alt Hacker NewsThis right here is going to be considered one of the first major signs of the downfall of closed models years from now.
And look, if you disagree with me PLEASE tell me why. What moat do these companies have? I genuinely want to know because looking at the spend for companies like OAI and Anthropic with no actual moat I can identify is actually driving me insane.
Replies
athorax • today at 4:07 PM
The moat is enterprise contracts and artificial friction moving between harnesses. Moat is a strong word, more of a puddle.
I think the frontier AI companies think you're missing key details:
- they can still discover entire new untapped markets for AI (that, potentially, only their models can unlock)
- they can find (novel, unique to them) ways to drive down the cost of running their models
- they can provide other ancillary value (e.g. write better harnesses) because of their expertise, and then charge for that value
I'm probably missing a few bullet points also. However, none of those are moats (or at least not yet) ... I'd consider them more like bets. The frontier AI companies are betting "the house" on them, and if they pay off they could, hypothetically, make them financially competitive.