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The American attitude is generally to let private companies build up a new industry so it can create jobs and pay taxes. However, in the LLM race, the Chinese o
by MangoCoffee 2mo ago
The American attitude is generally to let private companies build up a new industry so it can create jobs and pay taxes. However, in the LLM race, the Chinese open weight playbook pretty much killed that. China has basically commoditized LLMs. Chinese models are good enough, so the race has come down to who can offer the cheapest tokens.
- deleted 2mo ago[deleted]
- andsoitis 2mo ago> China has basically commoditized LLMs What do you mean by "basically"? Why are Anthropic's and OpenAI's annualized revenue about $50B each? LLMs need massive amounts of compute to compete, so I wouldn't claim that the great (and leading, and likely to continue to lead) LLMs are commodities end-to-end, even if the non-executing-at-scale LLMs files and IP are commoditized. The execute, the compute, that is what breathes life into the model, which is otherwise weak or dead.
- purplemoonx 2mo agoOpenAI's annual profit is $0,000,000,000,000
- solenoid0937 2mo agoExpecting profit during hypergrowth is silly
- purplemoonx 2mo ago[flagged]
- stymaar 2mo agoOpenAI's hypergrowth year was 2023, they have steadily been losing market share over the past year while taking record losses.
- stymaar 2mo ago> Why are Anthropic's and OpenAI's annualized revenue about $50B each? I too can have $50B revenues by selling dollars for 50 cents each, and in the process I'll make a smaller loss than they do.
- boc 2mo agoChinese open weight models are great for this turn, but American private models generate orders of magnitude more cashflow. This cashflow = investment in training future models. It's unclear how Chinese open weight companies are going to compete in future rounds if they can't raise the same capital for training runs. The American business model is exceedingly efficient at building large businesses from zero. I wouldn't dismiss it as just a jobs creation thing.
- dgellow 2mo agoIt’s unclear where American labs future capital will come from. They pretty much exhausted private options at that point and it’s not clear how successful an ipo would be at the current time
- ericmay 2mo ago> It’s unclear where American labs future capital will come from. It’s unclear to you, perhaps? But they’ll raise funds and/or debt as needed in the US capital markets as they have been doing. > They pretty much exhausted private options at that point I don’t think this is true. The evidence is that they keep raising funding for build. > it’s not clear how successful an ipo would be at the current time It’s always unclear, but also IPO success doesn’t necessarily translate into long term business success.
- dgellow 2mo agoObviously to me, I express things from my point of view. Raising too much from debt is a bit dangerous if you plan to go public relatively soon and don’t have a good story for it (I don’t believe they have one). You can continue raising from VCs, but at some point the valuation and dilution starts to become a real issue, and will make your ipo even more difficult. Their options are pretty much limited to raising money from hyperscalers (with required compute spending, so more circular funding), which is what they are doing, but you cannot do that infinitely without having a good story to tell Microsoft/Google/Amazon investors. The market is more skeptical than it was a few months ago, I’m not convinced you can do that for years to come