Comment by sofixa
14 hours ago
> $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.
> But the problem is, they have no moat
I disagree very strongly with this, both anecdotally and in the data - subscriptions are growing in all frontier providers; anecdata is right here in HN when you look around almost everyone is talking about CC, codex is a distant second, and completely anecdotally I personally strictly prefer GPT 5.3+ models for backend work and Opus for frontend; Gemini reviews everything that touches concurrency or SQL and finds issues the other models miss.
My general opinion is that models cannot be replaceable, because a model which can replace every other provider must excel at everything all specialist models excel at and that is impossible to serve at scale economically. IOW everyone will have at least two subscriptions to different frontier labs and more likely three.
You're actually reinforcing my point. Models are interchangable and easy to switch between to adjust based on needs and costs. That means that no individual model / model provider has any sort of serious moat.
If tomorrow Kimi release a model better at something, you'd switch to it.
It's likely that Chinese models will get regulatory knee-capped at some point, and the domestic labs all have pretty common costs they need to make up. This creates an environment where they match each other as prices climb. Unless Google/Meta suffocates the startups since they have actual cash flow that is non-AI.
Sure you can go local, but lets be real, that would be <1% of users.
Yes, in that sense, technically correct.
I postulate in practice this won't matter since the space of use cases is so large if Kimi released the absolutely best model at everything they wouldn't be able to serve it (c.f. Mythos).