Competition drives prices down. We tried Kimi and GLM models after hitting 'cybersecurity' blocks on OpenAI and Anthropic. We found them to be much cheaper to access and helped us complete our work without 'cybersecurity' refusals blocking us.
_heimdall 2 hours ago [-]
If this is mostly competition enduced, I have to assume either their usage has plummeted or they will implode financially in short order.
The frontier labs were already burning money on more expensive price models, and competition wouldn't have reduced their capex proportionately.
p0nce 2 hours ago [-]
How could they do anything but implode financially? Genuinely curious. The numbers are not right.
_heimdall 4 minutes ago [-]
The government could bail them out, that's the most likely scenario if they don't implode IMO.
They could also continue to grow at the rates they had last year. I don't know where those customers would come from, but if they did pull that off OpenAI and Anthropic could sustain propping up the circular financing going around the AI industry.
smallmancontrov 1 hours ago [-]
Did the frontier labs take out debt or did they make flimsy unenforceable agreements to neoclouds who took out debt?
bunderbunder 25 minutes ago [-]
Borrowing money is not the only way to go into debt. They reportedly made binding and non-cancelable commitments. Once those commitments come due then they will be indebted to their counterparties until they pay up or the courts sort it out.
This is comparable to how, if I sign a 12 month non-cancelable lease and then don’t pay the rent, I will be in debt to my landlord.
_heimdall 3 minutes ago [-]
That's effectively borrowing money with a different name though. The only way to go into debt is to sign an agreement to pay someone money in the future, regardless of the terms used to describe it.
kshacker 2 hours ago [-]
That's why Anthropic are rushing the IPO. You can explain a single quarter slowdown, you can not explain a multi quarter one.
stingraycharles 2 hours ago [-]
What makes you say that Anthropic has multi quarter slowdowns?
_heimdall 2 minutes ago [-]
I don't have the numbers in front of me but could have sworn I had seen quarterly revenue growth rates dropping drastically over the last year or so. Still a strong growth rate, but much lower than prior growth rates.
kshacker 2 hours ago [-]
I am technically not saying that. I am taking off from the parent comment and speculating.
Their data from September is leaked via IPO preview, and October is not yet complete, so how can someone even project that?
// I am a techie, not a finance guy, so apart from public chatter, no inside knowledge.
And I do feel their IPO is being rushed before anyone has enough information to make up their mind. The VCs or private equity have given them a lot of money and want to cash out. When the revenue does slow down, any investor should pause to take a look at whether they can right the ship, or has the landscape itself changed.
TacticalCoder 1 hours ago [-]
> If this is mostly competition enduced, I have to assume either their usage has plummeted or they will implode financially in short order.
If we assume it's due to competition, then their usage has precisely not plummeted because they cut prices by 80%.
D13Fd 2 hours ago [-]
So much this. I’m using these models primarily for dumb hobby projects and I’ve still hit this a lot - although much less so in Opus 5.5.
soupfordummies 3 hours ago [-]
I wouldn’t be surprised if US “bans” access to the Chinese models by the end of the year
bethekidyouwant 3 hours ago [-]
How?
xscott 3 hours ago [-]
I think your question is rhetorical, in which case I agree with the sentiment.
The US absolutely could (and very well might) make Chinese models illegal, possibly open weight models in general, but all that will do is keep them out of the hands of law abiding US citizens.
Law breakers in the US and the entire rest of the world would still have access, and nothing in the US will be any safer. People who think regulation will solve the problem should be embarrassed by their ignorance.
aktenlage 3 hours ago [-]
It may solve the problem of anthropic and open ai going out of business with all major consequences that would have for the rest of the US.
xscott 3 hours ago [-]
Lol, that's funny in an awful way. Choose between popping the AI bubble or creating a duopoly, and still have all the cybersecurity and other risks.
holoduke 3 hours ago [-]
I don't get why people think Chinese models could bring openai and anthropic to their knees. There are zero signs of such a scenario. In fact the market is still growing at a gigantic pace. Quality of American models is still AAA. Chinese will have their place. But they are unmatched by their American rivals.
bryanlarsen 1 hours ago [-]
"Bring them to their knees" is highly unlikely.
