If you give me $500B to train the best model in the world, and then a couple people at a hedge fund in China can use my API to train a model that’s almost equal for a tiny fraction of what I paid, then it appears to be outrageously foolish to build new frontier models.
The only financial move that makes sense is to wait for someone else to burn hundreds of billions building a better model, and then clone it. OpenAI primarily exists to do one of the most foolish things you can possibly do with money. Seems like a really bad deal for investors.
In fact, I’d argue this is even worse, because no matter how much OpenAI improves their product, and Altman is prancing around claiming to need $7Trillion to improve their product, someone else can replicate it for a few million.
First-mover advantage doesn't always have to pay off in the marketplace. FedEx probably has to schedule extra flights between SF and DC just to haul all of OpenAI's patent applications.
I suspect that it's going to end up like the early days of radio, when everybody had to license dozens of key patents from RCA ( https://reason.com/2020/08/05/how-the-government-created-rca... ). For the same reason, Microsoft is reputed to make more money from Android licenses than Google does.
OpenAi spent investor money to enable random Chinese Ai startups to offer a better version of their own product at a fraction of the cost. In some ways, this was inevitable to be the conclusion, but I do find the way we arrive at this conclusion to be particularly enjoyable to watch playout.
Is it our job as a thinking public to decry it? Also sure. In fact, wildly yes.
I think it's more accurate to say most people can't (and don't) care about big monetary figures.
As far as Joe Average is concerned, ChatGPT cost $OoomphaDuuumpha and Deepseek cost $RuuunphaBuuunpha. The only thing Joe Average will care is the bill he gets after using it himself.