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Comment by usef-

1 month ago

The proverbial "50B" is investment in next year's model. The current model cost under "30B", and therefore "is profitable". It is a bet on scaling, yes, but that's been common throughout the industry (see, eg, Amazon not being profitable for many years but building infrastructure)

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usef-

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usef-  1 month ago

Also see the Dario interview with Dwarkesh:

> If every year we predict exactly what the demand is going to be, we’ll be profitable every year. Because spending 50% of your compute on research, roughly, plus a gross margin that’s higher than 50% and correct demand prediction leads to profit. That’s the profitable business model that I think is kind of there, but obscured by these building ahead and prediction errors.

(a lot more at the link)

https://www.dwarkesh.com/p/dario-amodei-2?open=false#%C2%A70...

ReptileMan  1 month ago

Except the rumors are they subsidize even the inference, not that they have capex in training.

  • nl  1 month ago

    The maths shows inference is very profitable. Look at how Google/AWS/Azure change the same rates as Anthropic does for running Claude models.