"Puncture expectations of a multi-trillion dollar valuation" OTOH seems quite likely to me.
xscott 3 hours ago [-]
If the capability keeps growing significantly, then I agree it's possible the US could hold their significant lead indefinitely.
However, capability could plateau or reach a point where most of the market can't tell the difference and isn't willing to pay a premium.
verdverm 2 hours ago [-]
> But they are unmatched by their American rivals.
Kimi K3.1 is top 5 on AA and half the price of Opus 5.5, Qwen4 is coming soon. There is near zero difference for most tasks, so it matters less today and even less as time goes on. Price is now the top concern for a reason.
“Ban open weight models”
Lol how. How do you even prove a model that I’m hosting is open weights?
xscott 2 hours ago [-]
There's a difference between something being illegal and being able to enforce that law.
eddythompson80 1 hours ago [-]
I don't know man. Marijuana is/was banned in most of the US. LOL, how do you ban a plant?
cwillu 1 hours ago [-]
Given the general availability, the answer appears to be “you mostly don't.”
jonathanstrange 3 hours ago [-]
Banning open weight models in the US would provide the rest of the world with a huge business advantage since these models are much more cost-effective than US models.
ApolloFortyNine 3 hours ago [-]
If you are a legally operating company in the US just saying it's banned is enough, the threat of enforcement is enough pressure.
You and I obviously can just use a VPN, but 99% of usage is likely as part of a company.
xscott 3 hours ago [-]
Presumably, legally operating companies aren't the dominant threat though. So banning open weight models doesn't solve anything.
SahAssar 3 hours ago [-]
> If you are a legally operating company in the US just saying it's banned is enough, the threat of enforcement is enough pressure.
Is there precedent for the US actually "banning" software? I know for example the Kaspersky ban and tiktok ban, but both of those were either banning the sales or banning the service. IIRC neither made the actual software illegal.
What is an example of a specific software being illegal to possess? What is an example of a specific software being illegal to use if it is not used to break other laws (copyright, etc.) or talks to banned service providers?
Closest thing I can think of is restricting the export of cryptography in the 90's, but that was not even close to what you are suggesting.
bethekidyouwant 2 hours ago [-]
Correct it’s 7% chance on kalshi, and those 7% of people are just wrong. I know everyone likes to larp that the US is some kind of dictatorship, but lol, lmao as they say.
Also on the “how” side so far we have “they will just announce that “they” are banned, hilarious.
I have a harness for my harnesses now. My Hermes manages Codex, CC or Cursor now and interact with me via Slack and PRs on GitHub.
It's nice because I can keep going from anywhere, other team members can see and interject in my Slack threads, and Hermes auto updates its skills with any adjustments that we make so we don't have to ask twice.
minimaxir 2 hours ago [-]
For me, I used Zed Agent with Codex as it has native integration with Zed's ACP so it's pretty convenient.
However, Anthropic is pickier about the harnesses you can use with Claude Code and I noticed discrepancies when using Zed's External Agent feature with Claude Code, so I just use the Claude app. It's fine.
mr_mitm 3 hours ago [-]
I found Claude Code to work best. You can use it with any compatible API.
denkmoon 3 hours ago [-]
Personally I've found Zed's agent to be much superior to OpenCode. IDK why but it gets better results from the same model on the same task. Using with GLM 5.3 and DeepSeek 4.1.
schaefer 2 hours ago [-]
Pi.dev at home.
And I’m slowly writing my own. But it’s garbage at the moment.
ylrd91 2 hours ago [-]
Don’t write your own. Fork maki.sh and customize it like I did. It’s built in Rust and is absolutely amazing.
schaefer 1 hours ago [-]
Thanks for the suggestion, but that’s not a fit for me.
I’m writing my own harness to learn. And I’m writing it in zig.
