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What is their moat besides incredibly deep war chests? It’s the same for all foundation model companies. The moat is how much money that have to sell inference
by dartos 2y ago
What is their moat besides incredibly deep war chests?
It’s the same for all foundation model companies. The moat is how much money that have to sell inference and pay for training.
- aipatselarom 2y agoYeah, you're right. They'll be out of business very soon! /s
- deleted 2y ago[deleted]
- dartos 2y agoI never once suggested that… You can stay in business for a long time with no moat and billions of dollars. Long enough to find a moat even.
- CharlesW 2y agoChatGPT is more than a foundation model. To use Claude as an example of where competitors are failing in comparison, you can't even do extremely basic stuff like upload PowerPoint decks or Excel spreadsheets, much less create custom GPTs.
- dartos 2y agoSure, but none of that is moat. It’s just a feature on someone’s backlog. The proof of that is chatgpt itself. OpenAI did not pioneer a lot of those kinds of features. They saw startups doing it and just did it themselves since it’s fairly straightforward to implement. A scrappy startup can copy the vast majority of chatgpt features with another foundation model. Custom GPTs are just prompts.
- CharlesW 2y ago> Sure, but none of that is moat. Not for foundation models, and not when considered individually. But as long as OpenAI continues killing it with foundation models, continues moving up the stack with applications built on those models, and continues establishing market-leading parterships/integrations with companies like Microsoft and Apple, that's a moat.
- moofer9 2y agoThat’s…not a moat. Here, I’ll let chatgpt tell you: True moats often involve factors like network effects, brand strength, intellectual property, or significant operational efficiencies that are harder to replicate. Superman doesn’t have a competitive moat, even if he manages to be the strongest and produce random powers out of nowhere - other superheroes pop up and monopolize various cities despite being nowhere near as powerful. Why? They are the recognizable local brand. That’s a moat. It’s not something Superman can easily do anything about. Heck, Superman’s strength even makes him unrelatable to most humans, actively harming him in the brand area.
- CharlesW 2y agoThe Superman analogy is fun, but moats are rarely that simple. About the real-world scenario I described, ChatGPT generated: "The combination of OpenAI’s advancements in foundation models, application development, and strategic partnerships collectively creates a robust moat for several reasons: [list of reasons] "Together, these elements form a substantial moat. OpenAI’s cutting-edge models create a technological barrier, its applications generate a sticky user base, and its partnerships expand its influence and operational support, making it difficult for competitors to replicate its entire ecosystem. This combination of technological, user-based, and strategic advantages creates a robust, multi-layered moat around OpenAI in the competitive AI landscape."
- lumost 2y ago>A scrappy startup can copy the vast majority of chatgpt features with another foundation model. Software is expensive to build, adoption is more expensive. If you ever try to convince someone to migrate in a B2B setting - you'll learn that its not enough to be cheaper, or better - you need to either be 10x cheaper or provide a next level experience that makes the existing product seem like a liability. If you could copy ChatGPT's functionality (getting more expensive by the day), and offer it for $2/month - then folks might migrate. Otherwise the switching cost is too high for most.
- dartos 2y ago> If you could copy ChatGPT's functionality (getting more expensive by the day) You can. You can also make the core functionality of Twitter in a weekend. Building software at this high a level isn’t too expensive or difficult, especially since the LLM provider you’d use handles the most difficult scaling issues for you. > and offer it for $2/month This you can’t really do. OpenAI can’t either tbf, they just have the runway to charge whatever they feel like… that cash is their moat.
- ThalesX 2y agoI use it for some reports every month and Claude is so much better than OpenAI's frontier models it's not even funny. I can upload CSV, JSON, PDF, any type of text file...
- minimaxir 2y ago> you can't even do extremely basic stuff like upload PowerPoint decks or Excel spreadsheets That's a UX implementation, not a moat. There's nothing ChatGPT-specific about vector stores/the Assistants API that Claude can't copy if there's enough demand.