instead of just wrapping proprietary API endpoints, developers can now integrate AI deeply into their products in a very cost-effective and performant way - Price race to the bottom with near-instant LLM responses at very low prices are on the horizon As a founder, it feels like a very exciting time to build a startup as your product automatically becomes better, cheaper, and more scalable with every major AI advancement. This leads to a powerful flywheel effect: https://www.kadoa.com/blog/ai-flywheel https://www.kadoa.com/blog/ai-flywheel

danielmarkbruce 2y ago
It creates the opposite of a flywheel effect for you. It creates a leapfrog effect.
- boringg 2y ago
  AI might cannabalize a lot of first gen AI businesses.
  - jstummbillig 2y ago
    What Meta is doing is borderline market distortion. It's not that they have figured out some magic sauce they are happy to share. They are just deciding to burn brute force money that they made elsewhere and give their stuff away below cost, first of all because they can.
    - anon373839 2y ago
      I know, and it's beautiful to see. Bad actors like "Open"AI tried to get in first and monopolize this tech with lawfare. But that game plan has been mooted by Meta's scorched-earth generosity.
      - jstummbillig 2y ago
        Meta has actually figured out where the moot is: Ecosystem, tooling. As soon as "we" build it, they an still do whatever they want with the core/llm, starting with Llama 4 or any other point in the future. The best kind of open source: All the important ingredients to make it work (more and more data and money) are either not open source or in the hands of Meta. It's prohibitive by design. People seem happy to help build Metas empire once again in return for scraps.
    - danielmarkbruce 2y ago
      It's strange you are downvoted for this. It is a legitimate take on things (even if it is likely not accurate as far as intent is concerned).
    - boringg 2y ago
      To be fair MSFT investments with credits into OpenAI is also almost market distortion. All the investments done with credits posing as dollars has made the VC investment world very chaotic in the AI space. No real money changing hands and the revenue on the books of MSFT and AMAZON is low quality revenue. Those companies AI moves are overvalued.
boringg 2y ago
- Price race to the bottom with near-instant LLM responses at very low prices are on the horizon Maybe a big price war while the market majors fight out for positioning but they still need to make money off their investments so someone is going to have to raise prices at some point and youll be locked into their system if you build on it.
- Havoc 2y ago
  >locked into their system There are going to be loads of providers for these open models. Openrouter already has 3 providers for the new 405B model within hours.
  - boringg 2y ago
    Maybe for the time being. I don't see how else they monetize the incredible amount the spent on the models without forcing people to lock into models or benefits or something else. It's not going to stay like this I can assure you that :).
    - Havoc 2y ago
      Not sure whether you mean by that post open router serving the 405b or meta producing more. Open router is a paid api so that can absolutely be sustainable. And meta has multiple reasons for going open route - some explained in their posts so less so (harms their competitors) I reckon there will be a llama 4 and beyond
    - tim333 2y ago
      Meta will make money like it has in the past by having data about users and advertising to them. Commoditizing AI helps them keep at that. See Joel on Software "Smart companies try to commoditize their products’ complements" https://www.joelonsoftware.com/2002/06/12/strategy-letter-v/ https://www.joelonsoftware.com/2002/06/12/strategy-letter-v/
- wavemode 2y ago
  > they still need to make money off their investments Depends on how you define this. Most of the top companies don't care as much about making a profit off of AI inference itself, if the existence of the -feature- of AI inference drives more usage and/or sales of their other products (phones, computers, operating systems, etc.) That's why, for example, Google and Bing searches automatically perform LLM inference at no cost to the user.
choppaface 2y ago
Also the opportunity to run on user compute and on private data. That supports a slate of business models that are incompatible with the mainframe approach. Including adtech models, which are predominantly cloud-based.
drcode 2y ago
and Xi Jingping

danielmarkbruce 2y ago

It creates the opposite of a flywheel effect for you. It creates a leapfrog effect.

boringg 2y ago
AI might cannabalize a lot of first gen AI businesses.
- jstummbillig 2y ago
  What Meta is doing is borderline market distortion. It's not that they have figured out some magic sauce they are happy to share. They are just deciding to burn brute force money that they made elsewhere and give their stuff away below cost, first of all because they can.
  - anon373839 2y ago
    I know, and it's beautiful to see. Bad actors like "Open"AI tried to get in first and monopolize this tech with lawfare. But that game plan has been mooted by Meta's scorched-earth generosity.
    - jstummbillig 2y ago
      Meta has actually figured out where the moot is: Ecosystem, tooling. As soon as "we" build it, they an still do whatever they want with the core/llm, starting with Llama 4 or any other point in the future. The best kind of open source: All the important ingredients to make it work (more and more data and money) are either not open source or in the hands of Meta. It's prohibitive by design. People seem happy to help build Metas empire once again in return for scraps.
  - danielmarkbruce 2y ago
    It's strange you are downvoted for this. It is a legitimate take on things (even if it is likely not accurate as far as intent is concerned).
  - boringg 2y ago
    To be fair MSFT investments with credits into OpenAI is also almost market distortion. All the investments done with credits posing as dollars has made the VC investment world very chaotic in the AI space. No real money changing hands and the revenue on the books of MSFT and AMAZON is low quality revenue. Those companies AI moves are overvalued.

boringg 2y ago

- Price race to the bottom with near-instant LLM responses at very low prices are on the horizon Maybe a big price war while the market majors fight out for positioning but they still need to make money off their investments so someone is going to have to raise prices at some point and youll be locked into their system if you build on it.

Havoc 2y ago
>locked into their system There are going to be loads of providers for these open models. Openrouter already has 3 providers for the new 405B model within hours.
- boringg 2y ago
  Maybe for the time being. I don't see how else they monetize the incredible amount the spent on the models without forcing people to lock into models or benefits or something else. It's not going to stay like this I can assure you that :).
  - Havoc 2y ago
    Not sure whether you mean by that post open router serving the 405b or meta producing more. Open router is a paid api so that can absolutely be sustainable. And meta has multiple reasons for going open route - some explained in their posts so less so (harms their competitors) I reckon there will be a llama 4 and beyond
  - tim333 2y ago
    Meta will make money like it has in the past by having data about users and advertising to them. Commoditizing AI helps them keep at that. See Joel on Software "Smart companies try to commoditize their products’ complements" https://www.joelonsoftware.com/2002/06/12/strategy-letter-v/ https://www.joelonsoftware.com/2002/06/12/strategy-letter-v/
wavemode 2y ago
> they still need to make money off their investments Depends on how you define this. Most of the top companies don't care as much about making a profit off of AI inference itself, if the existence of the -feature- of AI inference drives more usage and/or sales of their other products (phones, computers, operating systems, etc.) That's why, for example, Google and Bing searches automatically perform LLM inference at no cost to the user.

choppaface 2y ago

Also the opportunity to run on user compute and on private data. That supports a slate of business models that are incompatible with the mainframe approach. Including adtech models, which are predominantly cloud-based.

drcode 2y ago

and Xi Jingping