| > Wrappers rely on OpenAI. OpenAI relies on Microsoft. Microsoft needs NVIDIA. NVIDIA owns the chips that power it all So this is the model that investors see. The reality is quite different. People and orgs are not stupid and want to avoid vendor lock-in. So in reality: * Wrapper don't only rely on OpenAI. In fact, in order to be competitive, they have to avoid OpenAI because it's terribly expensive. If they can get away with other models, the savings can be enormous as some of these can be 10x cheaper. * Local models are a thing. You don't need proprietary models and API calls at all for certain uses. And these models get better and better each year. * Nvidia is still the dominant player and this won't change in the next years but AMD is really making huge progress here. I don't mention TPUs as they seem to be much Google-specific. * Microsoft is not in any special position here - I was implementing OpenAI API integrations with various API gateways and it's by no means something related to Azure only. * OpenAI's business model is based on faith at this moment. This was debated ad nauseam so it makes no sense to repeat all arguments here but the fact is that they used to be the only one game in town, then the leader, and now are neither, but still claim to be. |
They are getting better so fast that I'm considering building a business that depends on much lower cost LLM inference. So betting years of effort on it.
But the bet is also that the proprietary models won't run away with faster improvements that make local models uncompetitive even while they improve. Can the local models keep up? They seem to be closing the gap now. Is that the rule or an artifact of the early development phase?
The safer plan may be to pass the inference cost through to the user and let them pick premium or budget models according to their need almost per request, as Zed editor does now.