Commenter challenges claim that cost decline mitigates open-model threat
5 Sep 23 12:10 PM · 2d ago · 5 comments · 1 source · development 5 of 5
A Hacker News commenter disputes the article's argument that rapid cost reductions diminish the threat of open models to big AI companies, arguing instead that competition—from any source—will drive prices down regardless and reduce profit margins.
“The 'threat' (to the profits of big AI companies) is that competition will drive prices down in a race to the bottom. It doesn't really 'help' (drive the profits for big AI companies) if that competition comes from open-ish models or from competing big AI companies or anywhere else.”
jmull
Alex Tabarrok Economist, Marginal Revolution bloggerEpoch AI Research organizationOpenAI AI company
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What people said 5 voices · verbatim
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> This is one reason the open-model threat is not as large as it appears: frontier models don’t merely outperform older models; they are rapidly becoming cheaper to run at any given level of performance.This really misses the point. The “threat” (to the profits of big AI companies) is that competition will drive prices down in a race to the…
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Yes, the price of inference is falling rapidly.What about the cost? Inference looks like a viable business model for those operators that have access to SOTA model and serving infrastructure, but the investment required to have it is enormous, and appears to be never-ending, because if an operator stops investing aggressively, its model and…
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Cost per token goes down yes. But are you using more tokens per task/ prompt/ project?
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Why does electricity stop at 1973? It's been going back up again for the last few years.
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I mean, this is more or less true of Marginal Revolution for over a decade now...
All 5 developments of AI inference costs plunge 725-fold in 18 months, Epoch AI… →
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