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Today Apple launched its revamped AI offering. Judging by several reports, Apple pays Google a mere billion dollars a year to operate it. Essentially just licen

by dofm 5mo ago

Today Apple launched its revamped AI offering. Judging by several reports, Apple pays Google a mere billion dollars a year to operate it. Essentially just licensing the IP. Google are (allegedly) happy to turn over the right to operate and distill their models for only a billion a year. Consumer revenue is only a smallish share of the puzzle, but still: If you are a consumer and you have a Mac or an iPhone, what do you need from AI that Apple's new offering won't provide? Why would you pay for ChatGPT, or even tolerate its inevitably increasingly desperate ad placements? Assume Google will have similar tools in their phones, and Google search will continue to have the offering it does. In short, where is the evidence that once Apple's tech exists, consumer AI is worth, to Anthropic or OpenAI, anything noticeably more than that $1B a year? Maybe OpenAI strikes a deal to put something in Samsung phones. Let's say Samsung is ten times as desperate as Apple (which is how it looks, often). Still only $10B a year? 2026 consumer revenue projections from OpenAI are pitched at $14-15 billion, apparently. If they get that, it's the only year they will get that, because by late this year, everyone with an iPhone will have something useful built in. Ed Zitron is a mouthy British rabble-rouser, but I think he is probably mostly on the money.

