alt Hacker News> Dario explained it very clearly in an older interview. If every model is bigger and more expensive to train, each model can individually be profitable, while the company as a whole still shows a loss at any given point in time.
“We’re profitable as long as you ignore our ever increasing cost of goods sold, we promise it’s not a pyramid scheme” - ~~Charles Ponzi~~ Dario
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But the reason the cost is ever increasing is the steeply ascending quality. There's no (non-doom) scenario where this game does not end with profitable cheap tokens. Wherever it'll stop scaling, it'll be profitable to serve tokens at that scale. And of course if it doesn't stop scaling, it's the singularity and all this thought of profits is quite secondary.
An industry cannot fail because it's too successful.
edit: Other explanation. The industry has found a moneyprinter. It prints money, and several companies are building them and printing money. However, each one of those companies is cashflow negative, because they're all trying their desperate best to build an even larger moneyprinter. Why? If they don't build it and the next company over does build it, and it works, then company 1 is differentially outcompeted. what's more, the more expensive each moneyprinter is, once a company gets strongly ahead the second company won't get the financing to keep up with that one. ... But it's still moneyprinters. This is not an economic race that ends up with "and thus everyone stopped printing money."
And that interview was explicitly a hypothetical. It was shared here a few months back.
Dario also believes that verifiability is trivial, which I'm much more sceptical of.