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The Time Bomb Went Off: AI's All-You-Can-Eat Era Just Ended in Real Time (www.thestateofbrand.com)
submitted 5 months ago by to c/fuck_ai@lemmy.world
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Excerpt:

The IPO Math Forces the Issue

Both OpenAI and Anthropic are on IPO timelines for the second half of 2026. OpenAI completed the largest private funding round in history in April, $122 billion at an $852 billion post-money valuation. Anthropic has reportedly surpassed $30 billion in annualized revenue. Massive numbers, both of them. Also both attached to companies that are still burning cash at extraordinary rates.

Public markets will not tolerate the gap between subscription revenue and compute cost that has defined the past three years. The moment either company files, analysts will demand unit economics that show a path to margin. Usage-based billing is the fastest way to demonstrate that path.

None of this contradicts the repricing thesis. The pricing war is the last land grab before the gate closes. Both companies are spending aggressively now to lock in users whose switching costs will make them sticky when prices rise. OpenAI offers two months free. Anthropic offers 50% more capacity. Both expire in July. What comes after July is the real pricing.

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[+] -16 points 5 months ago (5 children)

This assumes that their main product is the AI that they sell to the world and not the AGI that they’re developing to replace humans.

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  • [–] 35 points 5 months ago (3 children)

    AGI ain't happening, it's a pipe dream. The best that's going to happen is less power consumption through more efficient chipsets. These tech billionaires are delusional. For anything technical "ai" is useless if the answers don't already exist in the training data.

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  • [–] 16 points 5 months ago

    Yes. In addition: AGI requires situated knowledge and human-level interaction which involve difficult research problems that are still a long way from being solved. The techbros have been finding out that just throwing data at these problems doesn't work.

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  • [–] 8 points 5 months ago (1 child)

    AGI "can't" happen like man can't fly or 256 KB is enough memory. Will or can it happen? No one is sure. Will it happen this way, through plugging more compute and power into LLMs, that's a definite no. But it's the money grab right now, and anyone who didn't follow the leaders would have been left behind with nothing.

    So you're right for this discussion, but in the broader sense we can't say that for sure. One thing I'm sure about is how LLMs and the profit scramble for it have ruined actual research into the real thing.

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