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I can see why Anthropic is freaking out right now. China has undermined their whole business. AI models will be basic commodities where hosting providers earn a

I can see why Anthropic is freaking out right now. China has undermined their whole business. AI models will be basic commodities where hosting providers earn a tiny margin over the raw costs rather than the predicted fortunes from being the gatekeepers to the technology.

basch 3mo ago
the writing should have been on the wall when meta did it with llama. it was very apparent that one or two entities could release a "good enough" product into the wild commoditizing the frontier of yesterday.
cootsnuck 3mo ago
[dead]
majormajor 3mo ago
Their business model always seemed to be "become IBM, gods of the mainframe and server-side-computing" and that always seemed a bit unlikely to last forever considering how thoroughly the PC disrupted that by being "good enough" without the lock-in. IMO because they speed-ran it so much (raising orders of magnitudes more, pushing out new stuff orders of magnitudes faster) it will also lead to the rest of the world catching up faster and shrinking the pool of people internal to them who continually benefit compared to what actually went on with IBM. There's only so much upside when you join a company with hundreds-of-billions valuation. I guess the other part of their business plan bet was "become literal god of AGI". Maybe it'll still happen!
- antonvs 3mo ago
  > “become literal god of AGI” That only lasts until the AGI decides their god would be more useful if turned into paperclips.
hangonhn 3mo ago
Yeah I feel like China and their OSS model companies really did the world a great service by ensuring closed source US companies don't have an monopoly on LLMs and thus capture all the value of AI development and its impact on society. It's not going to be the foundational labs that will capture all the value -- I'm sure they will do just fine. A lot of it now will flow to the companies providing the inferences and since no one has any exclusive deals, those companies will have to compete and drive the price down, which ultimately benefits the rest of us.
- techpression 3mo ago
  It’s not a service, I hope nobody thinks this is being done ”for the good of humanity” or whatever. Doesn’t mean there’s not a benefit to people, but the financial politics behind it could turn out extremely good for China, and they are very well aware of just that.
  - t-3 3mo ago
    Do American companies think about the "financial politics" of their decisions? I somehow really doubt it. Government takes sides and sometimes applies leverage to get companies to do what they want, but that's something separate from "it's a good business decision for Chinese labs to treat models as commodities". There's no need to think about geopolitics - American AI companies could easily take the same approach as the Chinese, but they all want to get exciting and huge VC cash rather than boring and less lucrative Compute-as-a-Service money.
    - techpression 3mo ago
      Chinese labs are equivalent to the Chinese state, there’s no separation. Who do you think funds the Chinese labs?
      - t-3 3mo ago
        American labs are also funded by the US government. Are they equivalent to the US state? Do Chinese and US labs/researchers exist solely in the international sphere, without any domestic concerns or individual aspirations? The Chinese have a different culture and political system than Americans, but it's not like they're ants without free will or the ability to think. I highly doubt that DeepSeek is operating solely at the behest of the CPC or that they are in business to take down the US rather than to make money.
      - Gud 3mo ago
        Before Trump 2.0, this was a decent argument.
  - 3mo ago
4d4m 3mo ago
+1, and commodification was inevitable from the outset. This was the case before China. China hate is xenophobic and unproductive: produced both model improvements and desirable products people want at this moment in time. You use the best/cheapest model for the job/user input. Parallels to the US auto industry not paying attention to its buyers and the right strategies when they lost technical dominance to other countries a few decades back.

basch 3mo ago

the writing should have been on the wall when meta did it with llama. it was very apparent that one or two entities could release a "good enough" product into the wild commoditizing the frontier of yesterday.

cootsnuck 3mo ago

[dead]

majormajor 3mo ago

Their business model always seemed to be "become IBM, gods of the mainframe and server-side-computing" and that always seemed a bit unlikely to last forever considering how thoroughly the PC disrupted that by being "good enough" without the lock-in. IMO because they speed-ran it so much (raising orders of magnitudes more, pushing out new stuff orders of magnitudes faster) it will also lead to the rest of the world catching up faster and shrinking the pool of people internal to them who continually benefit compared to what actually went on with IBM. There's only so much upside when you join a company with hundreds-of-billions valuation. I guess the other part of their business plan bet was "become literal god of AGI". Maybe it'll still happen!

antonvs 3mo ago
> “become literal god of AGI” That only lasts until the AGI decides their god would be more useful if turned into paperclips.

hangonhn 3mo ago

Yeah I feel like China and their OSS model companies really did the world a great service by ensuring closed source US companies don't have an monopoly on LLMs and thus capture all the value of AI development and its impact on society. It's not going to be the foundational labs that will capture all the value -- I'm sure they will do just fine. A lot of it now will flow to the companies providing the inferences and since no one has any exclusive deals, those companies will have to compete and drive the price down, which ultimately benefits the rest of us.

techpression 3mo ago
It’s not a service, I hope nobody thinks this is being done ”for the good of humanity” or whatever. Doesn’t mean there’s not a benefit to people, but the financial politics behind it could turn out extremely good for China, and they are very well aware of just that.
- t-3 3mo ago
  Do American companies think about the "financial politics" of their decisions? I somehow really doubt it. Government takes sides and sometimes applies leverage to get companies to do what they want, but that's something separate from "it's a good business decision for Chinese labs to treat models as commodities". There's no need to think about geopolitics - American AI companies could easily take the same approach as the Chinese, but they all want to get exciting and huge VC cash rather than boring and less lucrative Compute-as-a-Service money.
  - techpression 3mo ago
    Chinese labs are equivalent to the Chinese state, there’s no separation. Who do you think funds the Chinese labs?
    - t-3 3mo ago
      American labs are also funded by the US government. Are they equivalent to the US state? Do Chinese and US labs/researchers exist solely in the international sphere, without any domestic concerns or individual aspirations? The Chinese have a different culture and political system than Americans, but it's not like they're ants without free will or the ability to think. I highly doubt that DeepSeek is operating solely at the behest of the CPC or that they are in business to take down the US rather than to make money.
    - Gud 3mo ago
      Before Trump 2.0, this was a decent argument.
- 3mo ago

4d4m 3mo ago

+1, and commodification was inevitable from the outset. This was the case before China. China hate is xenophobic and unproductive: produced both model improvements and desirable products people want at this moment in time. You use the best/cheapest model for the job/user input. Parallels to the US auto industry not paying attention to its buyers and the right strategies when they lost technical dominance to other countries a few decades back.