This is all a familiar pattern. In the early days of ride share it was an amazing advancement and very cheap, because it was highly subsidized. The quality was decent, and certainly better than taxi and car services in most cities. Tons of ride share app companies popped up.

Then reality set in. Costs were raised so they weren’t losing money anymore. Rideshare became more of a commodity and competitors got squeezed out as there wasn’t much room to compete and make money. Service quality went downhill. Uber is generally reliable but the quality has fallen off a cliff. My last car smelled bad and the rear axel sounded like was about to fall off the car. In most cities at the airport I just walk outside and get an old fashioned taxi at the rank vs dealing with all the nonsense regulations forcing one to walking to some remote corner of a parking garage for the “ride share pickup” zone.

GenAI is entering that pivot point. The products have plateaued. There’s pressure to stop the loss leaders and set prices to a more realistic level. Services are becoming commoditized. It’s not going away but we’re entering a period of rapid consolidation. GenAI will still be here in a few years and will be useful, but like rideshare the allure will wear old and we’ll look at these things like we do spell checkers today. Something everyone uses but ultimately boring commoditized tech where there’s not a lot of money to be made. A useful feature to add to actual products.

I do think there’s some good opportunity to shift to locally run small models, but that too will just become commoditized spell-checker level tech.