> There are very good open-weight Chinese models

All the more reasons for us to figure out how to keep getting open models, or we are subject to the will of the the few frontier labs.

From first principles I think youre right, but also Anthropic is making something like 80% margins.

It demonstrates why Anthropic has to IPO ASAP. Private investors are beginning to tap out. Anthropic is selling junior debt over 10% where it was about 8.5% last offer. If Anthropic wants to meet its compute purchase obligations (via actual business), it needs to start tapping public markets ASAP as its position is getting weaker. The size of the float and how much is primary vs secondary sale is the data we're missing right now. If the float is small and from secondary sales, the IPO is an exit and investors would be wise to stay away as Anthropic's runway stays where it is and therefore would require a re-acceleration of revenue growth to survive. If it is large and mostly from primary sales, it is a legit fund raise which extends the runway and revenue growth can be allowed to slow because of the pricing pressure you mentioned.

I believe Anthropic IPO is a pump and dump at this point.

The work going on to improve things on single card like a 3090 is nuts. HyperQwen, other things. I have my subscriptions, but always good to explore options.

Sure, but, in absence of money, where are the open models going to come from? They take a lot of effort and resources to train. The current ones have been made in hope the growth will lead to a payoff one way or another. With the two main giants struggling and the market cooling, that payoff becomes quite uncertain.

open weight, "how we trained it" is the open source of LLMs

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At this rate ANT will end up as a division of Amazon

We’ve seen a similar drop in spend. 3-5x less for entire teams comparing September and October.

It’s not clear whether people are being more careful, or if the price per effort is in free fall.

Would it partly be explained by Haiku 5.5?

At work I am stuck with Claude, but I was always mindful of the cost of that thing.

With aggressive clean session management and some judicious compacting, I get Opus to plan, Haiku to code, Sonnet to review.

I managed to reduce costs from ~$200 to ~$50 in a month, even when I started to use Claude for more tasks than I did before.

1m/month? whoever is running your company is out to lunch.

Nobody on the outside knows for sure, but two key signals to watch are project sunsets and brain drain.

If the rumors of fundraising difficulties are true, OAI will have to prioritize its most profitable projects, potentially slowing down new training runs and optimizing existing models for efficiency at the expense of user experience.

Insiders are also the first to sense internal trouble, so if top talent starts leaving for competitors preparing to go public, it won't bode well for the company.

The amount itself is probably meaningless. The fact that there was a shortfall at all is, for me, the signal.

Not too long ago, people were fighting to throw money at them. That might be the sign that we're past the peak of inflated expectations and going down towards the through of disillusionment .

If this is being announced here, it was probably started at least a few months ago, and at that point funding was likely looking a lot more forthcoming, so it would make sense to try to raise more than is strictly necessary if the price is good. On that basis, it might not be a problematic shortfall.

oh but that's nothing... consider all previous financing episodes and the companies involved

They’re dead. As soon as people start getting fearful you’ll go to zero, they won’t have FOMO anymore. FOMO was the only reason people were investing.

That’s why the Mac mini and studio are selling like hotcakes. Massive unified memory with massive cpu performance, with a solid hardware. If I had 3-4K burning a hole in my pocket I know what I’d be getting.

You won't. It will become something you install like a browser.

The depreciation on a sufficiently powerful local machine costs more than the subscription to cloud frontier AI.

The subheading in the article is telling, and doesn't appear to demonstrate anything I would describe as "bursting"

> The ChatGPT maker’s latest funding round values it at $1.25 trillion, less than its $1.4 trillion target

MSFT isn't laying off 60k people. It's offering voluntary severance, which will have a sub-10% take-up (for reference at GOOG it was low single digits).

I think Microsoft laying off 60,000 people was going to happen regardless of this AI boom or even the economy being in the absolute shitter it's in right now.

When the economy was much stronger in 2018 their headcount was around 131,000 people. By 2020 that jumped to 163,000, and by 2022 it reached 221,000. I have personally heard of employees feeling like they had nothing to do.

With their current head count at around 218,000 employees (I'm excluding their Activision head count here), bringing things back down to 160,000 or so employees sounds a bit more realistic, especially given that Microsoft has not been expanding its range of products significantly. They're building out more in the spaces they're in, but they've been pretty conservative on new product launches compared to others.

> Why do I sense a schadenfreude here? It's like people are rooting for their failure.

You sound surprised. Why?

After all, they have been selling their product on the basis of driving the value of human labour as close to zero as possible (your labour included). Why wouldn't people want such an endeavour to fail?

They've been rooting for ours, it's only fair.

Among other reasons, because it's been evident that the numbers won't add up from the beginning. It's always delicious when reality catches on a major scam.

They're trying to enclose all of human knowledge so they can sell it back to us, all while displacing human labor and centralizing control of the economy.

They're telling us human endeavors are no longer needed if they succeeded, they also warn us that they might accidentally cause the end of the world in the process.

Why shouldn't we root for their failure?

Some of us truly are.

Once the bubble bursts we can finally sweep up the datacenter GPUs and jerry rig them to our home servers!

Use Ultra mode.

> No no no, don’t burst that AI bubble just yet. I haven’t finished all my side-projects.

You'll be fine; the GPUs will be sold off for pennies on the dollar, and if you can't run one at home there are plenty of people who will buy them to host for cost of hosting +5% markup.

The consumer-level services you've gotten used to will still exist no matter how hard the bubble bursts, if it ever does. Way too many players now.

Over last 3 years on HN I have seen such low quality comments : prophesizing the end of times - the bubble will burst and we will all be so happy after that.

Any tiny news article that indicates even a modicum of challenges for OpenAI will be met with slurry of such comments.

Perhaps it’s good to keep a good epistemic hygiene in all this. OpenAI isn’t going away anywhere soon. AI isn’t going away, in fact we haven’t even started yet.

I’m not touching any of that stock, most likely ever.

There’s so much money that has been poured into this, with absolutely no revenue to justify it. Trillions of investments generating billions of losses.

Now they’re looking for retail and retirement funds to pay off the debt.

This is not to say that no one will make a profit; I’m sure some people are _very_ happy.

yes

> you turn down the opportunity to buy OpenAI shares at this current valuation?

1.25T? Yes.

Open models exist, and are extremely capable. OpenAI will never achieve a decent ROI when that is true.

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