[aurareturn]

I think the point here is that it takes the same hardware to inference an open source model as OpenAI/Anthropic inference their models.

IE, a lower param OpenAI/Anthropic model can compete with a higher param open source model.

So even if you are an American company who downloaded Chinese models in hopes of saving in cost, you still have to beat OpenAI and Anthropic in $/task which is very tough to do over the long run.

[Gigachad]

The problem is these AI companies are running at a loss with the hopes of pumping the prices after everyone is hooked. Now they are locked in at selling API access at rock bottom price. The valuations won't hold.

[elictronic]

It’s even worse. There operating costs are rising because of their own demand claims while those same rock bottom api prices are locked in.

There being squeezed by their own stock pumping and SpaceX pretending to be an AI company is driving down the exit strategy. I’m guessing one starts going full Theranos and begins claiming full AGI or gets the US government to government cheese then hard. It’s going to be a few crazy months.

[pishpash]

No they don't. Are OpenAI and Anthropic charging at cost, or wish to? No.

[aurareturn]

If you have more efficient models, you can reduce price and grab market share or keep price and increase your margins.

Over time, this compounds. More profits means more investments. More market share means more control.