This is not a lot competition though. And you need to assume, that like other industries, mergers and acquisitions will happen over time which will put you in an increasingly worse position.
A tri-opoly can still provide competitive pressure. The Chinese models aren’t terrible either. Kimi K2.5 is pretty capable, although noticeably behind Claude Opus. But its existence still helps. The existence of a better product doesn’t require you to purchase it at any price.
I mean it's kind of hard to say because almost all software I use is free, a lot of it is FOSS. The software I bought outright in the last couple of years was well priced because of competition (ex: Affinity Designer 2 for $63 - the new version is free although I stick with v2).
Maybe not worth using then. Your product costs 5x and delivers 0.2x of competing product in the adjacent product class (traditional server/VPS), why use it?
All the big clouds are still in market share acquisition mode. Give it about 5 more years, when they're all in market consolidation and extraction mode.
From whom? OpenAI and Google? Who else has the sort of resources to train and run SOTA models at scale?
You just reduced the supply of engineers from millions to just three. If you think it was expensive before ...
> Who else has the sort of resources to train and run SOTA models at scale?
Google, OpenAI, Anthropic, Meta, Amazon, Reka AI, Alibaba (Qwen), 01 AI, Cohere, DeepSeek, Nvidia, Mistral, NexusFlow, Z.ai (GLM), xAI, Ai2, Princeton, Tencent, MiniMax, Moonshot (Kimi) and I've certainly missed some.
All of those organizations have trained what I'd class as a GPT-4+ level model.
> Google, OpenAI, Anthropic, Meta, Amazon, Reka AI, Alibaba (Qwen), 01 AI, Cohere, DeepSeek, Nvidia, Mistral, NexusFlow, Z.ai (GLM), xAI, Ai2, Princeton, Tencent, MiniMax, Moonshot (Kimi) and I've certainly missed some.
This is not a lot competition though. And you need to assume, that like other industries, mergers and acquisitions will happen over time which will put you in an increasingly worse position.
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Kimi 2.5 is an opensource model with many providers https://openrouter.ai/moonshotai/kimi-k2.5/providers
Sure, opus and codex are significantly better. But price wise they cannot deviate too much from open models.
Especially if the open models are grounded against the digital twin.
Ah but I said "_... and running at scale_"
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A tri-opoly can still provide competitive pressure. The Chinese models aren’t terrible either. Kimi K2.5 is pretty capable, although noticeably behind Claude Opus. But its existence still helps. The existence of a better product doesn’t require you to purchase it at any price.
> The existence of a better product doesn’t require you to purchase it at any price
It does if it means someone using a better model can outpace you. Not spending as much as you can means you don't have a business anymore.
It's all meaningless, ultimately. You're not building anything for anyone if no one has a job.
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Have they stopped making a loss yet? They'll all need to raise prices or they'll all go out of business, and now it's a game of chicken.
Competition doesn’t magically waive costs, the investors expectations of return, neither debt serving obligations.
And how has that worked out for us in any other software category?
I mean it's kind of hard to say because almost all software I use is free, a lot of it is FOSS. The software I bought outright in the last couple of years was well priced because of competition (ex: Affinity Designer 2 for $63 - the new version is free although I stick with v2).
that worked real well for cloud computing
aws and gcp's margins are legendarily poor
oh, wait
gcp was net negative until last year.
Big part of why clouds are expensive is not necessary hardware, but all software infra and complexity of all services.
Maybe not worth using then. Your product costs 5x and delivers 0.2x of competing product in the adjacent product class (traditional server/VPS), why use it?
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All the big clouds are still in market share acquisition mode. Give it about 5 more years, when they're all in market consolidation and extraction mode.
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