jredwards 5mo ago
I expect that a lot of the money will be in Enterprise AI.
- dofm 5mo ago
  Right but OpenAI are for real making that prediction about their consumer revenue, which seems decidedly ambitious (considering that they are making nothing from their current phone placement). And they have said that they expect it to be quite a large share! https://mlq.ai/news/openai-projects-over-280-billion-revenue-by-2030-amid-adjusted-compute-spending/ https://mlq.ai/news/openai-projects-over-280-billion-revenue... "OpenAI projects revenue will be divided nearly equally between its consumer and enterprise business units by 2030" That it is so absurdly ambitious and so likely to run up against reality strikes me as really indicative of the quality of the envelopes these calculations are being sketched on.
  - mike_hearn 5mo ago
    Fidji Simo had to take medical leave so they're behind on their advertising platform. But in principle that could make a ton of money.
  - jredwards 5mo ago
    I think OpenAI is just getting beaten so badly in the Enterprise space that they have to make rosy predictions about the consumer space.
- thewebguyd 5mo ago
  I think so too (Enterprise), but I think its going to look different from "Pay subscription for access to a model from OpenAI/Anthropic/Google." I don't think people will be doing business with the labs directly. "Enterprise AI" will be distilled down into purpose built products, with the model just basically being a generic commodity, and nearly irrelevant to the enterprises buying whatever these products are much like how I don't care if whatever SaaS was built in React, Vue, or some other framework as long as it works. Ironically, for as much shit as they get about Copilot, Microsoft I think has the right idea for the long game they just suck at execution. Copilot is the tool, integrated into the rest of their enterprise stack, it doesn't care what the model is behind the scenes (they already offer you the ability to choose between different models). That doesn't really bode well for the labs and their trillion dollar IPOs, because they are effectively reduced down to being a developer framework.
- pitched 5mo ago
  The free Chinese models are always approaching frontier-level power. The cost to Enterprise to run these models is where Anthropic and OpenAI are competing against in the long run.
- windexh8er 5mo ago
  That's cool, but the enterprise is cheap. If you have any proximity to sales in the space you know that procurement and lawyers exist that have a full time job redlining purchase orders and agreements to the N-th degree. The enterprise will pay for something that will make them money or prevent them from losing it. But the enterprise isn't paying a premium and they know that. Even within the Fortune 5 of the US if be surprised if any of them are paying more than $1B annually currently in total. And then you can take the parent context into account. If they can just equip users with a slightly more expensive Mac and call their Dell rep to order a few thousand DGX Spark to handle the rest... Why would they risk their trade secrets and intimate details flowing into models that may or may not be trustworthy long term? Most large enterprise have been burned by SaaS over the years in some way. I can't imagine there aren't architects in the large organizations that are truly weighing how to effectively use AI. And beyond that we're seeing more and more progress in SLMs and orchestration agents which become easier to run at scale on-prem.
  - baq 5mo ago
    > If you have any proximity to sales in the space you know that procurement and lawyers exist that have a full time job redlining purchase orders and agreements to the N-th degree. AWS billing.
famouswaffles 5mo ago
>If you are a consumer and you have a Mac or an iPhone, what do you need from AI that Apple's new offering won't provide? Why would you pay for ChatGPT, or even tolerate its inevitably increasingly desperate ad placements? Probably the same reason the Gemini app is still well behind ChatGPT in consumer usage and adoption despite being preinstalled on android phones worldwide ? Why are people using GPT on Windows. There's even a copilot button on new keyboards! Or maybe its the same reason Microsoft Edge is not the most popular Windows browser ? Maybe its the same reason Instagram threads did not even dent Tiktok ? You are asking the question the wrong way around. People use and like what they like and have a strong preference to continue doing so. This is just human behaviour. You don't need mind blowing moat. You begin to have problems only when: - Users are constantly using your product unsatisifed. - There's a competitor(s) with a significantly better offering that people are talking about. Will Apple's offering be providing any meaningful/significant benefit over just using GPT ? If not, don't expect any miracles.
- dofm 5mo ago
  > Will Apple's offering be providing any meaningful/significant benefit over just using GPT ? If not, don't expect any miracles. Judging by the announcements today about its integration into the OSes? They are offering useful things ChatGPT cannot offer unless they write an "everything app". One can (maybe should) make the argument that this is the browser monopoly again, but given that the USA has seemingly no intention of ever litigating that question again even if the EU does, there are clearly features here that OpenAI is effectively locked out of offering.
  - famouswaffles 5mo ago
    Just because Apple said they're 'integrating into the OS' (which can really mean a lot of things) doesn't mean they'll offer something users will actually care about that Open AI can't match.
    - discreteevent 5mo ago
      > that Open AI can't match. Open AI can match it but at what price?
major505 5mo ago
This would be greate for google, because most people, specially in the apple environment don't much care to install new tools if they have a native tool that works reasonable well. If you have an ai assistant that's minimally competent in your desktop or phone, you will not care to go after chatgpt or alternatives, and google will receive tons of data to improve their models.
iknowstuff 5mo ago
ChatGPT has >1B users globally a mere 3 years in. iPhone is at 1.5B mostly concentrated in rich areas.
- dofm 5mo ago
  Only maybe fifty million of them are paying, though.
- dwaite 5mo ago
  It does not look nearly as good when you compare paying customers.
al_borland 5mo ago
