OpenAI and Anthropic account for 70% of major cloud providers' AI revenue
Critics argue most AI infrastructure spending flows to just two companies, raising questions about demand outside the frontier labs.
What to know
- OpenAI and Anthropic account for roughly 70% of AI-related revenue at Microsoft, Google, and Amazon, according to widely circulated analysis from Ed Zitron.
- The concentration raises questions about whether AI demand exists outside these two labs or whether much of the compute spending is circular financing between cloud providers and the labs themselves.
- Cloud providers have made massive capital investments in data centers and GPUs on the assumption of widespread AI adoption, but critics argue that adoption outside the frontier labs does not justify the buildout.
- The claim has divided commenters: skeptics question the analysis methodology and argue enterprise adoption will eventually justify the infrastructure, while others worry it signals an unsustainable AI bubble.
The dispute Whether the 70% concentration figure indicates a collapsing bubble or is simply a mischaracterization of temporary, eventually-replaceable cloud provider revenue as a sign of failed AI demand. · positions read across 16 posts and comments
The concentration of AI spending in two labs signals a bubble, with overbuilt capacity and artificial demand driven by circular financing.
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“70 percent of Microsoft's AI revenue is coming from a single customer — OpenAI. I have to ask: is the AI bubble about to burst?”
Robert Reich · Bluesky ↗
The statistic conflates compute revenue with AI demand; real enterprise adoption and decentralized LLM workloads will eventually justify the infrastructure.
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“I think this whole premise is ignoring the point that most decently sized companies want to and eventually will be running their own LLM workloads.”
reilly3000 · Hacker News ↗
Zitron's repeated dire predictions about AI have been wrong before; his credibility on this claim is questionable.
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“Ed wrote a post back in 2024 where he claimed OpenAI would fail in 2 years if they didn't do the, seemingly impossible at that time, things like raising more money than any company before etc. And OpenAI did all of that and is still alive…”
jatins · Hacker News ↗
Ed Zitron Analyst and columnist
Robert Reich Public figure and commentatorOpenAI AI companyAnthropic AI company
The record 6 articles and posts · last 30 days
What people are saying 16 voices from 2 sites · verbatim
- What constitutes 'AI revenue' in these cloud provider figures—is it circular compute spending or genuine customer AI services?
- If Google and xAI exit frontier model development, what happens to compute demand and pricing?
- Will enterprise adoption of AI eventually spread compute spending beyond OpenAI and Anthropic?
- Aug 9
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Im not sure what this phrase even means. Does it mean that "70% of the revenue made by companies selling tokens comes from openAI and anthropic"? If so, how does it follow that "the AI industry doesn't exist"? For every other industry, the "size of the industry" is given by the total revenue, not by the percentage of the top 2.These people don't…
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Ed wrote a post back in 2024 where he claimed OpenAI would fail in 2 years if they didn’t do the, seemingly impossible at that time, things like raising more money than any company before etc.And OpenAI did all of that and is still alive today. Would be good to know this context because if you are out there boldly making doomer predictions month…
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You can like the character or not, but there is a trend I’m following ( heavily vested in NVIDIA, so tongue in cheek when I say this ) that might be highly align with Zitron. Looking at the moves from NVIDIA ( Groq )and AMD ( Taalas ) which are pure inference plays. I believe this shows that the impetus to train a better-bigger model might be…
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Is anyone really running GPU databases in prod at scale? Or are you assuming that the GPU compute from a crash will become so cheap that it makes this niche scale?
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R
70 percent of Microsoft's AI revenue is coming from a single customer — OpenAI. I have to ask: is the AI bubble about to burst?
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> most decently sized companies want to and eventually will be running their own LLM workloadsAnd probably some decently sized states too. Not only commercial actors are up to the job.
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but this is just an absolute fantasy, what, exactly, will this compute be doing? Our lives are already deeply entwined with technology and use barely any compute. How could our lives become 100x more dependent on compute?You can be thrilled by this exciting technology and all the possibilities it brings without thinking it is going to require this…
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TIL about GPU databases. I did a bit if research but only found this one: https://github.com/bakks/virginianWhat are the advantages of a GPU database?
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"Because Goldman does this kind of nonsense."Hilarious. You can agree or disagree with Zitron but he really has no business talking about Goldman Sachs. His posts are littered with evidence he has no ability to perform the type of financial analysis he thinks he does.
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I think this whole premise is ignoring the point that most decently sized companies want to and eventually will be running their own LLM workloads. Currently use cases are limited by scope and imagination, and predominantly focused on cost efficiency. Once a use case becomes a top line revenue driver budgets will become essentially only limited by…
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I don't know much about this guy other than every time I see him on here he has an axe to grind about AI
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Ai revenue or datacenter/compute revenue? There's a lot of circular financing right now and there's a pretty obvious bubble for sure but I haven't been able to figure out what exactly this guy's argument is after seeing it a few times recently. Like yeah most ai datacenter spend is those two companies - that's pretty standard monopoly (or…
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The unsaid part of this is that both Google and xAI are looking like they're sort of giving up on frontier models, which means they will create more supply and less demand for AI compute, further centralizing it around Anthropic and OpenAI. The void yearns [embedded post]
- Aug 7
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E
Joined the Times Tech Report to talk about how 70%+ of Amazon, Google and Microsoft's AI revenues come from OpenAI and Anthropic, meaning that outside of two unsustainable AI labs, there isn't anywhere near the demand to justify the capex or the data center buildout.
- Aug 5
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Just crossed the terminal: Microsoft disclosures suggest that OpenAI is about 70% of AI sales! If only someone had said something
- Aug 4
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Analysts estimate that 70%+ of Microsoft, Google and Amazon's present and future AI revenues are from Anthropic and OpenAI's compute spend and model sales. Outside of two unsustainable AI labs, demand barely exists, and they've massively overbuilt capacity.