Comment by baridbelmedar
24 days ago
I'm not sure the "a year of document processing for under 100 USD/y" is such as great thing as you think it is (at least not for European competitiveness)... It means Mistral is essentially setting a revenue ceiling very low. OCR is a commodity at this point, and open source models, AWS, etc already do it out of the box.
Plus, you can't really build loyalty on a 100 USD/Y price tag. Since there are no switching costs holding them back, those buyers will leave the moment somebody offers a lower rate. An easily cloned, low cost tool with zero customer lock in is not a business. It is a feature.
That might sound great for the buyer (you), but it is a terrible strategy if we want a European company to compete long term against global competitors on actual product merit instead of just regulatory arbitrage.
well all commodities are like this. replace AI with milk, or plastic. It's easy for me to just move to different milk provider, this does not mean that milk industry is not a business.
And yes, its good that "its good for buyer" after all we do business so that living would be nicer, not the other way around (live to do business)
It does mean that the milk industry is a low value add commodity business where suppliers compete primarily on price and only survive due to protectionism and subsidies.
Food is important for national security so we should subsidize it, but it's a cost center. It'll never drive growth.
If that's what Mistral is aiming for, it would probably be better to give up now.
In some sense all commodities are "important for national security". Generic drugs are important for national security. Computer technology is important for national security. Im not sure what we arguing about. Im saying that AI is good thing to have like other commodity and it should net be one provider worth gazillion money.
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> If that's what Mistral is aiming for, it would probably be better to give up now.
If Mistral is aiming not to grow to infinity but instead to offer niche models at reasonable prices, should they give up now? I think I'm not sure what exactly you're saying.
How we got from competition to assuming subsidies is beyond me.
There are a whole lot of commodity businesses that flourishes and that are profitable. It's true, that, yes, they will not have huge margins.
Grocery stores are like that - some of their suppliers might be subsidised but they are not, and many places they operate with typical margins in the 2% range. Discount supermarkets in the UK are operating on around 0.7% margins.
They are still huge, profitable businesses.
And they are examples of what happens when markets work.
There are three different supermarkets in my neighborhood but they all sell milk from the same two suppliers. It would actually be quite difficult for me to turn to a third brand.
Which is an intentional failure of the system
How is that different from any other model provider, though? I used to use Anthropic for 100% of my code. Now I use GLM 5.2 for half of it, and as soon as something better appears, I'll use that.