> If you are a consumer and you have a Mac or an iPhone, what do you need from AI that Apple's new offering won't provide? I've been using Kagi Assistant for my AI needs, and have to say, Siri will probably replace it in the fall. The question will be, will I still want to keep Kagi for search, or will this new Siri get me where I need to be on all fronts? I need to start paying more attention to how often I actually use the search results vs just the AI summary. There are things I didn't see Apple show and I wonder how Siri will handle it. One example would be basic coding. They mentioned LLMs in Xcode and Siri with the Shortcuts app and Safari Extensions, but I just had Kagi write up a webpage as a means to display a bunch of data it gave me. Gemini could also do this, so maybe it's not a problem for Siri, but it remains to be seen. There is also a question of what the experience will be like. ChatGPT, for example, handles writing up this code is a much nicer way than Kagi Assistant. Kagi feels more like the results I would have had from ChatGPT a couple years ago where it just dumps out the code in a block and any change is an entirely new code dump, meanwhile ChatGPT goes into a coding interface with a live editor. Going to Xcode feels like overkill, Siri will probably be not enough... so that's a gap in the market Apple may not serve. I assume there will be several things like this. The prosumer level of AI usage, if you will.
- jimbokun 5mo ago
  Very very few consumers will be looking to use an AI to write code for them.
  - chatmasta 5mo ago
    They will, but they won’t realize it’s writing code. It will look like Claude Cowork, which writes code for itself under the hood but is results-oriented for the user.
    - TylerE 5mo ago
      Co-work is damn near magic. I've been working on a mapping project the past few days, am probably a couple hundred prompts deep in to it (I'm doing some very weird stuff with the data to produce a hybrid map). The processing pipeline is something like 12k lines of python and counting.
Yizahi 5mo ago
Let's imagine for a second that this a few billion dollars per year to Google is correct. Why do you assume that it covers everything to be done by Google itself - from hosting to running actual servers? Apple may very well pay Google a licensing fee, take a trained LLM and run inference themselves locally or even at a yet another 3rd party for example a datacenter corporation or any mix of these. And then a true real cost of running just the inference on every Apple device would be separated into a completely different org payment flows, very obscured and higher than just a license fee. I'm not saying that this is what really happens. I'm saying that believing a CEO is as foolish and as grounded in reality as believing Ed Zitron.
- dofm 5mo ago
  > Why do you assume that it covers everything to be done by Google itself - from hosting to running actual servers? I don't, and that's the point, isn't it? It's the keys to a substantial chunk of the kingdom for $1B a year. Literally they are getting, for a very small price, the right to distill their own models from Gemini. Is there money in this for someone with a data centre? Possibly. Is there money in it for NVIDIA? Possibly. But either way, that's not OpenAI or Anthropic, is it?
  - aix1 5mo ago
    > It's the keys to a substantial chunk of the kingdom for $1B a year. Literally they are getting, for a very small price, the right to distill their own models from Gemini. Here is a different interpretation: Apple bought the rights to distill and use a smaller version of one unspecified model in the Gemini family (there are many such models). The distillation will be carried out at Google's data centres so that the original weights never leave Google premises. For this to be keys to be kingdom it would need to cover all current and future models and would need to be very permissive with regards to distillation parameters and allowed uses of the distilled model. I expect the reality to be somewhere between these two extremes.
hparadiz 5mo ago
You are kind of glossing over the B2B market where contract pricing is basically just MBA vibes and the fact that people don't really care necessarily about the performance of the language model once it hits a baseline. They care about how it integrates into their lives. Precisely where first mover advantage comes into play. Having to train a language model all over again is it's own sunk cost.
- cyanydeez 5mo ago
  b2b needs actual ROI and that's no where near. CEOs would be yelling loudly if this were returning them cash instead they're just jettison people to afford the bills.
- shimman 5mo ago
  B2B absolutely cares, especially since ZIRP is unlikely to ever come back in our lifetimes. No sane corporation is going to continue to throw billions down the drain with nothing to show for it.
  - hparadiz 5mo ago
    Most people using ChatGPT aren't using it for coding. They are using it for writing emails, working with spreadsheets, doing research, and writing reports. They could not care less about the coding aspect of language models. ZIRP in this context is meaningless. It's just another expense for every law and accounting firm. There's an entire world beyond tech jumping into this stuff right now. Like to give you perspective on this. I called my aunt in Germany who is an almost retired MD and she was the one that brought up ChatGPT and Claude to me.
- dofm 5mo ago
  OpenAI themselves said, in their revenue projections, that they expect the consumer vs enterprise revenue split to be 50:50, though — see: https://news.ycombinator.com/item?id=48451053 https://news.ycombinator.com/item?id=48451053
  - hparadiz 5mo ago
iyeyerjdsd 5mo ago
[dead]
gerdesj 5mo ago
"Ed Zitron is a" gobby ... British rabble-rouser. "Gob" is the Dick van Dyke approved word for mouth.
wrsh07 5mo ago
> 2026 consumer revenue projections from OpenAI are pitched at $14-15 billion, apparently. If they get that, it's the only year they will get that Would you care to wager on that? Because I would gladly take the other side at even odds. > consumer AI is worth, to Anthropic Anthropic does not really care about consumer AI. I expect consumer is where their least profitably customers are. My primary expectation is that Apple will mostly increase usage of AI by general consumers. To me, this reads like Instagram adding stories. Did it stop Snapchat's growth? Sure. But I would be cautious about claiming it will take too many users away from OpenAI. I think it will be a fairly different product offering. If you're paying to use ChatGPT right now, you might be using it for hobby coding, projects, or image generation. If you're paying a lot for ChatGPT, you're almost certainly using it for personal programming projects. The $100/month (and up) subscribers aren't going to churn because of this, and I would be extremely surprised if the $20/month users do in any meaningful way.
