The Rust Foundation was happy to announce OpenAI as our newest Platinum Member today, as part of a $600,000 total contribution in support of the Rust Project and the broader Rust ecosystem. Membership in the Rust Foundation is a way for companies to support the maintainers who are building the…
You’ve got it all backwards. In an ideal capitalist world, the greedy software nonprofit foundations bleed the innovative corporations of their well-earned revenue.
No, they are now charging by usage. They will either end up with boatloads of money while people still have ChatGPT integrated into their workflows, or they will end up with zero money as people either switch to other models or realize that AI was a shit idea all along.
Not the actual cost… they are still losing money even in their most expensive tiers. There is just no path to profitability with ANY of the current models, they simply cost more to run than the people they are supposedly trying to replace
Also business customers are fleeing in droves because they’re forcing API only pricing for businesses and everyone is getting sticker shock at the costs.
FWIW the general consensus is that they are just about making a profit on selling it by the token (as opposed to the subscriptions which are massively subsidised) so long as you pretend that capital expenses and R&D aren’t real and at some point they could stop doing them in order to make profit.
That is very much not a given, with all the labs in a death march to not let the others get better than them and take their lunch, and open source only 9-18 months behind the closed models.
FWIW the general consensus is that they are just about making a profit
This is what the tech bros claim (which is obviously convenient so they can lure more suckers investors in); every outside pundit concludes otherwise
Check this article I received yesterday… in a nutshell, if a company returns less than 7% on investment, they would normally be liquidated by investors. To make it to 7%, AI companies would have to reach a revenue of $2 TRILLION per year (cumulative amongst the big AI players, which are like 5 total)
Last leaked financials from OpenAI showed $13 Billion revenue and a $21 billion loss
Yes, judging them now the big AI companies are terrible businesses, they are just about, maybe, marginally profitable if they stop the huge fixed expenses which they cant stop because of their environment.
The gamble is that AI will increase in usage, while becoming more efficient and resisting becoming commoditised. I don’t think there’s a strong chance of all three of those happening, but if they did that would justify them losing money now in order to make big profits later. That’s the gamble.
The gamble is that AI will increase in usage, while becoming more efficient and resisting becoming commoditised.
But again we already know that is impossible since the economies of scale do not work. Each extra user means a shit ton of extra processing in those Data Centers and, even disregarding the destruction of the planet, nobody will pay that cost just to get 35% hallucinations in their queries.
Right now, they are literally gambling with the IPOs that they hype will last long enough for them to cash out and let pension plans and other large automated index investors holding the bag.
OpenAI is the one who needs donations
You’ve got it all backwards. In an ideal capitalist world, the greedy software nonprofit foundations bleed the innovative corporations of their well-earned revenue.
No, they are now charging by usage. They will either end up with boatloads of money while people still have ChatGPT integrated into their workflows, or they will end up with zero money as people either switch to other models or realize that AI was a shit idea all along.
Not the actual cost… they are still losing money even in their most expensive tiers. There is just no path to profitability with ANY of the current models, they simply cost more to run than the people they are supposedly trying to replace
Right, which is “AI was shit all along” branch.
Also business customers are fleeing in droves because they’re forcing API only pricing for businesses and everyone is getting sticker shock at the costs.
FWIW the general consensus is that they are just about making a profit on selling it by the token (as opposed to the subscriptions which are massively subsidised) so long as you pretend that capital expenses and R&D aren’t real and at some point they could stop doing them in order to make profit.
That is very much not a given, with all the labs in a death march to not let the others get better than them and take their lunch, and open source only 9-18 months behind the closed models.
This is what the tech bros claim (which is obviously convenient so they can lure more
suckersinvestors in); every outside pundit concludes otherwiseCheck this article I received yesterday… in a nutshell, if a company returns less than 7% on investment, they would normally be liquidated by investors. To make it to 7%, AI companies would have to reach a revenue of $2 TRILLION per year (cumulative amongst the big AI players, which are like 5 total)
Last leaked financials from OpenAI showed $13 Billion revenue and a $21 billion loss
Your link is broken.
Yes, judging them now the big AI companies are terrible businesses, they are just about, maybe, marginally profitable if they stop the huge fixed expenses which they cant stop because of their environment.
The gamble is that AI will increase in usage, while becoming more efficient and resisting becoming commoditised. I don’t think there’s a strong chance of all three of those happening, but if they did that would justify them losing money now in order to make big profits later. That’s the gamble.
Sorry about that, here is another https://archive.ph/3V0oc
But again we already know that is impossible since the economies of scale do not work. Each extra user means a shit ton of extra processing in those Data Centers and, even disregarding the destruction of the planet, nobody will pay that cost just to get 35% hallucinations in their queries.
Right now, they are literally gambling with the IPOs that they hype will last long enough for them to cash out and let pension plans and other large automated index investors holding the bag.
This Xmas may not be merry at all…
Wdym, they get donations all the time
They are bleeding money