[coherentpony]

Uber’s situation was different, though. The reason Uber were bleeding money is because they purposefully made all their rides cheap to undercut the taxi businesses. People used Uber because it was cheaper than renting a taxi.

Now you can’t really find taxis anywhere, even at airports it’s a lot more difficult than it used to be.

Once the taxi business was disrupted enough, Uber’s pricing skyrocketed and customers had basically no other options for competition on pricing.

OpenAI basically created a new market. There is no AI chatbot incumbent to disrupt and swallow.

[madars]

Uber/Lyft takeover had little to do with price (though, yes, they were cheaper) and everything to do with reliability and overall quality of service. Even though ride sharing industry lost money in subsidy arms race and side bets it was fundamentally sound in major metros since early on (similar to how Amazon was fundamentally sound from early on, despite not recognizing profit for a long time). Popular "analyses" kept equating Uber/Lyft with firms losing money on every sale with no path to fix it but the demand was always there as riders had already left taxis and transit on reliability and convenience grounds.

[pastel8739]

People use AI because it is cheaper than paying humans to think. Soon you won’t really be able to find human thinkers.

[tartoran]

Some humans will need to interpret the thinking and apply it somewhere and take some responsibility for those decisions. If you think AI can do all that end to end it’s a different question but we’re nowhere near that right now.

[pastel8739]

Definitely, I’m not saying that AI can entirely replace humans. But AI is definitely replacing parts of many jobs. If AI companies raise their rates to be profitable, and it turns out that paying for profitable AI is not worth it vs paying for humans, that might be a sticky situation.

[ThunderSizzle]

There will always be a competitor that can undercut the inference market. There is no "moat" given that you can self host decently capable LLM agents like Qwen3.6 on not super expensive hardware, like an AMD R9700, and still get competitive speeds to most cloud interfaces.

If you can self host it that easily, any Joe can scale it out much like shared web hosting, and shared web hosting or even dedicated rented boxes has always been cheaper than the big cloud providers.

I don't think OpenAI or Anthropic can reasonable compete in the long term if they can't achieve "AGI", and they won't, no matter what shareholders desire.

[morpheos137]

Actually the point is total cost wise outside of subsidy it is not cheaper than humans. the bigger problem is as the parent said open AI created a market. It is selling a commodity service with investor funds. There is no moat. your second sentence soon you won't be able to find human thinkers is on its face absurd, assuming the human race continues. Thinking is the human ecological niche.

[grebc]

Thinking doesn’t disappear because of OpenAI’s shitty LLM’s.

It certainly disappear for their customers however.

[kennywinker]

The hot-take that humans are going to stop thinking because of AI is the only convincing evidence of the idea i’ve come across so far.

[fny]

They aim to undercut labor.

For now, businesses are getting addicted to cheap tokens. As the screws get turned, business will debate whether they should spend budget on humans or tokens. What's further devastating is that humans are also becoming addicted to cheap tokens. Much human output is nowadays a token slopfest. People are becoming dumber too. So the real business question will be spending budget on token monkeys or tokens.

[Dylan16807]

> They aim to undercut labor.

Which doesn't work the same way at all. With taxis, making them unprofitable leads to a long-lasting lack of taxis. When lots of jobs are lost, it actually becomes easier to hire someone with the right experience.

[eloisius]

It might work very much the same. Discourage a cohort of CS grads into following another career path. Give businesses enough time to fully commit to “agentic workflows” such that they don’t have the expertise for in-house engineering anymore. Completely spaghettify every code base such that only AI would be willing and able to implement new features in it. Let customers lower their expectations of quality to meet what AI can product. By the time they crank up the token price, it may be hard or impossible for businesses just to switch back to human engineers.

[adrianN]

It depends on how long you can keep those people un- or underemployed. I think engineers are rapidly bleeding experience even while being employed if all they do is prompting.

[coldtea]

Supply-wise yes.

But when lots of jobs are lost, consumer spending is lost, and it becomes harder to sustain a business (whether B2C or B2B) and afford to hire someone...

[iwontberude]

If you knew about how much man power it takes to maintain, evaluate and improve agentic workflows, I don’t think you would write such a thing. In this context, AI is a jobs program for permanent employment.

[Gigachad]

You still can get taxis, at least in Australia. And they hound you at the front of the airport.

They just consistently cost more and have worse service even after uber increased prices.

[shoobiedoo]

Japan too. never thought I'd see it here but a taxi driver took the long way after a work drinking party. I guess he thought we were too drunk to notice. Well my boss sure did and lost his mind at the guy.

[femto]

Likely the continued existence of taxis are keeping Uber's prices in check in the Australian market.

Uber will be running an optimisation model and be charging the maximum market can sustain, with additional goals such as eliminating competition and not being shut down by regulators.

[alexpotato]

My family and I have gone back to using car services for rides to the airport b/c "Uber XL" seems to include a WIDE variety of vehicles in terms of size and cleanliness.

A car service is about the same cost, the car looks brand new and clean and the driver is helpful.

[DANmode]

What’s the price multiplier?

[structural]

Uber's situation is exactly the same. OpenAI is offering inference for a bunch of industries at prices that make it more competitive than hiring humans to do the same work.

If the break-even price to actually provide the service wasn't actually economic compared to humans, would there be nearly as much of a market? That's the real question. OpenAI is basically betting that they can live long enough that AI systems get built around them, which creates enough of a lock-in that they still have customers when prices increase by a lot.

[wbl]

I think you underestimate the price by a few orders of magnitude where it makes sense to pay a model instead of a human. If someone earning 200,000 a year gets replaced by paying 500 a day to Anthropic or OpenAI their employer comes out ahead.

[structural]

There's likely always going to be value in limiting the number of $200k+ SWEs you have to pay. But that's not the interesting case.

What about the $10k/year offshored employees that are getting replaced by AI call centers? If that were the break even, then once you close down the whole building and develop the systems to not need them, then how much would inference costs have to go up before all that gets unwound and handed back to humans? It's more than you think - there's real margin there.

[asdff]

The uber situation was even more insidious than that. It wasn't like college students were calling cabs to go to bars in 2013. Uber created a market. It was essentially a mind virus. Gee now I can go to this place all for $7. Chum the water, establish the new pattern of living that people won't ever back away from, then twist the knife and raise prices knowing they won't revert back to whatever Old Way now long forgotten or not even engaged with by the upcoming generation.

Many such cases.

[dfee]

> It wasn't like college students were calling cabs to go to bars in 2013.

well, in 2009, we did.

[a3f8c2d]

The AI chatbot incumbent is the swath of human professionals, no?

[esafak]

But there are competitors. The race is to corner the market.