- dofm 5mo ago
  > Would you care to wager on that? I don't gamble. Though you might not be alone taking the bet: https://www.notus.org/technology/trump-blindsided-ai-companies-equity-meeting-plan https://www.notus.org/technology/trump-blindsided-ai-compani... "OpenAI CEO Sam Altman pitched the idea of turning over shares in his company to Trump in early 2025 and discussed the matter again with senior officials in recent weeks"
- sarchertech 5mo ago
  > Because I would gladly take the other side at even odds. If you’re only giving even odds you’re not very confident in openAI at all. $15 billion is peanuts.
  - wrsh07 5mo ago
    I don't have to give them better odds then they'll accept It's a steal at even odds It's still positive EV at much worse odds but not worth my time
    - 5mo ago
chupchap 5mo ago
People who use ChatGPT have fed so much data about their own lives and interests into it. This includes a lot of information about personal lives, interests, plans, business and even family! Shifting to another AI app is painful as they would need to start from scratch.
- shironandonand 5mo ago
  making me glad I always use ChatGPT in an incognito window, guy.
- sarchertech 5mo ago
  I don’t know anyone who uses ChatGPT who cares about that stuff. Most people just use it as a Google replacement. I actively hate it when it brings in some nonsense it thinks it knows about me. I told it my income once in an attempt to use it to find the perfect rewards credit card mix. Now anytime I try to get it to search for a deal it brings up some nonsense about “as a high income individual you don’t worry about saving $X, you care more about reliability, so you don’t need to look for the lowest cost” or something similar.
  - arcanemachiner 5mo ago
    Turn off the "memory" feature in the settings. It just rots the context anyways.
  - naishoya 5mo ago
    there is the option to opt-out of personalization, opt-out of using your conversations for training, and in that process reduce or eliminate any memory the system has of your personal preferences and context. If these actions don't erode your particular use-cases for ChatGPT, and if you think you can trust the model to follow these options this might be of use. I'm not trying to say "you're using it wrong" but that taking a more active control of the instaces facing you as a user might be of some benefit. I have iterated through different option configurations to reach a level of 'customization' that more or less conforms to my own use case, and this does include opting out of any and all lasting memory between instances and across chat sessions; and adds a selection of single initialization prompts which shape the chatbot's behavior to my requirements for that session's objective. these trim most if not all af the sycophantic interactions, reduce outputs to the specific formats and contours as defined and omits any of the 'explanations of the underlying reasons behind...' which is just noise. This also has enabled some pretty useful results without ever spending a dime on a paid account: the premium behavior presented to 'potential customers' as a lure continues to work for me, and for iteration across instances and accounts is possible with machine-ready yaml context file when a single sessions hits the 90% wall : one emit and ingest cycle rotation across account profiles in firefox and i pick right up with a fresh limit. Bouncing between ChatGPT and Claude, and between models for discrete subsets of larger tasks has really been impactful for my particular needs; but as i am not working in regions of knowledge that are beyond my own expertise and because I require the model to limit responses to very specific parameters, the logic space for unchecked hallucinations is low (but not zero). The most useful project results for me have been in developing an air-gapped private menagerie of multi-domain models which uses an operating structure not dissimilar to OpenMythos; but then my background includes HPC environment development for NUMA, unikernels, MPI and bare metal hypervisor design - so getting a design plan and functional code without requiring a team of programmers and months of time in order to even start using models under my control which have zero public facing risk for the projects i'm working on is a much better place to spend limited budget on. Last gen hardware in the V100 class is perfectly capable of running and delivering the physics calculation optimizations as required and I would rather buy and/or install solar+storage to supply the electricity for token generation than rent the same from any of the frontier models AND trust that "don't train and learn from me" preferences are and continue to be followed. If your use-case is a a 'lifestyle shopping assistant' then just turning off customization might be sufficient to stop it from telling you how to live your best life.
why0hwhy 5mo ago
Mmhmm and why spend on wrapper SaaS when open or self trained on device models do the job Web SaaS gonna end up being seen as another failed play at slim clients and entirely centralized sources of pay to play access to eyeballs; more AOL-ification of networks
overgard 5mo ago
> If you are a consumer and you have a Mac or an iPhone, what do you need from AI that Apple's new offering won't provide Honestly, I don't think I need anything from AI at all. It's a convenience but it doesn't really enable anything I wasn't doing before. That's probably their biggest problem. The biggest thing is it enables non-coders to write code, but it's very debatable that that's a good thing excluding personal projects
- zymhan 5mo ago
  They were not asking for your individual opinion. They were asking why any given person would need it.
  - overgard 5mo ago
    It turns out I am any given person
    - zymhan 5mo ago
      You are missing the forest for the trees.
    - abc123abc123 5mo ago
      Yep... I've met him and I can confirm that he is in fact, any given person. To that, I might add that I'm in the same situation. AI is a convenience and light entertainment, and as such, I'm willing and ready to pay exactly 0 USD for it privately and in my business. If the price rises beyond this point, they for sure have to move it from convenience to essential and so far, I have not seen any shadow of essential.
camillomiller 5mo ago
This this this 1000 times. It’s not that the tech ain’t great, but it’s just not marketable to the levels these scammers are screaming about.

