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>It makes me wonder if I have been living under a rock, because I have never heard of frontier labs making money. You're confusing the profit from the marginal
by asdfasgasdgasdg 6mo ago
>It makes me wonder if I have been living under a rock, because I have never heard of frontier labs making money.
You're confusing the profit from the marginal token and overall profit (basically gross margin and operating margin). The comment you're replying to is calculating that AI labs are probably making a substantial profit per paid token. It's just that so far that profit has not been able to overcome the ongoing R&D and capex costs.
- kgwgk 6mo ago> not been able to overcome the ongoing R&D and capex costs. And the cost of not-quite-paid tokens.
- margalabargala 6mo agoWhich may or may not exist, hence this thread.
- kgwgk 6mo agoNon-paid tokens do definitely exist and they weren’t included in the remark about “substantial profit per paid token”. Underpaid/subsidized tokens also exist which don’t provide “substantial profit”.
- margalabargala 6mo agoAre you talking about free promo tokens the company gives out, or are you implying that subscription tokens are sufficiently subsidized so as to be below cost?