alt Hacker NewsCost will keep dropping, but the frontier will keep getting pushed. The whole "give me today's model 10x cheaper and I'm good" line is a fallacy. It isn't true now and it never will be for the top 1% of tasks, which will create the most economic gains.
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There are an enormous number of tasks that can get by on good enough.
If you need image recognition, and a 30B model saturates the use case with 100% accuracy, you absolutely wouldn't continue to use the next frontier model as they come out.
And I'd argue most economically meaningful tasks will be saturated by cheaper models than those requiring frontier.
Think about what today's models can do with pretty close to 100% accuracy, and then consider that they will be orders of magnitudes cheaper over the years.
5.6 Sol can already obviate tons of labor, and why would you pay 2x or more for no meaningful gain?
The relative gap between frontier and non frontier also continues to shrink, so it's not like you take a meaningful performance loss by rewinding to models from 3-6 months ago. And soon that gap will expand to 12-24 months.
I get the impression the majority of people on here only think about coding, which net net will be a tiny volume of overall AI use in the end.
I think there's an intelligence limit, or at least asymptote. It may be above human intelligence, but I don't think it's miles above it (at least not the kind of intelligence humans can create, recognize, or use). For example in Go, most estimates place God or "perfect play" three ranks above top professionals[0]. In the latest human-AI Go match, the human got a 2 stone handicap. So it's not like we have a lot more frontier to push there.
its already true today according to openrouter usage stats. https://openrouter.ai/rankings Most people just use cheaper open weight
> It isn't true now and it never will be for the top 1% of tasks, which will create the most economic gains
Vulcan Materials Company has produced some of the strongest and most resilient economic gains for investors at around 25% gross margins for 50 years.
Vulcan’s business is crushing rocks, and then driving those rocks to where people need crushed rocks.
I mention it because Vulcan isn’t a sophisticated business at its core, but its economic returns are exceptional, because they do their unsophisticated work exceptionally well, and exceptionally efficiently.
Across the economy, most economic gains are created by companies like Vulcan, who do boring repetitive work exceptionally well and efficiently.
I expect this to hold true into the era of AI. Most stuff probably doesn’t need an exceptional model, and paying for an exceptional model to do unsophisticated work will leave your business vulnerable to competitors who take time to find the most efficient model for the task, and undercut you.