by dofm 5mo ago

jredwards 5mo ago

I expect that a lot of the money will be in Enterprise AI.

dofm 5mo ago
Right but OpenAI are for real making that prediction about their consumer revenue, which seems decidedly ambitious (considering that they are making nothing from their current phone placement). And they have said that they expect it to be quite a large share! https://mlq.ai/news/openai-projects-over-280-billion-revenue-by-2030-amid-adjusted-compute-spending/ https://mlq.ai/news/openai-projects-over-280-billion-revenue... "OpenAI projects revenue will be divided nearly equally between its consumer and enterprise business units by 2030" That it is so absurdly ambitious and so likely to run up against reality strikes me as really indicative of the quality of the envelopes these calculations are being sketched on.
- mike_hearn 5mo ago
  Fidji Simo had to take medical leave so they're behind on their advertising platform. But in principle that could make a ton of money.
- jredwards 5mo ago
  I think OpenAI is just getting beaten so badly in the Enterprise space that they have to make rosy predictions about the consumer space.
thewebguyd 5mo ago
I think so too (Enterprise), but I think its going to look different from "Pay subscription for access to a model from OpenAI/Anthropic/Google." I don't think people will be doing business with the labs directly. "Enterprise AI" will be distilled down into purpose built products, with the model just basically being a generic commodity, and nearly irrelevant to the enterprises buying whatever these products are much like how I don't care if whatever SaaS was built in React, Vue, or some other framework as long as it works. Ironically, for as much shit as they get about Copilot, Microsoft I think has the right idea for the long game they just suck at execution. Copilot is the tool, integrated into the rest of their enterprise stack, it doesn't care what the model is behind the scenes (they already offer you the ability to choose between different models). That doesn't really bode well for the labs and their trillion dollar IPOs, because they are effectively reduced down to being a developer framework.
pitched 5mo ago
The free Chinese models are always approaching frontier-level power. The cost to Enterprise to run these models is where Anthropic and OpenAI are competing against in the long run.
windexh8er 5mo ago
That's cool, but the enterprise is cheap. If you have any proximity to sales in the space you know that procurement and lawyers exist that have a full time job redlining purchase orders and agreements to the N-th degree. The enterprise will pay for something that will make them money or prevent them from losing it. But the enterprise isn't paying a premium and they know that. Even within the Fortune 5 of the US if be surprised if any of them are paying more than $1B annually currently in total. And then you can take the parent context into account. If they can just equip users with a slightly more expensive Mac and call their Dell rep to order a few thousand DGX Spark to handle the rest... Why would they risk their trade secrets and intimate details flowing into models that may or may not be trustworthy long term? Most large enterprise have been burned by SaaS over the years in some way. I can't imagine there aren't architects in the large organizations that are truly weighing how to effectively use AI. And beyond that we're seeing more and more progress in SLMs and orchestration agents which become easier to run at scale on-prem.
- baq 5mo ago
  > If you have any proximity to sales in the space you know that procurement and lawyers exist that have a full time job redlining purchase orders and agreements to the N-th degree. AWS billing.

famouswaffles 5mo ago

>If you are a consumer and you have a Mac or an iPhone, what do you need from AI that Apple's new offering won't provide? Why would you pay for ChatGPT, or even tolerate its inevitably increasingly desperate ad placements? Probably the same reason the Gemini app is still well behind ChatGPT in consumer usage and adoption despite being preinstalled on android phones worldwide ? Why are people using GPT on Windows. There's even a copilot button on new keyboards! Or maybe its the same reason Microsoft Edge is not the most popular Windows browser ? Maybe its the same reason Instagram threads did not even dent Tiktok ? You are asking the question the wrong way around. People use and like what they like and have a strong preference to continue doing so. This is just human behaviour. You don't need mind blowing moat. You begin to have problems only when: - Users are constantly using your product unsatisifed. - There's a competitor(s) with a significantly better offering that people are talking about. Will Apple's offering be providing any meaningful/significant benefit over just using GPT ? If not, don't expect any miracles.

