| Ryuu96 said: The issue is a company managing to create an AI model which is just as good, or simply good enough, when compared to the competition, at a fraction of the cost and resources, so why are people like Sam Altman asking for 100s of billions of dollars? US companies have been leading the AI battle and that has been driving their valuations, now investors will wonder just how far these companies really are in the lead, with tens of billions being spent with zero profits in return for years on end. Of course AI won't die but it shows a little fragility in the US companies hold on the AI market and this after all the song and dance about $500bn being invested into AI by US Companies whilst OpenAI loses $5bn+ per year. OpenAI is just one AI company though, but it is the most well known and Sam Altman comes across as a massive con artist and I do not believe OpenAI will be the one to make the breakthroughs and the problem is, a lot of companies are hedging a lot on OpenAI. Nvidia is down 16% now, I'm sure it will rebound but there's fragility being shown for US companies. Nvidia Stock Plunges 15% As NVDA Heads To Biggest Market Cap Loss Ever |
None of the people who keep up with this technology are surprised that the cost for reasoning models is coming down. The surprise is mostly that it is coming from a Chinese company, as Chinese companies have been behind for a while now and they're under a chip embargo. These advancements happen in cycles and advancements are made across companies, not within a single one.
Basically you have Google and Nvidia doing fundamental research. They're the ones really pushing the boundaries of what we know.
Open AI/Anthropic/Meta/Mistral and now Deepseek are basically implementing this fundamental research into practical applications. This follows a cost-cycle, where if you want to be the first-to-release (as OpenAI tends to want to be) it costs a lot, but then as optimizations are discovered you can reduce the cost over time. So Open AI released o1-preview (an iteration of a model they first innovated in November 2023) in September and open-source has pretty much caught up with it in January at a cheaper price. That's not surprising. o3 will release in February, and you basically have the companies leap-frogging each-other until the next paradigm shift occurs (which seems to be Agents/Operators and/or an implementation of Google's Titans architecture.) Then the cycle repeats itself again until we get to the point of recursive self-improvement.
I do think there will be a bubble bust, just like the Dot-Com bubble or any other capitalist business cycle, but the market will exist nevertheless.
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