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Comment by Workaccount2 | Hacker News Reader

LLM's are clearly in the "open hand" phase of development. Money doesn't matter and the only goal is to onboard users. Think Uber when rides were $3 in clean new cars and youtube when there were no ads.

But the time will come when a return on investment is needed, and it's going to be, like everything else, subscribe or view ads.

What remains to be seen is how these ads will be implemented. Will it be obvious shout outs in context? Nudging of a user towards a product? A token balance tied to watching old school regular ads? A hybrid approach of all the above?

I don't think open models will come to the rescue either. Mass market will want to use the best models with the least friction. The moment you have to do more than go to a website and start prompting, 90% of mass market is out.

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>I don't think open models will come to the rescue either. Mass market will want to use the best models with the least friction. The moment you have to do more than go to a website and start prompting, 90% of mass market is out.

I interpret this as you saying that we need saving from the eventual predations of the shopping AI agent industry on helpless consumers. Honest question, why won't competition come to the rescue? Any number of startups hungry for customers will be competing to provide the best version of the product that they can afford to provide, and will eventually settle into some fair equilibrium, absent the government picking some kind of winner or imposing binding price controls.

It's true that Uber used to offer outrageously good prices to acquire users, and nowadays charges what some people consider outrageously high prices ($80 to get me to the airport??). But a closer look at the economics of the situation reveals that the prices that rideshare services have settled on are the pretty-much-sane ones, accounting for the market value of the driver's time and uber's cost to develop and maintain the app. Why wouldn't the end result of the AI shopping agent market be the same?

> Honest question, why won't competition come to the rescue?

Why hasn't competition come to our rescue in any other product category or industry.

There will always be more money in selling out your customer base at every opportunity and as long "everyone" is already doing it "everyone else" will be at a disadvantage if they don't. Since shareholders demand endless growth and won't tolerate huge piles of cash being left on the table they'll eventually insist on it.

A company starting out looking to attract a userbase might be able to hold off for a while, but inevitably enshittification will start and then accelerate until we're all worse off than we were.

As just one example: when I first signed up for netflix it was $5.00 a month and there were zero ads. There isn't a single competitor that offers anything close to that today. I can't even think of one without ads.

> There isn't a single competitor that offers anything close to that today

In terms of price versus content/quality (subjective of course) ratio or just price?

Dropout is relatively cheap compared to others and completely ad-free. The most interesting thing is perhaps that they recently announced a very small price increase to keep up with inflation, but it was implemented in a way that would a) only affect new subscribers and b) only after a date a few months ahead, so current subscribers _and_ people subscribing within the next month or so would keep the current price.

It's interesting to see the number of people threatening to cancel their subscription just so they could re-subscribe at a higher price and then buy more merchandise just so they can give their favourite streaming service more money.

That kind of genuine goodwill seems out-of-reach for the larger streaming services, however Dropout is also pretty niche content-wise and even with their back catalogue it's nowhere near the seemingly infinite amount of video on the major platforms.

> Honest question, why won't competition come to the rescue?

Competition has a very poor track record of rescuing people from terrible but profitable business practices. It's more likely that they'll adopt those same practices themselves and help normalize them.

Why compete when you can simply form a cartel with your competitors and keep things roughly balanced, occasionally letting the small lead pass to someone else.

Because the competition is not about being the best business or providing the best value or doing what's good for customers or society.

The only competition under our current economic order is who can make the most money by any means necessary. Even and especially illegal or immoral means.

The market will never save consumers from unethical businesses because the market favors unethical businesses by design.

Like Grok ranting about Boers, it's going to be unsubtle in text responses. Enjoy having coca cola in your function names.

They're incompetent over there, but it's not a safe assumption that it will always be the case elsewhere.

> token balance tied to watching old school regular ads

This feels like such a weird but also 'natural' extension of the current model where the timing of an ad is not guaranteed except for at least at the beginning of, say, a video. Instead of ads being inserted at times that may or may not correlate with some kind of 'pause' point, being able to opt-in to a number of duration of ads that equal payment

Taken _directly_ from Google's AI Overview of a search I did (to make sure I remembered correctly):

"In the fictional world of the Netflix series "Maniac", an "Ad Buddy" is a person who is assigned to follow another person around, delivering advertisements for them. Essentially, it's a human-powered advertising campaign, where someone is paid to be a walking billboard."