dofm 5mo ago
> Will Apple's offering be providing any meaningful/significant benefit over just using GPT ? If not, don't expect any miracles. Judging by the announcements today about its integration into the OSes? They are offering useful things ChatGPT cannot offer unless they write an "everything app". One can (maybe should) make the argument that this is the browser monopoly again, but given that the USA has seemingly no intention of ever litigating that question again even if the EU does, there are clearly features here that OpenAI is effectively locked out of offering.
- famouswaffles 5mo ago
  Just because Apple said they're 'integrating into the OS' (which can really mean a lot of things) doesn't mean they'll offer something users will actually care about that Open AI can't match.
  - discreteevent 5mo ago
    > that Open AI can't match. Open AI can match it but at what price?

major505 5mo ago

This would be greate for google, because most people, specially in the apple environment don't much care to install new tools if they have a native tool that works reasonable well. If you have an ai assistant that's minimally competent in your desktop or phone, you will not care to go after chatgpt or alternatives, and google will receive tons of data to improve their models.

iknowstuff 5mo ago

ChatGPT has >1B users globally a mere 3 years in. iPhone is at 1.5B mostly concentrated in rich areas.

dofm 5mo ago
Only maybe fifty million of them are paying, though.
dwaite 5mo ago
It does not look nearly as good when you compare paying customers.

al_borland 5mo ago

> If you are a consumer and you have a Mac or an iPhone, what do you need from AI that Apple's new offering won't provide? I've been using Kagi Assistant for my AI needs, and have to say, Siri will probably replace it in the fall. The question will be, will I still want to keep Kagi for search, or will this new Siri get me where I need to be on all fronts? I need to start paying more attention to how often I actually use the search results vs just the AI summary. There are things I didn't see Apple show and I wonder how Siri will handle it. One example would be basic coding. They mentioned LLMs in Xcode and Siri with the Shortcuts app and Safari Extensions, but I just had Kagi write up a webpage as a means to display a bunch of data it gave me. Gemini could also do this, so maybe it's not a problem for Siri, but it remains to be seen. There is also a question of what the experience will be like. ChatGPT, for example, handles writing up this code is a much nicer way than Kagi Assistant. Kagi feels more like the results I would have had from ChatGPT a couple years ago where it just dumps out the code in a block and any change is an entirely new code dump, meanwhile ChatGPT goes into a coding interface with a live editor. Going to Xcode feels like overkill, Siri will probably be not enough... so that's a gap in the market Apple may not serve. I assume there will be several things like this. The prosumer level of AI usage, if you will.

jimbokun 5mo ago
Very very few consumers will be looking to use an AI to write code for them.
- chatmasta 5mo ago
  They will, but they won’t realize it’s writing code. It will look like Claude Cowork, which writes code for itself under the hood but is results-oriented for the user.
  - TylerE 5mo ago
    Co-work is damn near magic. I've been working on a mapping project the past few days, am probably a couple hundred prompts deep in to it (I'm doing some very weird stuff with the data to produce a hybrid map). The processing pipeline is something like 12k lines of python and counting.

Yizahi 5mo ago

Let's imagine for a second that this a few billion dollars per year to Google is correct. Why do you assume that it covers everything to be done by Google itself - from hosting to running actual servers? Apple may very well pay Google a licensing fee, take a trained LLM and run inference themselves locally or even at a yet another 3rd party for example a datacenter corporation or any mix of these. And then a true real cost of running just the inference on every Apple device would be separated into a completely different org payment flows, very obscured and higher than just a license fee. I'm not saying that this is what really happens. I'm saying that believing a CEO is as foolish and as grounded in reality as believing Ed Zitron.