But, I’ll absolutely add maki.sh to my reading list. So, that’s a win.
leereeves 2 hours ago [-]
What kind of hardware do you need to run a useful LLM at home? To train one?
schaefer 2 hours ago [-]
> "What kind of hardware... "
At home, I mostly use openrouter.
A few bucks will realistically last you forever.
I also bought a DGX Spark at launch. I've learned a ton. but it's not usually my daily driver. I do run overnight tasks on it, like "read this book and write up notes on each chapter..."
In retrospect, given the dirt cheap prices of apis and or renting hardware, buying hardware for inference was likely a mistake (but not enough of a mistake to sell it now).
mynegation 2 hours ago [-]
Schaefer says they write their own harness, not necessarily training or running a local model.
hgoel 2 hours ago [-]
I've been pretty satisfied with OpenCode 2
limit2 36 minutes ago [-]
> leaked financials from both OpenAI and Anthropic show unsurprisingly that they are losing billions due to R&D/scaling
No, they are losing billions because LLMs are not a viable business. Their real business is making bombastic statements which the credulous press prints unquestioning, fooling various investors and ... that's it. IPO is another of these. You really should note how the Anthropic IPO date keeps slipping because they can't make the S-1 public as it would give away the game immediately. The market was fooled by SpaceX once you can't do this a second or third time.
riknos314 30 minutes ago [-]
Deepseek prices their models based on a 10 month hardware payback period. They report ~$38 revenue/GPU-hour on V4.1-Flash clusters.
Inference is clearly profitable. The question is whether it's profitable enough to justify the training research costs.
margorczynski 12 minutes ago [-]
V4.1-Flash is probably quite smaller and much more resource effective than the frontier models. Add to that much cheaper energy in China.
javier2 24 minutes ago [-]
At best, this tells you v4.1 flash is profitable, but can they really get $38 per gpu hour? Sounds like a lot.
parineum 22 minutes ago [-]
How much did it cost to train Deepseek v4.1 flash?
ThrowawayTestr 26 minutes ago [-]
The existence of websites where you can rent a GPU to run open models is proof that inference is profitable.
19 minutes ago [-]
redrix 3 hours ago [-]
This is why Anthropic and OpenAI are pushing for more “regulation”. You can’t show ROI to investors by cutting inference costs.
Regulation might inconvenience them a little, but the upside is huge if it means open models out of China get banned.
malisper 16 minutes ago [-]
> This is why Anthropic and OpenAI are pushing for more “regulation”
Given everything happening with Black October[0], don't you think regulating models may be reasonable?
That would be like regulating who gets access to the best food on a sinking ship. The USA could allocate capital and attention toward much better things, for the country and for their people. I just hope the next couple administrations are wise enough to not experiment with the idea that ASI can get the country out of this 'fall of Rome' slow motion decline.
_s_a_m_ 1 hours ago [-]
Ah yeah, our lovely free market, always asking for tariffs, blocking competition, to build cartels and monopolies.
parineum 20 minutes ago [-]
Free markets don't exist to help individual companies, they are explicitly meant to hinder them.
They are meant to help the consumer.
Unfortunately neither of the two parties in the US even pay lip service to free markets anymore.
verdverm 2 hours ago [-]
> You can’t show ROI to investors by cutting inference costs
You can as long as you can saturate hardware with profit that makes up for training costs (which are also in free fall).
Anthropic is most at risk since they haven't bought any hardware (afaik), however OpenAi is building custom silicon now. The rest of Mag7 are primarily hardware vendors
TSiege 2 hours ago [-]
Any sources on training costs in free fall? My understanding was training costs are proportional to model size. Is it just that compute costs are falling?
verdverm 2 hours ago [-]
MiMo RL'd their latest models for $3.5M (million, not billion). It's hardware, software, and algos
Training costs are not in free fall, and not every "post training" process is equal, Everyone does this differently. The costs certainly haven't gone down, to train a new 10T param model from scratch, like at all.
You cannot point at Xiaomis tiny model and compare it to training a 10T param model. The levels of dunning krueger are getting out of hand.
