You may not be following OA for a while! They’ve never turned a profit. So, someone on the other side has to lose for them to stay afloat!
Now that OpenAI is starting to talk about ads and allowing "erotic" content, I feel more comfortable in my prediction that not only have OpenAI never turned a profit, they never will. They will be consumed by Microsoft or crash the market so hard it's not even funny. The technology will survive, and it will be useful, but OpenAI as a company is done.
Three generations of Twitter leadership couldn’t make ads on that platform profitable and that exposes far more useful user specific information than ChatGPT.
The hubris is incredible.
More and more OpenAI is drawing parallels to the Danish scandal of IT Factory. Self-proclaimed world leading innovation and technology in the front, financial sorcery in the back.
It's a giant money pit, funding a bunch of people who are not long off the crypto grift train if they are at all.
Like, where is this tech headed? Is it always going to be something that can only be run economically off shared hardware in a data center or is the day I can run a “near frontier model” on consumer grade hardware just around the corner? Is it always going to be trained and refined by massive centralized powers or will we someday soon be able to join a peer 2 peer training clan ran by denizens of 4chan?
This stuff is so overhyped and yet so under hyped at the same time. I can’t really wrap my head around it.
I suspect it is, in fact. But you can also see why a bunch of very very large, overinvested companies would have incentives to try to make sure it isn't. So it's going to be interesting.
perfectly stated, I had to play a lot with some models to get a better picture of how they work and their limitations, before that all the articles I read about them were either "LLMs are the greatest thing ever, totally perfect and made me a 100x engineer" or "LLMs are complete BS and don't provide any value"
I do think we can build great products on top of them, but the way they're being sold implies we'll need no more new product because a chat interface w/ some tool calling is all you'll ever need.
Your last statement: are you implying that the AI-bubble is perhaps an attempt at building out more cryptocurrency mining outfits?
But specifically at least one of these people — Sam Altman —- is not, IMO, off the crypto grift train, because he's still chairman of Worldcoin, which strikes me (and more importantly strikes regulators around the world [0]) as a pretty shoddy operation (not to mention creepy and weird).
[0] https://en.wikipedia.org/wiki/World_(blockchain)#Legal_and_r...
> There’s a famous Sam Altman interview from 2019 in which he explained OpenAI’s revenue model [1] :
>> The honest answer is we have no idea. We have never made any revenue. We have no current plans to make revenue. We have no idea how we may one day generate revenue. We have made a soft promise to investors that once we’ve built this sort of generally intelligent system, basically, we will ask it to figure out a way to generate an investment return for you. [audience laughter] It sounds like an episode of Silicon Valley, it really does, I get it. You can laugh, it’s all right. But it is what I actually believe is going to happen.
> It really is the greatest business plan in the history of capitalism: “We will create God and then ask it for money.” Perfect in its simplicity. As a connoisseur of financial shenanigans, I of course have my own hopes for what the artificial superintelligence will come up with. “I know what every stock price will be tomorrow, so let’s get to day-trading,” would be a good one. “I can tell people what stocks to buy, so let’s get to pump-and-dumping.” “I can destroy any company, so let’s get to short selling.” “I know what every corporate executive is thinking about, so let’s get to insider trading.” That sort of thing. As a matter of science fiction it seems pretty trivial for an omniscient superintelligence to find cool ways make money. “Charge retail customers $20 per month to access the superintelligence,” what, no, obviously that’s not the answer.
> On a pure science-fiction suspension-of-disbelief basis, this business plan is perfect and should not need any updating until they finish building the superintelligent AI. Paying one billion dollars for a 0.2% stake in whatever God comes up with is a good trade. But in the six years since announcing this perfect business plan, Sam Altman has learned [2] that it will cost at least a few trillion dollars to build the super-AI, and it turns out that the supply of science-fiction-suspension-of-disbelief capital is really quite large but not trillions of dollars.
> [1] At about 31:49 in the video. A bit later he approvingly cites the South Park “underpants gnome” meme.
> [2] Perhaps a better word is “decided.” I wrote the other day about Altman’s above-consensus capital spending plans: “'The deals have surprised some competitors who have far more modest projections of their computing costs,’ because he is better at this than they are. If you go around saying ‘I am going to build transformative AI efficiently,’ how transformative can it be? If you go around saying ‘I am going to need 1,000 new nuclear plants to build my product,’ everyone knows that it will be a big deal.”
There is much more manipulation potential with LLMs than typical ads. I am worried. It gets more and more difficult to distinct ads and the neutral information.
They should've made so much money on direct response and yet somehow they messed it all up.
Just like they should have been a few times as large in terms of users, but they executed really, really badly.
So I'm not sure Twitters failures imply anything about OpenAIs prospects.
A quick search seems to indicate that the porn industry has a $100B in revenue per year, 20% of which is from subscriptions. If OpenAI consumed the entire global market for subscriptions, $20B, would that cover their yearly operational cost?
Not sure if increased availability of LLM porn or the gradual erosion of LLMs with ads and sponsored content would be the greater evil on a societal level. Neither is particularly great. But they will certainly drive shareholder value
I'm curious what you're referring to here. Did Sam Altman tweet something about this?
So the math is probably harder than it seems.
The exception might be Azure with their LLM services.
There's a mechanism here similar to a Laffer Curve: Charge too much, they lose; charge too little, they lose. OAI needs to strike a delicate balance vs. surging low-cost competition.