dofm 5mo ago
> Why do you assume that it covers everything to be done by Google itself - from hosting to running actual servers? I don't, and that's the point, isn't it? It's the keys to a substantial chunk of the kingdom for $1B a year. Literally they are getting, for a very small price, the right to distill their own models from Gemini. Is there money in this for someone with a data centre? Possibly. Is there money in it for NVIDIA? Possibly. But either way, that's not OpenAI or Anthropic, is it?
- aix1 5mo ago
  > It's the keys to a substantial chunk of the kingdom for $1B a year. Literally they are getting, for a very small price, the right to distill their own models from Gemini. Here is a different interpretation: Apple bought the rights to distill and use a smaller version of one unspecified model in the Gemini family (there are many such models). The distillation will be carried out at Google's data centres so that the original weights never leave Google premises. For this to be keys to be kingdom it would need to cover all current and future models and would need to be very permissive with regards to distillation parameters and allowed uses of the distilled model. I expect the reality to be somewhere between these two extremes.

hparadiz 5mo ago

You are kind of glossing over the B2B market where contract pricing is basically just MBA vibes and the fact that people don't really care necessarily about the performance of the language model once it hits a baseline. They care about how it integrates into their lives. Precisely where first mover advantage comes into play. Having to train a language model all over again is it's own sunk cost.

cyanydeez 5mo ago
b2b needs actual ROI and that's no where near. CEOs would be yelling loudly if this were returning them cash instead they're just jettison people to afford the bills.
shimman 5mo ago
B2B absolutely cares, especially since ZIRP is unlikely to ever come back in our lifetimes. No sane corporation is going to continue to throw billions down the drain with nothing to show for it.
- hparadiz 5mo ago
  Most people using ChatGPT aren't using it for coding. They are using it for writing emails, working with spreadsheets, doing research, and writing reports. They could not care less about the coding aspect of language models. ZIRP in this context is meaningless. It's just another expense for every law and accounting firm. There's an entire world beyond tech jumping into this stuff right now. Like to give you perspective on this. I called my aunt in Germany who is an almost retired MD and she was the one that brought up ChatGPT and Claude to me.
dofm 5mo ago
OpenAI themselves said, in their revenue projections, that they expect the consumer vs enterprise revenue split to be 50:50, though — see: https://news.ycombinator.com/item?id=48451053 https://news.ycombinator.com/item?id=48451053
- hparadiz 5mo ago

iyeyerjdsd 5mo ago

[dead]

gerdesj 5mo ago

"Ed Zitron is a" gobby ... British rabble-rouser. "Gob" is the Dick van Dyke approved word for mouth.

wrsh07 5mo ago

> 2026 consumer revenue projections from OpenAI are pitched at $14-15 billion, apparently. If they get that, it's the only year they will get that Would you care to wager on that? Because I would gladly take the other side at even odds. > consumer AI is worth, to Anthropic Anthropic does not really care about consumer AI. I expect consumer is where their least profitably customers are. My primary expectation is that Apple will mostly increase usage of AI by general consumers. To me, this reads like Instagram adding stories. Did it stop Snapchat's growth? Sure. But I would be cautious about claiming it will take too many users away from OpenAI. I think it will be a fairly different product offering. If you're paying to use ChatGPT right now, you might be using it for hobby coding, projects, or image generation. If you're paying a lot for ChatGPT, you're almost certainly using it for personal programming projects. The $100/month (and up) subscribers aren't going to churn because of this, and I would be extremely surprised if the $20/month users do in any meaningful way.

dofm 5mo ago
> Would you care to wager on that? I don't gamble. Though you might not be alone taking the bet: https://www.notus.org/technology/trump-blindsided-ai-companies-equity-meeting-plan https://www.notus.org/technology/trump-blindsided-ai-compani... "OpenAI CEO Sam Altman pitched the idea of turning over shares in his company to Trump in early 2025 and discussed the matter again with senior officials in recent weeks"
sarchertech 5mo ago
> Because I would gladly take the other side at even odds. If you’re only giving even odds you’re not very confident in openAI at all. $15 billion is peanuts.
- wrsh07 5mo ago
  I don't have to give them better odds then they'll accept It's a steal at even odds It's still positive EV at much worse odds but not worth my time
  - 5mo ago

chupchap 5mo ago

People who use ChatGPT have fed so much data about their own lives and interests into it. This includes a lot of information about personal lives, interests, plans, business and even family! Shifting to another AI app is painful as they would need to start from scratch.