You also arent calculating the salaries of the people involved, of which there's only a few thousand worldwide in your hiring pool.
_aavaa_ 2 hours ago [-]
I believe that’s post-training, not pre-training.
verdverm 2 hours ago [-]
yes, just post training, which is the most expensive phase now as I understand it
greenavocado 2 hours ago [-]
I would think that access to power is more critical than compute
elmer2 2 hours ago [-]
This is the goal of all government regulations and it's always resulted in higher prices and near monopolies dominating the market.
Yet, so many Democrats support it.
smallmancontrov 2 hours ago [-]
In the hands of 4th party system Progressive Republicans and 5th party system New Deal Democrats, government was an extremely powerful force for trust-busting.
In the hands of 6th party system Republicans, namely Ronald Reagan and Robert Bork, the government worked hard to usher in a a new era of Robber Barons. We live in the culmination of this project.
History says the result depends on the hands, not the tool. 6th party system Democrats have largely failed to undo the Reagan/Bork policies, but that's an act of omission not comission and even then Lina Khan was a big step in the right direction. This issue was on the ballot in 2024 and will be again in 2028. Hopefully we make better choices in 2028.
dragonwriter 1 hours ago [-]
If you are going to limit the 5th Party system to the first half of the long 1930s-1990s period of overlapping realignments (which is pretty reasonable), then the 6th Party system should be the second half of that period, and the period from about the end of the Clinton Administration on should be the 7th Party system; you can call now the 6th Party system if you call the entire long realignment period the 5th (which makes some sense, too, though there is a pretty significant difference between the New Deal dominant period and the Civil Rights dominant period of the realignment), but to split it somewhere in the middle but then lump the period after with it makes little sense.
smallmancontrov 43 minutes ago [-]
If you want to call Obama and Biden 7th party system, I don't really agree but I also don't think it matters for my argument: we can just re-label them and move on.
dabinat 2 hours ago [-]
If you take away all regulation you’d probably end up with a monopoly anyway, as companies would no longer be prevented from merging with their competitors or using underhand tactics to gain market share.
smallmancontrov 2 hours ago [-]
It's wild how businessmen will pitch you the 10 ways they will abuse the rules of the game to obtain a monopoly and extract rent, then they will turn around and say that the game rules are perfect and our only failing is not following them hard enough.
solyin 1 hours ago [-]
Goomba fallacy
smallmancontrov 1 hours ago [-]
Nope, same guy. Seen it a dozen times. Unenlightened self interest is a helluva drug.
cman1444 1 hours ago [-]
This is the goal of some, but very few overall, government regulations. Not even close to "all".
api 2 hours ago [-]
“All” is doing a lot of work there.
Also there are real trade offs. Food would be cheaper if, for instance, it were legal to cut it with any old cheap substance regardless of health effects.
But I totally agree that some regulations are dumb or are regulatory capture monopoly schemes.
Unfortunately like many other things there is no absolute simple rule to save us from thinking. Each case must be evaluated in depth hopefully with domain expertise.
gamblor956 2 hours ago [-]
That's wrong, but why let reality get in the way of a pithy ideology?
Government regulations exist to regulate activity, to prevent, punish, and/or remediate harms.
Environmental regulations exist because businesses wouldn't clean up their own messes. Financial regulations exist almost exclusively because of harms and abuses committed by members of the financial industry. Building codes are updated to reflect lessons learned about people died, to prevent more people from dying the same way.
If AI regulations are passed, it will be because the AI industry decided not to self-regulate itself and stop illegally hacking computer systems, generating CSAM, or various other illegal activities that should easily be preventable if their systems were actually intelligent.
332451b 1 hours ago [-]
DeepSeek claims $38 of revenue per GPU, per hour for Flash V4. That is $332,880 per GPU, per year. This matches their DeepInfer numbers: 25,600 output tokens/s per GPU sold at $0.60 per million -> $55 minus some other overhead to arrive at $38.
