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by rektomatic 12 days ago
Maybe the whole windows/linux thing is an apt comparison? Linux is OS and arguably runs the internet yet windows is still a cash cow. The paid-for models are like windows, the OS models are like linux?
3 comments

But surely that's completely different, no? It seems that there are major differences between OSes and LLMs that preclude this comparison, in that an LLM is truly 'just' a tool. You can slot in another to replace it, IDEs and harnesses can handle basically any provider out the box, etc. An OS is not just a tool, its success depends on things like power management/general hardware interaction (requires collaboration with consumer computer manufacturers), what applications are available for it (dependent on third party devs), etc. It does seem that all the LLMs are substitute goods in a way that OSes are not at all.
Completely different levels of stickiness.

The OS runs everything; the LLM can be swapped in a second.

(But yes, you will have to tweak prompts+tuning anytime you change models)

Corporates aren't running Linux not because it's hard to switch. Corporates are sticking to MS because of compliance and admin costs.
Then it's hard to switch?

It's irrelevant the reason why, the margin any business can take will be constrained by the cost to switch to a cheaper, good enough, competitor.

You are saying it's difficult to switch due to compliance and admin issues. Ok!

LLMs can be swapped easily and open weight models can be hosted to adhere to whatever legal, uptime requirements etc are needed trivially.

The big cloud providers already host and resell open weight models.

The two don't event compare

But corps are running Linux, in that sense that basically every serious web application is running on a Linux backend. Even if you use IaaS.

Basically, companies that are "in the know" and develop software utilize linux as much as they reasonably can. Companies that aren't, don't, but do "use it" kind of transitively through their software.

Where Linux does not hold is in Corporate Desktop IT. Mostly because of inertia of all things. MBAs need their Excel, and let's be honest. These people just... do not learn new tools. They certainly have the ability, but the culture is such that they just don't. So it's not even a choice really. No Windows = No Excel = No serious business person is okay with this.

Maybe, maybe, if your company is mostly developers then you can swing desktop IT linux. But your IT department will fight you, yes they will. And HR will be pissed. And I sure hope your CEO is also a developer. If he's a business guy, well... boss baby needs his Excel. How's he gonna do anything without Excel.

Our dev arm (me included) do use Linux VDI. But most day-to-day business are done in Microsoft's ecosystem (Teams, SharePoint, Office, Copilot, etc). In the industry I am in, you would never be able to use any AI tools unless the trusted platforms offer them as part of their products (i.e. Microsoft's Copilot or Amazon's Bedrock) because InfoSec and Legal departments won't risk authorizing any other providers.
Using OS as an abbreviation for open-source and operating system in the same thread is hurting my brain.
Claude Design with Fable 5 is an absolute killer app that you’d have to pry from my cold dead hands.

I’m not an Anthropic fanboy - Codex has been my daily coding driver for the last year.

But my point is these companies are building app + model combos that are very sticky. Certainly not as much as an OS, but much more than the “there is no moat” crowd give them credit for.

When they can sell that for tens of Billions a year against competition, they might have a financial case.

In reality, there will be many clones of Claude Design, especially if it gains big revenue traction.

Doubly so if you believe the narrative that coding and apps will be "free" and instant to create in the future.

There are soooo many clones of Adobe Photoshop including clones that run right in your browser, and yet people continue to pay Adobe hundreds of dollars a month because there's like one tiny tweak that Photoshop has, or some small mouse gesture that the clone doesn't completely replicate.
I'm almost on board with what you're saying, except Photoshop had a two-decade advantage both in its technological advancement and in becoming the industry standard, including by infiltrating schools and being pirated by students who would become professionals. American AI companies don't have that gulf.
Linux was not for a long time on the same level of windows though