And once they've got their monopoly position there is inevitably the rug-pull. I wonder if some CPO somewhere actually had the guts to put a 'rug pull' item on the product roadmap.
Even traditional businesses do this with coupons. Is it unfair that Costco sells chickens for under cost because it drives usage to them?
Companies like Uber did use massive funding and price subsidization to try and kill competition and then take a monopoly, but it is hard to assert that this is what google is doing now. And given that other competitors in the space, Anthropic are doing the exact same thing again its not as though they are alone.
Also they could be subsidizing it because they want that usage type as it helps them train models better.
Chatgpt and gpt4 were all ran at a loss and subsidized people just didn't know that. Almost all of the llm companies have been selling 1 dollar of llm compute for 50 cents as they valued the usage, training data, and users more than making profit now.
This next generation of MOE and other newly trained models. Like opus 4.6, Cursor Composer 1.5, gpt 5.3 codex, and many of the others have been the first models where these companies are actually profitably serving the tokens at the api cost.
This year has been the switch where ai companies are actually thinking of becoming profitable instead of just focusing on research and development.
Not. On both counts.
But Google are banning entire accounts, with years, even decades, of personal history, photos, even phone accounts and app development projects.
They very easily could just negate the anti-gravity access, which would be much, much more reasonable.
Source? It seems to me only the anti-gravity access was blocked. The link says
> Our product engineering team has confirmed that your account was suspended from using our Antigravity service.
> there’s no way we can restore our accounts to use Antigravity anymore yeah?
Disclosure: I work at Google, but not on anything related to this.
> ”Thank you for your continued patience as we have thoroughly investigated your account access issue. Please be assured that we conducted a comprehensive investigation, exploring every possible avenue to restore your access.
> Our product engineering team has confirmed that your account was suspended from using our Antigravity service. This suspension affects your access to the Gemini CLI and any other service that uses the Cloud Code Private API.
> Our investigation specifically confirmed that the use of your credentials within the third-party tool “open claw” for testing purposes constitutes a violation of the Google Terms of Service [1]. This is due to the use of Antigravity servers to power a non-Antigravity product.
> I must be transparent and inform you that, in accordance with Google’s policy, this situation falls under a zero tolerance policy, and we are unable to reverse the suspension. I am truly sorry to share this difficult news with you.”
I totally read that (and the other posts in that forum) as a complete suspension of their whole Google Account (another person mentions their GCP access suspended).
But I could be reading it wrong and it's just their AI account (and any service that uses that... I'm not clear on where those boundaries are?)
Still not going to risk signing up for this, because I cannot risk my Google account getting suspended or banned for something I wasn't aware of in the ToS. No warnings is still drastic, even if it's just part of the account.
That sounds like the suspension only affects those things. Not e.g. gmail.
Offering a different discounted rate for a service, though their first-party platform is not an unfair business practice whatsoever, though. The bar isn't what you disagree with, or what you think their motives are without any substantial proof. They could even make a honest argument that they can aggressively key-value cache default prompts from their own software reducing inference costs.
>See also: Microsoft and a whole bunch of other companies.
What does that have to do with Google?
Although in this case it's probably impossible to define, given the complexity of calculating the true cost of tokens.
e.g. the CRTC has regulations around a la carte offerings since the past decade: https://crtc.gc.ca/eng/television/program/alacarte.htm
> TV service providers must offer channels both individually and in packages of up to 10 channels.
This isn’t even vaguely similar to illegal tying. The biggest problem being that the products almost certainly aren’t dissimilar enough to be considered “tied” at all.
In other countries, selling a $7 chicken if it's subsidized by the sale of other goods can indeed be illegal.
It seems like you havent thought this through at all.
No.
Dumping is an international-trade term. It doesn’t even require pricing below cost, just aiming “to increase market share in a foreign market by driving out competition and thereby create a monopoly situation where the exporter will be able to unilaterally dictate price and quality of the product” [1].
Loss leaders are common in commerce and entirely legal, as are free trials. I struggle to think of a competent jurisdiction that bans them.
Russian laws officially use the term "monopolistically low prices", and prohibit them if the entity engaging in such pricing holds a dominating presence in the market (and not necessarily for the goods that are being underpriced).
A correct term for the US is "predatory pricing", and it's also prohibited by the Sherman Act. For much the same reason, a large entity can destroy competition by accepting losses from selling goods below the cost. The border between loss leaders and predatory pricing is, as usual, very blurred.