For the bigger Anthropic and OpenAI models (and associated higher prices) there are many unknown factors. But presumably they also work hard on optimizations, and it's not so crazy to think they had or still have a lot of wiggle room to adjust prices.
smallmancontrov 1 hours ago [-]
Yes, but DeepSeek went absolute goblin-mode on optimization and I would not be shocked to discover that OpenAI and Anthropic were behind on that front.
Art9681 39 minutes ago [-]
OpenAI and Anthropic have more compute and the best frontier models to throw at the optimization problems. They have published articles on these efforts. For example, Dots, and Anthropic's upcoming "persistent agent" is because of these optimizations. Both companies often publish articles detailing a lot of their technical efforts. They just get buried among the flood of other news.
cactusplant7374 1 hours ago [-]
What is the TPS of DeepSeek? All of the LLMs I have tried are slow as molasses. \
micw 1 hours ago [-]
I use TensorX (EU hosted) and get 330TPS
epsteingpt 52 minutes ago [-]
Because there's limited demand, and GPU capacity is like airline seats use it or lose it.
This will only get worse.
trescenzi 9 minutes ago [-]
At the end the author briefly contemplates this:
> One outcome that would be genuinely ironic is that if these models are more compute efficient, it reduces the need for these massive data center buildouts, which could cause cascading economic failures. However, that likely won’t happen since inference is only one part of the compute mix and those data centers are still needed for other parts of the pipeline.
Don’t agree with the however. I think like you’re saying we’re going to get to see in real time what happens when something is commoditized and it gets massively overbuilt.
skhameneh 53 minutes ago [-]
Well they did pull back on ZDR a few times and at least Anthropic has made their arguments (that I disagree with) that model outputs, no matter how much user context was fed, do not fall under their definition of "user data".
Are these prices subsidized by user generated outputs?
Can I even trust any answer to not be carefully worded and rephrase the response to "user data"?
Even so, what's to prevent some "oops" event that seems to be all too common?
At least some months back Bedrock seemed to be properly isolated, but I've heard of many getting non-ZDR notices for new models.
chakintosh 3 hours ago [-]
It’s a race to the bottom to see who blinks first and goes bankrupt. It’s not sustainable.
trollbridge 3 hours ago [-]
Is it? DeepSeek has already proved they’re selling inference at a profit.
Art9681 38 minutes ago [-]
DeepSeek hasn't proven anything except what they say. You're inherently trusting a company's statements over others. When an independent third party corroborates the numbers then we know for sure. Until then, every company is just selling a story for investors and users.
epolanski 28 minutes ago [-]
I'm not aware of Chinese law, but I suspect that lying to the public or investors carries risks.
bakugo 29 minutes ago [-]
Does DeepSeek offer a heavily subsidized subscription that provides 20x+ more usage than the equivalent value in API tokens?
API usage being profitable is completely plausible, but almost nobody pays API prices for Claude and GPT, nor would they be able to afford them if the subscription suddenly stopped existing.
holoduke 3 hours ago [-]
Not DeepSeek themselves, but their open models are run by third-party companies in a profitable way. The unsustainable interference theory has been debunked.
written-beyond 2 hours ago [-]
Define profit? If by profit you mean covering compute costs then yes you're correct. If by profit you mean covering spent RnD budget and future RnD budget allocations then no, by no means are any of these AI companies running at a profit.
Also these third-party providers are running magnitude smaller models than what Anthropic and OpenAI's power users expect from them. Yes the average chat message isn't being routed to the 1+ Trillion param model but people running CC or Codex on Ultra probably are. Those are objectively more expensive.
chrisXOXO 2 hours ago [-]
I am citing out of my head here, but think deepseek’s inference engine with their models create around 30 dollars per hours while it costs around 4 dollars, there might be other costs but if you look at the demand, it will become very profitable.
I don’t understand why people are pessimistic about the profitability (I don’t want them to be this successful either). BUT why would they care about profitability right now. They believe in AGI, so do the big money people. They get their investments. This train is not stopping and I believe their predictions are correct (IMO we should not debate about timescales apart from spreading urgency).
