Title is a bit of an exaggeration but the question is more: if the frontier models are so good, why even sell them as your primary money maker?
Couldn't OpenAI or Anthropic make a lot more money by just starting companies themselves that leverage the models and building their own products?
Is selling tokens really the best strategy?
Especially with commodification and prices declining wouldn't that indicate there is more money to be made on the application-side of the models rather than the utility side
2. Selling tokens via long running agents is the only thing that's provably working with respect to revenue growth.
3. They need revenue yesterday. Increases in borrowing rates means access to capital isn't what it was in the 10s. Their runway is much shorter than you would imagine.
4. Some of the decision makers at these companies believe AI will exhibit Jevons Paradox and that any decrease in price will result in induced demand.
5. The frontier models are still subject to the limitations of AI. They're not good at everything. Better to have someone else learn that on their dime rather than yours.
reply