Oooh! Do you have a recommendation for a translation of a Russian economics text? I’m particularly curious of Soviet-era texts that work on theory without prices.
> correct term for the US is "predatory pricing", and it's also prohibited by the Sherman Act
Sherman prohibits the “restraint of trade or commerce” [1]. The word “price” never appears in its text. In practice, predatory pricing is a tightly-regulated term that doesn’t generally prohibit selling goods below cost
[1] https://www.govinfo.gov/content/pkg/COMPS-3055/pdf/COMPS-305...
I don't think they exist? The Soviet Union used prices internally as an accounting tool. It essentially had two separate currencies: the actual physical currency that regular people owned and the virtual "accounting" currency. The accounting currency could not be converted into the real one, except for salary payments that were tightly regulated.
Once the USSR allowed some inter-conversion channels in the early 80-s its economy predictably got blown up as a result.
> Sherman prohibits the “restraint of trade or commerce” [1]. The word “price” never appears in its text. In practice, predatory pricing is a tightly-regulated term that doesn’t generally prohibit selling goods below cost
The Sherman Act is a framing law that establishes the authority to regulate monopolies, and it's on purpose rather vague in its wording.
A more concrete law here is the Robinson-Patman Act, which prohibits illegal price discrimination, including pricing substantially similar goods differently for different purchasers.
Arguably, yes.
Should Microsoft have not been allowed to sell operating systems and still survive from selling BASIC interpreters? Should Nintendo have not been allowed to sell video games and still be selling playing cards?
Every company that is interested in survival takes profits from an existing business to start a new one,
Toyota shouldn't have to sell their first new car off the line for 100 million to pay for the entire manufacturing line.
Your first SAAS customer shouldn't have to pay back all your costs.
Can you plan to break even after your first month of sales? first year? 10 years?
Amazon runs two sets of infrastructure “CDO” and “AWS”. It’s a myth that Amazon used excess capacity to start AWS. AWS was always built out as separate infrastructure outside of AWS.
Some Amazon services do run on AWS. But when Amazon runs workloads on AWS, for internal accounting, they are considered a customer.
Source: former employee at AWS
What about OpenAI?
Second, that’s not what dumping means. It’s a specific term for international trade.
Third, it’s not illegal to sell something for below the cost to make it. That’s another common misunderstanding.
Of course, Google is still in the wrong here for instantly nuking the account instead of just billing them for API usage instead (largely because an autoban or whatever easier, I'm sure).
I am afraid of using any Google services in experimental way from the fear that my whole Google existence will be banned.
I think blocking access temporarily with a warning would be much more suitable. Unblocking could be even conditioned on a request to pay for the abused tokens
Claude code could possibly make profit because the average usage doesn't come close to exhausting the limits.
Should Netflix for instance not invested money from renting DVDs to invest in a streaming service?
Apple not use the profits it was making from selling Apple //e’s to create the Mac?
Not sure that this case is either. This is just idiots breaking the TOS.
If it makes it impossible to set up a competitor? Absolutely, yes.
> Should Netflix for instance not invested money from renting DVDs to invest in a streaming service?
Netflix was not priced below the cost of production from the beginning. You're confusing sustainable pricing and paying off all the capital spending immediately at launch.
A better example is Doordash when it was heavily subsidized by VC money: https://news.ycombinator.com/item?id=23216852 And it now faces several anti-trust lawsuits.
Netflix borrowed $16 billion over a decades
https://www.nytimes.com/2021/01/19/business/netflix-earnings...
Because subscriptions didn’t make enough money to fund its business. Were they being “anti competitive”?
Probably a good idea. And it looks like Netflix simply needed to make the service a bit more expensive?
So how would that have helped smaller competitors? Where were they going to get the money from to compete if not other lines of businesses or borrowing? Were they going to charge their first 10,000 customers $100,000 a year so they could fund development without either borrowing money or take it from existing businesses?
> So how would that have helped smaller competitors? Where were they going to get the money from to compete if not other lines of businesses or borrowing?
By borrowing at market rates and pricing services to cover the loan payments.
You're actually making a good argument why cross-financing should not exist at all and that we all would probably be better without it.
And I can’t believe that this conversation just went to companies should borrow money instead of reinvesting its own profits. Really?