What shareholders, Anthropic is a money burning pit. Not to the same extent as OpenAI, but both will struggle hard to actually turn a profit some day, let alone make back the massive investments they've received.
Not that they don't bring value, I'm just not convinced they'll be able to sell their products in a sticky enough way to make up the prices they'll have to extract to make up for the absurd costs.
>> both will struggle hard to actually turn a profit some day, let alone make back the massive investments they've received.
I'd agree with you, except I've heard this argument before. Amazon, Google, Facebook all burned lots of cash, and folks were convinced they would fail.
On the other hand plenty burned cash and did fail. So could go either way.
I expect, once the market consolidates to 2 big engines, they'll make bonkers money. There will be winners and losers. But I can't tell you which is which yet.
I’m not sure there will be consolidation. There’s too much room for specialization and even when the models are trained to do the same task they have very different qualities and their own strengths and weaknesses. You can’t just swap one for the other. If anything, as hardware improves I’d expect even more models and providers to become available. There’s already an ocean of fine tuned and merged models.
$20B ARR or so reported added in Q1 doesn’t sound particularly bad, they’ll raise effective prices some more while Claude diffuses into the economy, sounds like a money printer. The issue is they’re compute constrained on the supply side to grow faster…
> $20B ARR or so reported added in Q1 doesn’t sound particularly bad
Unless you compare with the reported cash burn or projected losses.
> they’ll raise effective prices some more while Claude diffuses into the economy, sounds like a money printer
But the problem is, they have no moat. Even if Claude diffuses into the economy (still to be seen how much it can effectively penetrate sectors other than engineering, spam, marketing/communications), there is no moat, all providers are interchangeable. If Antrhopic raise the prices too much, switch out to the OpenAI equivalent products.
What shareholders, Anthropic is a money burning pit. Not to the same extent as OpenAI, but both will struggle hard to actually turn a profit some day, let alone make back the massive investments they've received.
Not that they don't bring value, I'm just not convinced they'll be able to sell their products in a sticky enough way to make up the prices they'll have to extract to make up for the absurd costs.
>> both will struggle hard to actually turn a profit some day, let alone make back the massive investments they've received.
I'd agree with you, except I've heard this argument before. Amazon, Google, Facebook all burned lots of cash, and folks were convinced they would fail.
On the other hand plenty burned cash and did fail. So could go either way.
I expect, once the market consolidates to 2 big engines, they'll make bonkers money. There will be winners and losers. But I can't tell you which is which yet.
I’m not sure there will be consolidation. There’s too much room for specialization and even when the models are trained to do the same task they have very different qualities and their own strengths and weaknesses. You can’t just swap one for the other. If anything, as hardware improves I’d expect even more models and providers to become available. There’s already an ocean of fine tuned and merged models.
$20B ARR or so reported added in Q1 doesn’t sound particularly bad, they’ll raise effective prices some more while Claude diffuses into the economy, sounds like a money printer. The issue is they’re compute constrained on the supply side to grow faster…
> $20B ARR or so reported added in Q1 doesn’t sound particularly bad
Unless you compare with the reported cash burn or projected losses.
> they’ll raise effective prices some more while Claude diffuses into the economy, sounds like a money printer
But the problem is, they have no moat. Even if Claude diffuses into the economy (still to be seen how much it can effectively penetrate sectors other than engineering, spam, marketing/communications), there is no moat, all providers are interchangeable. If Antrhopic raise the prices too much, switch out to the OpenAI equivalent products.
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