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It really is not the same. Amazon was not profitable because it was building out logistics, and then AWS data centers. There were defensible moats around their
by lgg 2y ago
It really is not the same. Amazon was not profitable because it was building out logistics, and then AWS data centers. There were defensible moats around their business that their growth facilitated. Google built out data centers and fiber, again tangible assets they had that competitors did not.
OpenAI's spending is mostly buying compute from other people. In other words, OpenAI's growth is paying for Microsoft's data centers. The only real asset OpenAI is building are their models. While they may be the best models available today it is unclear if that those any durable advantage since everyone in the industry is advancing very quickly, and it is unclear if they can really monetize effectively them without the infrastructure to run them.
- rglullis 2y ago> The only real asset OpenAI is building are their models Which Zuckerberg is doing his best to completely turn them into commodities.
- TyrianPurple 2y ago> Which Zuckerberg is doing his best to completely turn them into commodities By giving them out for free??
- rglullis 2y agoYes, exactly. In the same way that IBM "gave away" investment in Linux to grow their IT Consulting Business revenues.
- a_wild_dandan 2y ago"Commoditize your complement."
- gosub100 2y agoAmazon was also able to grow because they weren't paying sales tax for, what, 10+ years of their existence?
- fooker 2y agoYes. This sort of incentives are what makes unicorns possible.
- n_ary 2y agoOAI moat is the brand and getting people habituated into using it more. The aim is to become synonymous to AI, same as Google is synonymous to online search(though in recent times, I am horrified to see that my non-techy friends now use Facebook to search first and then if not satisfied, goes to Google). Also, there are immense lobbying everywhere covertly, if you haven’t seen it, look at the prominent news media, AI is now akin to “productivity gain” and “innovation”, and “adapting AI or we fall behind” attitude. Look at all the hammers falling on different industries about energy waste, climate change while AI’s usage of massive energy is presented as “innovation and next generation of work and productivity gains to be unlocked”. The target for OAI(and AI wave in general) is normal people, not tech people. And when people say AI, you conveniently see OAI emerge from news, social media, your colleagues, your boss, your friends.