shironandonand 5mo ago
making me glad I always use ChatGPT in an incognito window, guy.
sarchertech 5mo ago
I don’t know anyone who uses ChatGPT who cares about that stuff. Most people just use it as a Google replacement. I actively hate it when it brings in some nonsense it thinks it knows about me. I told it my income once in an attempt to use it to find the perfect rewards credit card mix. Now anytime I try to get it to search for a deal it brings up some nonsense about “as a high income individual you don’t worry about saving $X, you care more about reliability, so you don’t need to look for the lowest cost” or something similar.
- arcanemachiner 5mo ago
  Turn off the "memory" feature in the settings. It just rots the context anyways.
- naishoya 5mo ago
  there is the option to opt-out of personalization, opt-out of using your conversations for training, and in that process reduce or eliminate any memory the system has of your personal preferences and context. If these actions don't erode your particular use-cases for ChatGPT, and if you think you can trust the model to follow these options this might be of use. I'm not trying to say "you're using it wrong" but that taking a more active control of the instaces facing you as a user might be of some benefit. I have iterated through different option configurations to reach a level of 'customization' that more or less conforms to my own use case, and this does include opting out of any and all lasting memory between instances and across chat sessions; and adds a selection of single initialization prompts which shape the chatbot's behavior to my requirements for that session's objective. these trim most if not all af the sycophantic interactions, reduce outputs to the specific formats and contours as defined and omits any of the 'explanations of the underlying reasons behind...' which is just noise. This also has enabled some pretty useful results without ever spending a dime on a paid account: the premium behavior presented to 'potential customers' as a lure continues to work for me, and for iteration across instances and accounts is possible with machine-ready yaml context file when a single sessions hits the 90% wall : one emit and ingest cycle rotation across account profiles in firefox and i pick right up with a fresh limit. Bouncing between ChatGPT and Claude, and between models for discrete subsets of larger tasks has really been impactful for my particular needs; but as i am not working in regions of knowledge that are beyond my own expertise and because I require the model to limit responses to very specific parameters, the logic space for unchecked hallucinations is low (but not zero). The most useful project results for me have been in developing an air-gapped private menagerie of multi-domain models which uses an operating structure not dissimilar to OpenMythos; but then my background includes HPC environment development for NUMA, unikernels, MPI and bare metal hypervisor design - so getting a design plan and functional code without requiring a team of programmers and months of time in order to even start using models under my control which have zero public facing risk for the projects i'm working on is a much better place to spend limited budget on. Last gen hardware in the V100 class is perfectly capable of running and delivering the physics calculation optimizations as required and I would rather buy and/or install solar+storage to supply the electricity for token generation than rent the same from any of the frontier models AND trust that "don't train and learn from me" preferences are and continue to be followed. If your use-case is a a 'lifestyle shopping assistant' then just turning off customization might be sufficient to stop it from telling you how to live your best life.

why0hwhy 5mo ago

Mmhmm and why spend on wrapper SaaS when open or self trained on device models do the job Web SaaS gonna end up being seen as another failed play at slim clients and entirely centralized sources of pay to play access to eyeballs; more AOL-ification of networks

overgard 5mo ago

> If you are a consumer and you have a Mac or an iPhone, what do you need from AI that Apple's new offering won't provide Honestly, I don't think I need anything from AI at all. It's a convenience but it doesn't really enable anything I wasn't doing before. That's probably their biggest problem. The biggest thing is it enables non-coders to write code, but it's very debatable that that's a good thing excluding personal projects

zymhan 5mo ago
They were not asking for your individual opinion. They were asking why any given person would need it.
- overgard 5mo ago
  It turns out I am any given person
  - zymhan 5mo ago
    You are missing the forest for the trees.
  - abc123abc123 5mo ago
    Yep... I've met him and I can confirm that he is in fact, any given person. To that, I might add that I'm in the same situation. AI is a convenience and light entertainment, and as such, I'm willing and ready to pay exactly 0 USD for it privately and in my business. If the price rises beyond this point, they for sure have to move it from convenience to essential and so far, I have not seen any shadow of essential.

camillomiller 5mo ago

This this this 1000 times. It’s not that the tech ain’t great, but it’s just not marketable to the levels these scammers are screaming about.