Comment by zackify
5 hours ago
The world doesn't make sense to me. I use 5.6 Luna. Deepseek v4 flash 0731. And kimi k3. Don't even need claude anymore at their insane prices for anything I do.
5 hours ago
The world doesn't make sense to me. I use 5.6 Luna. Deepseek v4 flash 0731. And kimi k3. Don't even need claude anymore at their insane prices for anything I do.
If you're primarily writing code yourself or meticulously reviewing the output from agents, then you're right. However, if you tried to have any of those models one-shot an app or do some highly agentic work, they would certainly fail. That's the future people are looking towards with these valuations: when its no longer economical for humans to write or even understand code, just let the models drive because they are superhuman at it. Not saying we are there today, but that's when you really start to see the benefit of more expensive models. Luna or Deepseek flash would never find any of the mathematical discoveries or security exploits that the larger models can find.
Claude is certainly able to make a superhuman mess. All of its efficacy still hinges upon good architecture and programming principles, which do not seem to be instilled in the model by anything other than luck
I'm not convinced that one-shotting things is anything other than a vanity-metric.
Maybe in the distant future where quickly building a visualisation to help explain some concept would be valuable to one shot quickly - but "One shotting an app" is ridiculous because app development (or any development) is never "build it and then finish" but is an interative process, testing feedback, user feedback, and even app-creator communication ambiguity means being able to "one shot an app" is pretty worthless
But.. what is it that anthropic does that cannot be replicated by open models teamed up with open source? Heck open source even has cheap AI to help write the code now.
The moat is money. How do you get more money? Point to your moat and ask for more money!
What enterprises pay for is all that matters. They pay insane amounts for a lot of things I would never do personally, but I'm not the target demographic in those cases.
Right, and it's often very sane. If you're paying $250k/year for a software engineer, it likely makes sense to have them spend $10k/year on tokens from the best available model rather than trying to save a few thousand with random Chinese models that may or may not be good enough.
The Chinese companies will need to pay their bills eventually too.
> The Chinese companies will need to pay their bills eventually too.
What bills? Deepseek has been profitable for long time.
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Their purchasing costs are much lower proportionally.
China has cheaper electricity and a more capable grid for the industrial type usage levels they need to drive.
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Wouldn't enterprises rather run their own models locally?
While not today, very soon every company, of every complexity will run local models. It's not in a companies interest to hand over its domain expertise, data, and proprietary IP for a increase in productivity. Most will quickly realize it makes sense to run their own weights. This will be commonplace once tooling and training infrastructure is commoditized.
Enterprises don't even want to self-host webservers, and those are about a thousand times easier to do than self-hosting an AI model
In many things in life it’s wise to think further than just what suits your needs personally
200usd/mo for Claude gives me tens of thousands of dollars of value.
API prices are paid by companies getting tens of millions of dollars of value.
In normal life money is the key constraint; buy this don't buy that etc. - whereas in VC funded companies the constraint is time. If you as a founder get funding and don't spend it fast enough you put yourself at serious risk of being replaced.
When enough of the world operates on that principle it creates a highly price insensitive market and that then can support a ton of ideas and experiments, some of which turn out to be really really good. It's a wild way to do innovation but it's been working well for decades.
It doesn't, though.
$200/mo of Claude may give you what would have cost tens of thousands of dollars to create in 2023, but the value of what it creates isn't there anymore. It should be compared against what it would cost to create with other tools, not against the cost of you doing it by hand.
Otherwise would be like justifying an obviously overpriced car, because "it saves me so much compared to carrying things thousands of miles by hand!"
Your comparison is wrong
It's not an expensive car vs. any car.
It's car vs. no car.
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> 200usd/mo for Claude gives me tens of thousands of dollars of value.
That may well be true, but the same tens of thousands of dollars of value can be purchased for a fraction of the 200usd Anthropic asks.... therefore why not?
And even beyond pure monetary considerations, it often refuses to help as soon as its trigger happy safeguards kick in, can't debug a lot of code before it decides to stop helping IME.
It's less fungible than you think.
Below a certain threshold prices are effectively all the same.
Companies pay API prices because part of the bundle is a trust anchor / liability shield: "we bought Anthropic's thing! We didn't risk it! We paid for ZDR!"
It takes a big leap of faith for real companies with a real P&L to hand out token budgets in the thousands far and wide across their teams. The ROI is very easy difficult to demonstrate.
I've been thinking about it a lot and I think there's going to be commoditization of tokens. No local models - the hardware to run at scale is too complicated for companies that are reluctant to even run a local file server - and not wholesale run to Chinese suppliers (due to IP considerations mainly).
I think the winners in the coding/office work space will be intermediaries who can sell reasonable quality tokens at cost plus. It's the same reason "real" companies don't hand out their employees fully decked Macbook Pros or don't provide $500k TC packages as a norm: they are fine with "good enough" and "good ROI". And that's not going to happen with Claude API pricing where it is.
Another field is API pricing for things that are not coding, like automated systems doing analysis of things. I think there it's a real race to the bottom, including - or even mostly - direct sourcing from China (just like business do with their real goods today).
paying for API calls gives you no such deal hack.
> Don't even need claude anymore at their insane prices for anything I do.
What insane price is that? Pro is $20 per month. Same price as a Netflix ad free sub.
Until they stop to subsidize.
Let's try a thought experiment. It's not subsidized. It's not "worth" the tens of times it costs if accessed through API. Let's drop the subsidy word, they're selling you a product, and they're trying to sell other people a similar product at 30x the price with some excuses. If either (or both) turns out to be unsustainable, they haven't been subsidizing you, they just had a crap business model (or a perfectly good one, if the goal was an inflated valuation, an IPO and then a crash once the losses are socialized).
They might raise the price, but I don't think they will ever get rid of the $20 tier. It is way too consumer friendly and likely has the highest percentage of users that aren't abusing their quota limits. A layperson will be extremely hard pressed to create an API key, know what to do with it, put money in their account. People want an easy subscription.
Are they going to get to $200B revenue in 2028 at $20/month? That's a billion monthly subscribers. In 2028.
I walk to work and ride a bicycle in my free time, don’t see why anybody would need a hatchback or semi truck or build rockets. Idiots
Is the market for the "rockets" enough to justify what these frontier labs are spending yearly?
Anthropic’s revenue run rate just hit $50B, in a market that didn’t exist 5 years ago and was 10% of its current size 1 year ago. They are, by far, the fastest growing company in human history. The demand for “rockets” has been pretty high and growing ever since they started supplying it.
Anthropic and its investors/customers don’t need random internet commenter’s permission to decide whether or not something is worth doing or justified.
Personally I think when something doesn’t make sense to you, you should try to figure out why it makes sense to other people, and whether they might have different needs/constraints/incentives/skills/knowledge.
Why might people spend more on AI as it gets better, rather than less? Could they, perhaps, allow for entirely new kinds of capabilities and products that hacker news commenters have not yet seen? As they have done every year for 3 straight years (hacker news has been wrong in exactly the same way every time, btw)? Might some people prefer to spend $10/day to work with the most capable AI available, due to the amount they use it while doing their job, and its effect on output? Do some people use AI for more than just tinkering with open source harnesses? Could it be that when you don’t understand something, there really is a way to explain it, that isn’t “everybody else must be stupid”?