4 ms·

We still don't have a commercially viable product though?

by AstroBen 11mo ago

aurareturn 11mo ago
If all frontier LLM labs agreed to a truce and stopped training to save on cost, LLMs would be immensely profitable now.
- AstroBen 11mo ago
  That isn't what I've seen: https://www.wheresyoured.at/oai_docs/ https://www.wheresyoured.at/oai_docs/
  - aurareturn 11mo ago
    https://simonwillison.net/2025/Aug/17/sam-altman/#:~:text=Subscribe,2025%20at%2012:53%20am https://simonwillison.net/2025/Aug/17/sam-altman/#:~:text=Su... Also independent analysis: https://news.ycombinator.com/threads?id=aurareturn&next=45961994 https://news.ycombinator.com/threads?id=aurareturn&next=4596...
  - logicprog 11mo ago
    Those are effectively made up numbers, since they're given to him by an anonymous source we have no way of corroborating, and we can't even see the documents themselves, and it contradicts not just OpenAI's official numbers, but first principles analyses of what the economics of inference should be[1] and the inference profit reports of other companies, as well as just an analysis of the inference market would suggest[2] [1]: https://martinalderson.com/posts/are-openai-and-anthropic-really-losing-money-on-inference/ https://martinalderson.com/posts/are-openai-and-anthropic-re..., https://github.com/deepseek-ai/open-infra-index/blob/main/202502OpenSourceWeek/day_6_one_more_thing_deepseekV3R1_inference_system_overview.md https://github.com/deepseek-ai/open-infra-index/blob/main/20... [2]: https://www.snellman.net/blog/archive/2025-06-02-llms-are-cheap/ https://www.snellman.net/blog/archive/2025-06-02-llms-are-ch...
amypetrik8 11mo ago
google what you just said and look at the top hit it's a AI summary google eats that ad revenue it eats the whole thing it blocked your click on the link... it drinks your milkshake so, yes, there a 100 billion commercially viable product
- skylissue 11mo ago
  And so ends the social contract of the web, the virtuous cycle of search engines sending traffic to smaller sites which collect ad revenue which in turn boosts search engine usage. To thunderous applause.
  - cindyllm 11mo ago
    [dead]
  - saikia81 10mo ago
    Thank god. The fake search results, the money that manipulates our access to information. all gone. Finally we can try something else. I have a feeling it's going to be worse though.
- bakedoatmeal 11mo ago
  Google Search has 3 sources of revenue that I am aware of: ad revenue from the search results page, sponsored search results, and AdSense revenue on the websites the user is directed to. If users just look at the AI overview at the top of the search page, Google is hobbling two sources of revenue (AdSense, sponsored search results), and also disincentivizing people from sharing information on the web that makes their AI overview useful. In the process of all this they are significantly increasing the compute costs for each Google search. This may be a necessary step to stay competitive with AI startups' search products, but I don't think this is a great selling point for AI commercialization.
zaptrem 11mo ago
I've fed thousands of dollars to Anthropic/OAI/etc for their coding models over the past year despite never having paid for dev tools before in my life. Seems commercially viable to me.
- chroma205 11mo ago
  > I've fed thousands of dollars to Anthropic/OAI/etc for their coding models over the past year despite never having paid for dev tools before in my life. Seems commercially viable to me. For OpenAI to produce a 10% return, every iPhone user on earth needs to pay $30/month to OpenAI. That ain’t happening.
  - zaptrem 11mo ago
    Not sure where that math is coming from. Assuming it's true, you're ignoring that some users (me) already pay 10X that. Btw according Meta's SEC filings: https://s21.q4cdn.com/399680738/files/doc_financials/2023/q4/Earnings-Presentation-Q4-2023.pdf https://s21.q4cdn.com/399680738/files/doc_financials/2023/q4... they made around $22/month/american user (not even heavy user or affluent iPhone owner) in q3 2023. I assume Google would be higher due to larger marketshare.
    - disgruntledphd2 11mo ago
      A banks sell side analyst team, which is quite different.
  - menaerus 11mo ago
    They don't sell their models to individuals only but also to companies with most likely different business and pricing models so that's an overly simplistic view of their business. YoY their spending increases, we can safely assume that one of the reasons is the growing user base. Time will probably come when we won't be allowed to consume frontier models without paying anything, as we can today, and time will come when this $30 will most likely become double or triple the price. Though the truth is that R&D around AI models, and especially their hosting (inference), is expensive and won't get any cheaper without significant algorithmic improvements. According to the history, my opinion is that we may very well be ~10 years from that moment. EDIT: HSBC has just published some projections. From https://archive.ph/9b8Ae#selection-4079.38-4079.42 https://archive.ph/9b8Ae#selection-4079.38-4079.42 > Total consumer AI revenue will be $129bn by 2030 > Enterprise AI will be generating $386bn in annual revenue by 2030 > OpenAI’s rental costs will be a cumulative $792bn between the current year and 2030, rising to $1.4tn by 2033 > OpenAI’s cumulative free cash flow to 2030 may be about $282bn > Squaring the first total off against the second leaves a $207bn funding hole So, yes, expensive (mind the rental costs only) ... but forseen to be penetrating into everything imagineable.
nimchimpsky 11mo ago
[dead]

We still don't have a commercially viable product though?