And for the lowering of prices, it is possible because they just can and hooking people now into their systems will be 10x more profitable in the future. In addition to all the juicy training data they get with real world clients.
They are scared the others win, they are not scared that they run out of money.
written-beyond 58 minutes ago [-]
I got our pocket god ChatGPT to fact check this discussion. No lab is profitable, it is a moonshot to expect they'll ever recover the billions frontier labs have put in behind these DCs. I never understand this argument everyone tries to make, AI is too expensive -> It will get cheaper as they scale -> AI is too cheap and not sustainable -> No it's very profitable on API -> go back to 1.
I am not an AI denier, I use it and I find it very useful. That said I can disagree with the current economics of the industry and their business model.
1 hours ago [-]
Art9681 36 minutes ago [-]
They are selling inference at severely gimped capability. Even in openrouter the quality and speed of the model being served varies by provider. When you dig into the details (which most people don't do), not all providers are equal.
krainboltgreene 2 hours ago [-]
The conditions for DeepSeek's profitability are very very narrow. A key piece being that they have cheap energy, a second key is that they have west/east clients and thus extremely high uptime.
ipsum2 1 hours ago [-]
This is not correct. Their margins are extremely high, (~1000%), and none of the factors you listed would cause them to have negative margins.
bhu8 3 hours ago [-]
It’s probably more efficient caching methods and smaller models (6 sol is actually 6 terra and opus 5.5 is smaller than 5.1 etc). Don’t overthink this please
maxdo 2 hours ago [-]
It’s both competition almost 3 way , cheaper open source , a clearly lagging behind a bit open ai that cuts prices to win Anthropic customers .
There was an interesting technical advantage by some models where Anthropic as a leader start loosing dramatically in speed too. 5.5 made a come back in that dimension.
nickhodge 19 minutes ago [-]
Microeconomics may give us a clue
Lack of demand and/or commodity product.
Either doesn't bode well for a multi-trillion dollar valuation for either company.
jameson 1 hours ago [-]
competition. that's good for consumers.
though problem with proprietary LLMs it's difficult to know if the vendor's supposed "optimization" affects performance negatively because it's difficult to define an SLA
hauntingseaweed 4 hours ago [-]
Price war. Duh. There is no moat. Also them chinese competition. It’s going to be race to the bottom. It’s gonna be ugly for the stock market. Good for consumers though!
cactusplant7374 1 hours ago [-]
The moat is high TPS. No one has rolled it to average consumers though.
SugarReflex 4 hours ago [-]
Can they do the same thing with fuel prices?
dymk 3 hours ago [-]
Solar panels (which continue get cheaper every year) on my house makes charging my low-TCO EV free in 5 years
elmer2 2 hours ago [-]
Until you start getting taxed.
dymk 2 hours ago [-]
How do you figure that works?
Supermancho 1 hours ago [-]
Solar panels added to a grid is not plug and play.
When you're connecting solar to a municipal grid (which is what most homes are connected to), it could theoretically be taxed or even subjected to a tariff. The "added" power (often excess) is monitored for billing credits/payout/other, among other reasons like grid integrity.
iAMkenough 39 minutes ago [-]
Voters vote for Republicans that drive up TCO for EVs, like higher annual registration fees.
dwattttt 3 hours ago [-]
If you make it easy for lots of people to make the fuel, yes. EVs and smaller scale power generation anyone?
verdverm 2 hours ago [-]
That would likely require innovation in a renewable liquid fuel that can work at scale.
Electrification will drive the demand for oil down, making the overhead more expensive per gallon, and eventually we will largely move off of fossil fuels, though I don't expect completely. It will be many decades due to the turnover times for industrial/commercial transportation systems.
YetAnotherNick 3 hours ago [-]
Yes if China somehow gets the fuel and subsidize it to sell it for cheaper in the global world, even the gulf state price will go down.
rico735 2 hours ago [-]
Doubt the race to the bottom is really good for consumers, unless you actually just want more stuff rather than better stuff. The bubble bursting is going to be pretty horrible financially for us all.