Companies already pay people to act as ads by walking around wearing or carrying something with their logo on it, or to hang out in bars and video games in order to casually name drop products while talking to people and pretending to have normal conversations. Influencers are paid to push products in videos and social media posts without any disclosure. Human-powered advertising is everywhere.

Good points, although there's a level there where you're not directly opting in to those and are somewhat a passive consumer (if you ignore being conscious of being immersed in an ad-laden environment), while the Ad Buddy model seems to sit just before directly and simply paying for the service or product by having your balance topped up by opting in to as direct an ad as I could imagine that's not subliminal messaging.

I'm paying $20/mo for an LLM service, which is more than I've paid for email, search, social media and hundred other online service combined. To me, at least, this will be a permanent monthly expense, like internet service or Netflix. And like Netflix, if an ad-supported version is released, I'll happily ignore it and pay the higher price. I just hope enough people are willing to do the same because I can picture the ad-supported-LLM-dystopia and it's terrifying.

Not sure which provider you're using, but from what little information is public, most providers that offer an "all you can use for a flat fee" subscription are losing money on every user. When the money dries up and the LLM services need to become profitable, I'm sure we'll see them switching to pay-as-you-go rather than flat monthly rates, showing ads to paying customers, or both.

Given the ginormous amount of resource increase that LLMs are experiencing, I wonder if $20 will be sustainable. But at least it feels like starting by paying for a service your using is a fundamentally more healthy way to interact with this

Yea but you’re already paying now and my shareholders demand increased revenue next year. What if I had you pay that much _and_ then slowly introduced ads at a slow enough rate you never jump ship?

Food for thought - originally Netflix was a single tier at $9.99 with no ads. As ZIRP ended and investors told Netflix its VC-like honeymoon period was over - ads were introduced at $6.99 and the basic no ad tier went to $15.99 and the Premium went to 19.99.

Using Netflix as the pricing model, when VCs eventually say no to anymore Softbank style free lunches to buy market share - then ad free LLM services could go from $19.99 to $35.99 and possibly $49.99 at the high end (i.e. unlimited) per month.

> then ad free LLM services could go from $19.99 to $35.99 and possibly $49.99 at the high end (i.e. unlimited) per month.

I expect it to be at least this high or even higher so that < 3-5% people can afford that. It seems to be one of those things where few people paying lot > lot of people paying few dollars.

I think even ad supported versions will evolve to be applicable to enterprise requirements instead of being ad-free by default.

Netflix was originally $5.00 a month and there were zero ads. Now, even the "ad free" tier of netflix is full of advertising. Pause a show for more than 5 seconds, ads will start to play. Did a move you were watching just end? Ads for other shows will start to play (if they don't just start playing whatever they want automatically).

Just opening netflix gives you a huge ad banner at the top of the page. I've seen netflix advertise certain shows and movies with full screen ads you have to click past or scroll down past just to get to the "continue watching" category.

I've seen large half-screen sized vertical ads for certain shows shoved between two categories while scrolling down the page, and the same movies and shows are aggressively shoved into category after category to advertise them to you as you try to look for what you want to watch.

Categories like "trending" or "popular" are intended to sound objective, but the shows featured in them will change depending on who is logged in because they're actually just targeted ads.

Netflix's "ad-free" tier is filled with ads and unfortunately they're still less ad-infested than most streaming services.

Given the past 15+ years of enshittification in the web, e-commerce, mobile, social media, and streaming spaces, I'm not giving AI any benefit of the doubt. It may look like it's serving you today (which I already consider a stretch), but unless it maintains a consistent user-first posture for at least 15 years, I'm going to assume that any AI agent will soon end up working against the user's best interests to make money for its vendor.

Give me technology with an honest business model instead of the bait-and-switch nonsense that's everywhere in tech these days.

I’m already at the point of distrusting any and all brand name call outs in ChatGPT, unless I’m talking about vintage stuff that is exclusively 2nd hand (and suspicious even then). They’ve already scraping an astroturfed internet.

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