Cheap AI

Oracle’s main problem is that AI is about to become very cheap.

A year ago, anything but a frontier model was absolutely stupid and barely usable. But now they are OK-ish, and in a year they will be actually very good. Why, then, pay an expensive "frontier model tax"? It’s like, if a Ford can get you to work as much as a Bugatti, why buy the Bugatti?

So Amazon Bedrock I somehow grasp (and each of the other big three is developing "cheaper chips than NVIDIA" on top). But Oracle looks weirdly expecting that people will just like that continue to pay premium pricing.

#AI #Pricing #Competition #CorporateStrategy

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It also depends on the work you are trying to complete. If the free chatgpt meets your needs than why buy a subscription but if you meed more functionality it will cost more. Nothing is really changing.

@ah seems you missed OP's point.

This just shows the necessity of ensuring all inference is cloud-based. Not only is local-AI inefficient, it is obvious that it needs regulation and control. Training will never be cheap, so it is safe, but intelligent inference (the kind that is regulated and approved) needs to be corralled.

So much bad news!
🍿🍿🍿

@OP
...and let's be bluntly honest, that's just one of the many reasons that OpenAI and Oracle are both going to fail.

And let's also add that neither company is "too big" to fail, so magical thinkers need not reapond.

They have already hit a plateau with consumers. 95% people on earth don’t even use AI paid plans. So who they really gunna sell to? It’s only profitable to sell to institutions that will use it for R&D

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