The main thing it seems to have done so far is made everything feel less trustworthy, and everything digital less safe. It has empowered scammers, that's for sure.
And for what benefit? Spunking out 7/10 code a bit faster with your brain turned off. Great!
3eb7988a1663 4 hours ago [-]
Just wait until the government ban on the dangerous open models materializes.
chasd00 2 hours ago [-]
It won’t be a ban, it will be some “certified safe” badge from a federal agency. Companies will be scared into not using anything that is not “certified safe” and business insurance will even require it. Whoever (openAI or Anthropic) gets to the politicians first will be the only certified safe model provider.
Maybe the FDA is a good analogy, you wouldn’t want to buy meat at the store not FDA certified would you? OpenAI and Anthropic want you to feel the same about AI.
ern 1 hours ago [-]
I'm not an American, but I thought the FDA didn't certify stores
pixl97 3 hours ago [-]
Not just models, won't be long before hardware is regulated too.
shwaj 2 hours ago [-]
Sounds like an eventual Supreme Court case.
verdverm 3 hours ago [-]
I do not expect an outright ban. (1) the bots are too useful, open is the way, re: HF handling the incident (2) you can train without certain capabilities, see Kimi K3.1 (3) reminiscent of the encryption is dangerous debate of the '90s
There will likely be requirements like registering with the government (China already does this, every business already does everywhere), certain usages require more or have deeper regulations (this is already done with most technologies, depending on application)
3eb7988a1663 3 hours ago [-]
I think it will not technically be a ban, but a de facto one.
Some variation on, "Open weight models must be A) trained in the USA B) have a public training dataset + training pipeline C) be reviewed by a government 'safety council', etc" Something which technically leaves a crack open for someone to release a less capable model than the commercial ones.
verdverm 3 hours ago [-]
That kind of policy will hold a country back, and why I don't think it will happen. There are already many companies already using Chinese models.
Another confounding factor, if a US company fine-tunes a Chinese model, or vice versa, what is that country that should be assigned to that model.
You also have to consider the competition between the US and China. If the US did something like this, the world will move to Chinese hardware and Ai. The think tanks that talk with legislators understand this.
3eb7988a1663 2 hours ago [-]
You have more faith than I do. It would be bad policy, but hardly a first for a government who wielded tariffs like a cudgel in spite of obvious repercussions.
verdverm 2 hours ago [-]
There are people in Trump's inner most circle that know this. I'm not worried about it. People trust those calling for regulatory capture (Dario / Altman) the least. (HN is not a good representation of the general population and AI userbase)
paxy 3 hours ago [-]
Because they have been making inference a lot more hardware efficient.
julianlam 5 minutes ago [-]
By using Chinese research
verdverm 4 hours ago [-]
I fully expect token vendors to go the way of mobile data providers. Increasing throughput and efficiency, yet commoditized and not reaping the massive rewards of the economic gains their technologies enable.
Can't wait for the unlimited plans we will have in due time.
Iolaum 4 hours ago [-]
They will not come. You can only spend so much time speaking on the phone.
But if you get unlimited tokens, with scheduled/automated jobs and subagents you will burn a LOT of money.
Skunkleton 4 hours ago [-]
"Unlimited" for a consumer will probably take a form like limited parallel agents at max intelligence for X amount of tokens, followed by either single threaded agents or nerfed intelligence or both.
This is the same mechanism used in unlimited mobile internet for example.
cicko 3 hours ago [-]
I rarely use more than 25% of my subscription's weekly allowance. So, it's already unlimited.
JumpCrisscross 4 hours ago [-]
> if you get unlimited tokens, with scheduled/automated jobs and subagents you will burn a LOT of money
Maybe, maybe not. There could be a saturation point of compute demand from ordinary consumers. (See: hot-water analogy.)
ModernMech 4 hours ago [-]
> You can only spend so much time speaking on the phone.
Tell that to my dial up modem as I played Active Worlds in 1996.
boredatoms 4 hours ago [-]
Yeu were still limited to about 4GiB/month usage as a time/bandwidth ceiling
verdverm 3 hours ago [-]
Not where I am, it's 20G mobile and internet is unlimited, the level below mine has 1Tb cap.
