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runtime_terror | on: Outsourcing plus local AI will soon become more economical vs. frontier labs
> The subscription token price is 10x-40x cheaper than API pricing

This is a temporary phenomenon. Expect either drastic price increases or draconian throttling or both in the coming months.

These companies are operating at huge loses and have hundreds of billions in liabilities and commitments. They need to turn on the money faucet sooner than later.

Npovview | parent | next
Even with increased prices, AI enables velocity both in development and bugs fixing. Would companies want that? If prices are biting the company, I think companies will route all development and bugs fixing requests through few superperfomer developers with complete knowledge of the different components within the company (they will be the Queen Bees holding the company on their head). The rest of the company will be tasked with requirment gathering, specs cleaning, deambiguation and so on (worker bees).
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DougN7 | root | parent
From what I understand, that is sort of how IBM Bob works - multiple models behind the scenes and they route the request to the model that will handle it best at the lowest price.
alfiedotwtf | parent | next
Incentives matter…

If prices keep going up, watch for companies to exit frontier models and go to local llama.cpp instances for 6-month-ago SOTA, with the flex of being housed within the office - no more privacy leakage, no more price gouging.

To be honest, I’m not sure why a Y-Combinator backed company hasn’t come out yet flooding the market with highly capable OPAI (pronounced “Oh-pah” as in what Greeks shout as the drink shots), which stands for “On-Prem AI”

… yes, I just made up OPAI right now lol

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overfeed | root | parent
> I’m not sure why a Y-Combinator backed company hasn’t come out yet flooding the market with highly capable OPAI

If we momentarily disregard the fact that YC itself owns billions of dollars worth of OpenAI shares[1], YC would plan to find demo-day investors willing to drive down the value of frontier labs. The coöpetition among VCs and the existing web of AI investments will mean no VC will be interested in investing in local AI...until after the frontier labs IPO.

1. Thanks to the self-dea^w foresight of former YC president Sam Altman

anthonypasq | parent
Theres recent reporting that Anthropic will be profitable this quarter...

edit: I see in other comments on this thread you think Ed Zitron is a reliable pundit so that explains everything.

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