[overfeed]

> This still feels like a step in the wrong direction, though, especially with OpenAI making so much progress with the efficiency of their models

Gemini also had modest increase before this - don't be surprised when OpenAI also has a "modest increase" with its next release. Cartel-like behaviour doesn't require direct communication when none of the participants are interested in participating in a margin-destroying price-war. All one needs to do is raise their price and watch how the competition react.

Such a scheme (and resulting high margins) would be imperilled by the existence of frontier open-weight models in the market, which may be why the reaction to Chinese models may be particularly shrill.

[simianwords]

>Don't be surprised when OpenAI also has a "modest increase" with its next releases; cartel-like behaviour doesn't require overt coordination when none of the participants are interested in participating in a margin-destroying price-war.

No I will be surprised and I'll bet on the fact that prices will keep going down, just like it went ~50% down in the latest GPT 5.6 release.

[falkensmaize]

If the price keeps going down, how are they ever going to be able to make back all the money they’re spending? If the price stays high, how are they going to undercut the cost of labor?

[simianwords]

Margins?

[PunchyHamster]

But they also blew the cost of hardware up.

Profitability at 2024 prices would be easy, not at current ones

[simianwords]

Hardware went up by 2-5x. Efficiency 100x.