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You don't have to enter an email address! There is a close button very conveniently placed. I will leave the rest as an exercise for the reader. Ed acknowledge

You don't have to enter an email address! There is a close button very conveniently placed. I will leave the rest as an exercise for the reader. Ed acknowledges that we don't know their inference costs in the article. But unless they made a Deepseek level of breakthrough in serving through API, they are either breaking even or losing money at each call. There is a race to the bottom and survival of the deepest pockets right now in the field. And this "subsidy" funded by investors will not last.

handfuloflight 1y ago
Not to be troublesome, but I don't see the close button and I zoomed in and combed for it.
- danmarket 1y ago
  Might be your browser or add-ons or something, on both of my devices it is visible. Also clicking in greyed out region dismisses it.
  - handfuloflight 1y ago
    Same thing in incognito. There's no button. There's no greyed out region either.
    - danmarket 1y ago
      I see, you mean the paywall part not the "Subscribe to the Newsletter" message. I misunderstood and I apologize. While rest of the article is worth reading, the main message is already in the free part: "Anthropic is changing their pricing, and it is probably because they are losing money much faster than they intended to" (e.g. bleeding out)
mcphage 1y ago
> And this "subsidy" funded by investors will not last. That’s what they said about Uber, too, but it’s still around.
- danmarket 1y ago
  https://www.nytimes.com/2021/06/08/technology/farewell-millennial-lifestyle-subsidy.html https://www.nytimes.com/2021/06/08/technology/farewell-mille... Well, they are around because they increased the prices for customers, reduced the pay for gig-workers and added ads.
  - handfuloflight 1y ago
    But their prices didn't increase by a factor of 30. That's roughly how much inference I'm getting for each dollar put into the Max subscription.
    - danmarket 1y ago
      I should clarify that I don't think Anthropic will go out of business. Similar to Ed, I am purely looking at this as business analysis and their actions indicate that they are starting to change parameters of their business model. Comparing Uber to Anthropic is not correct, because their cost models are not the same. Uber has mainly labor cost which is low-skill and high-volume, followed by service costs which are high-skill but low-volume. Which leaves a lot of room for optimization. Anthropic has very big bills to pay, and those bills will only go up as they scale. In depth analysis of frontier model companies is difficult, since they are private and secretive.
      - handfuloflight 1y ago
        You really don't think compute costs won't be more tameable than human labor cost? What very big bills are you referring to?
        danmarket 1y ago
        If they remain as ambitious as they are/were in interviews, they are going to build larger multi-modal models. If they are loyal to their initial philosophy "Achieve safe AGI by using lead time" then they will try to outspend everybody else. Content of their spending cannot be known without insider information (which I don't have), but this business model is ripe for inefficiency for the sake of obtaining first mover's advantage. It is "unpopular" to say this, especially this bluntly, but low-skill labor can be made as cheap as you want it to be. If my numbers aren't wrong, average Uber/Lyft worker works for less than hourly local minimum wage (don't say tips, ~80% of Uber customers don't tip). But they accept it because of lack of opportunity, flexibility of gig jobs, and potential for working many jobs.
oidar 1y ago
You have to subscribe to see the full article. Scroll all the way down to: Read the full story Sign up now to read the full story and get access to all posts for paying subscribers only.

handfuloflight 1y ago

Not to be troublesome, but I don't see the close button and I zoomed in and combed for it.

danmarket 1y ago
Might be your browser or add-ons or something, on both of my devices it is visible. Also clicking in greyed out region dismisses it.
- handfuloflight 1y ago
  Same thing in incognito. There's no button. There's no greyed out region either.
  - danmarket 1y ago
    I see, you mean the paywall part not the "Subscribe to the Newsletter" message. I misunderstood and I apologize. While rest of the article is worth reading, the main message is already in the free part: "Anthropic is changing their pricing, and it is probably because they are losing money much faster than they intended to" (e.g. bleeding out)

mcphage 1y ago

> And this "subsidy" funded by investors will not last. That’s what they said about Uber, too, but it’s still around.

danmarket 1y ago
https://www.nytimes.com/2021/06/08/technology/farewell-millennial-lifestyle-subsidy.html https://www.nytimes.com/2021/06/08/technology/farewell-mille... Well, they are around because they increased the prices for customers, reduced the pay for gig-workers and added ads.
- handfuloflight 1y ago
  But their prices didn't increase by a factor of 30. That's roughly how much inference I'm getting for each dollar put into the Max subscription.
  - danmarket 1y ago
    I should clarify that I don't think Anthropic will go out of business. Similar to Ed, I am purely looking at this as business analysis and their actions indicate that they are starting to change parameters of their business model. Comparing Uber to Anthropic is not correct, because their cost models are not the same. Uber has mainly labor cost which is low-skill and high-volume, followed by service costs which are high-skill but low-volume. Which leaves a lot of room for optimization. Anthropic has very big bills to pay, and those bills will only go up as they scale. In depth analysis of frontier model companies is difficult, since they are private and secretive.
    - handfuloflight 1y ago
      You really don't think compute costs won't be more tameable than human labor cost? What very big bills are you referring to?
      - danmarket 1y ago
        If they remain as ambitious as they are/were in interviews, they are going to build larger multi-modal models. If they are loyal to their initial philosophy "Achieve safe AGI by using lead time" then they will try to outspend everybody else. Content of their spending cannot be known without insider information (which I don't have), but this business model is ripe for inefficiency for the sake of obtaining first mover's advantage. It is "unpopular" to say this, especially this bluntly, but low-skill labor can be made as cheap as you want it to be. If my numbers aren't wrong, average Uber/Lyft worker works for less than hourly local minimum wage (don't say tips, ~80% of Uber customers don't tip). But they accept it because of lack of opportunity, flexibility of gig jobs, and potential for working many jobs.

oidar 1y ago

You have to subscribe to see the full article. Scroll all the way down to: Read the full story Sign up now to read the full story and get access to all posts for paying subscribers only.