> If prices keep going up, watch for companies to exit frontier models and go to local llama.cpp instances for 6-month-ago SOTA, with the flex of being housed within the office - no more privacy leakage, no more price gouging.

That or just hiring people to do the work! I hear rumours that this is already starting to happen in some places (perhaps those that were a little overzealous with AI-hype driven layoffs).

I do think many will move to lower cost models or self hosted over the next few years as prices balloon. And the privacy/control story is compelling.

If we're able to see some big increases in hardware capabilities that can be self-hosted, that will be an accelerant.

That said, most companies just want to pay a provider to delegate responsibility in exchange for cost and control.

> I’m not sure why a Y-Combinator backed company hasn’t come out yet flooding the market with highly capable OPAI

If we momentarily disregard the fact that YC itself owns billions of dollars worth of OpenAI shares[1], YC would plan to find demo-day investors willing to drive down the value of frontier labs. The coöpetition among VCs and the existing web of AI investments will mean no VC will be interested in investing in local AI...until after the frontier labs IPO.

1. Thanks to the self-dea^w foresight of former YC president Sam Altman