If all frontier LLM labs agreed to a truce and stopped training to save on cost, LLMs would be immensely profitable now.

AstroBen 11mo ago
That isn't what I've seen: https://www.wheresyoured.at/oai_docs/ https://www.wheresyoured.at/oai_docs/
- aurareturn 11mo ago
  https://simonwillison.net/2025/Aug/17/sam-altman/#:~:text=Subscribe,2025%20at%2012:53%20am https://simonwillison.net/2025/Aug/17/sam-altman/#:~:text=Su... Also independent analysis: https://news.ycombinator.com/threads?id=aurareturn&next=45961994 https://news.ycombinator.com/threads?id=aurareturn&next=4596...
- logicprog 11mo ago
  Those are effectively made up numbers, since they're given to him by an anonymous source we have no way of corroborating, and we can't even see the documents themselves, and it contradicts not just OpenAI's official numbers, but first principles analyses of what the economics of inference should be[1] and the inference profit reports of other companies, as well as just an analysis of the inference market would suggest[2] [1]: https://martinalderson.com/posts/are-openai-and-anthropic-really-losing-money-on-inference/ https://martinalderson.com/posts/are-openai-and-anthropic-re..., https://github.com/deepseek-ai/open-infra-index/blob/main/202502OpenSourceWeek/day_6_one_more_thing_deepseekV3R1_inference_system_overview.md https://github.com/deepseek-ai/open-infra-index/blob/main/20... [2]: https://www.snellman.net/blog/archive/2025-06-02-llms-are-cheap/ https://www.snellman.net/blog/archive/2025-06-02-llms-are-ch...

amypetrik8 11mo ago

google what you just said and look at the top hit it's a AI summary google eats that ad revenue it eats the whole thing it blocked your click on the link... it drinks your milkshake so, yes, there a 100 billion commercially viable product

skylissue 11mo ago
And so ends the social contract of the web, the virtuous cycle of search engines sending traffic to smaller sites which collect ad revenue which in turn boosts search engine usage. To thunderous applause.
- cindyllm 11mo ago
  [dead]
- saikia81 10mo ago
  Thank god. The fake search results, the money that manipulates our access to information. all gone. Finally we can try something else. I have a feeling it's going to be worse though.
bakedoatmeal 11mo ago
Google Search has 3 sources of revenue that I am aware of: ad revenue from the search results page, sponsored search results, and AdSense revenue on the websites the user is directed to. If users just look at the AI overview at the top of the search page, Google is hobbling two sources of revenue (AdSense, sponsored search results), and also disincentivizing people from sharing information on the web that makes their AI overview useful. In the process of all this they are significantly increasing the compute costs for each Google search. This may be a necessary step to stay competitive with AI startups' search products, but I don't think this is a great selling point for AI commercialization.

zaptrem 11mo ago

I've fed thousands of dollars to Anthropic/OAI/etc for their coding models over the past year despite never having paid for dev tools before in my life. Seems commercially viable to me.

chroma205 11mo ago
> I've fed thousands of dollars to Anthropic/OAI/etc for their coding models over the past year despite never having paid for dev tools before in my life. Seems commercially viable to me. For OpenAI to produce a 10% return, every iPhone user on earth needs to pay $30/month to OpenAI. That ain’t happening.
- zaptrem 11mo ago
  Not sure where that math is coming from. Assuming it's true, you're ignoring that some users (me) already pay 10X that. Btw according Meta's SEC filings: https://s21.q4cdn.com/399680738/files/doc_financials/2023/q4/Earnings-Presentation-Q4-2023.pdf https://s21.q4cdn.com/399680738/files/doc_financials/2023/q4... they made around $22/month/american user (not even heavy user or affluent iPhone owner) in q3 2023. I assume Google would be higher due to larger marketshare.
  - disgruntledphd2 11mo ago
    A banks sell side analyst team, which is quite different.
- menaerus 11mo ago
  They don't sell their models to individuals only but also to companies with most likely different business and pricing models so that's an overly simplistic view of their business. YoY their spending increases, we can safely assume that one of the reasons is the growing user base. Time will probably come when we won't be allowed to consume frontier models without paying anything, as we can today, and time will come when this $30 will most likely become double or triple the price. Though the truth is that R&D around AI models, and especially their hosting (inference), is expensive and won't get any cheaper without significant algorithmic improvements. According to the history, my opinion is that we may very well be ~10 years from that moment. EDIT: HSBC has just published some projections. From https://archive.ph/9b8Ae#selection-4079.38-4079.42 https://archive.ph/9b8Ae#selection-4079.38-4079.42 > Total consumer AI revenue will be $129bn by 2030 > Enterprise AI will be generating $386bn in annual revenue by 2030 > OpenAI’s rental costs will be a cumulative $792bn between the current year and 2030, rising to $1.4tn by 2033 > OpenAI’s cumulative free cash flow to 2030 may be about $282bn > Squaring the first total off against the second leaves a $207bn funding hole So, yes, expensive (mind the rental costs only) ... but forseen to be penetrating into everything imagineable.

nimchimpsky 11mo ago

[dead]