Philpax 2 hours ago [-]
The parent poster was talking about the amount of data transfer you could do on dialup over a month in 1996.
verdverm 4 hours ago [-]
Mobile video data and tethered devices would tell a different story. Usage growth has been significant.
I expect they will be "unlimited" in the same sense the mobile / ISPs do that 99% of people never reach the limits.
We could have "unlimited" electricity too, if we choose, by printing solar panels (like the Chinese) and hopefully fusion before long.
bikvfeee 4 hours ago [-]
> Can't wait for the unlimited plans we will have in due time.
I don't see how this can happen. The cost of serving a model grows linearly with use (energy). The cost of serving a mobile data plan is approximately zero.
verdverm 3 hours ago [-]
> The cost of serving a model grows linearly with use (energy)
The cost of processing tokens however does not. Throughput and efficiency are improving around 10x per year. Hardware is not the only factor.
criemen 3 hours ago [-]
I'm curious, why would this not turn into an unlimited electricity flatrate? In most parts of the world, consumer electricity is charged by kWh, not as flat payment.
As long as tokens are as energy intense to compute as they are right now, I don't see a flatrate being a viable model.
pixl97 3 hours ago [-]
Power and memory are apt to become the biggest billing constraints.
verdverm 3 hours ago [-]
Something close to how we rent other cloud resources today makes sense. We don't worry about electricity costs, it's built into the hourly prices, use as much of the hardware as you can. Electricity rates vary over the course of the day as well.
People don't like complex pricing. This would be for businesses running larger workloads. For individuals, the unlimited plan seems the most probable to me. This stuff is going to get real cheap in the coming years.
The energy needed per token is in dropping rapidly, even though the energy per-GPU is going up. We are seeing something like 10x improvements per year.
Alex13192 1 hours ago [-]
[flagged]
prjkt 3 hours ago [-]
They're competing with NVIDIA (huggingface)
gum_wobble 4 hours ago [-]
Because they have found a way that cost them less to have you use a lesser capable model o less expensive
This is literally just some rando blogger’s (overconfident) theory.
Kuyawa 3 hours ago [-]
Duh, China?
verdverm 3 hours ago [-]
We also see improvements like 7x between the current and last Google TPU generations, with different chips for training vs inference.
dez11de 3 hours ago [-]
Moore’s Law.
Starlevel004 3 hours ago [-]
> It turned out that GPT-6 Sol was a dud performancewise, so a week later OpenAI announced GPT-6.1 Sol,
I strongly believe that GPT-6 Sol was only ever meant to be the web chat model, but it was a panic public release to respond to Opus 5.5. It's clearly been over fitted for drawing diagrams in the chat.
deadbabe 3 hours ago [-]
People think OpenAI and Anthropic are just these wildly unprofitable companies with no future or business.
They know what they’re doing. The naysayers are like the people that said this little internet thing wasn’t going anywhere.
Loocid 1 hours ago [-]
>They know what they’re doing. The naysayers are like the people that said this little internet thing wasn’t going anywhere.
There's a big difference between people saying OpenAI/Antropic wont survive and LLMs wont survive. A lot of big early players in the internet space died off as well.
lhd1 3 hours ago [-]
Whether you think they have a future or not does not change fact that they currently are wildly unprofitable.
>internet thing wasn’t going anywhere.
This is conflating the utility of the technology with the economics behind it. Few people claim LLMs are useless. It's a question of figuring out a viable business model.
wswx 3 hours ago [-]
correct.
Commercial airlines are of great value to our lives. Who's questioning or denying that?
Horrible business to be in though.
tonyhart7 2 hours ago [-]
Yeah, I think AI model provider would goes the same way commercial airlines does
the money is infrastructure (hardwares, electrics, data etc)
root_axis 1 hours ago [-]
> The naysayers are like the people that said this little internet thing wasn’t going anywhere.
The same rhetorical tactic was used to diminish blockchain critics.
rico735 2 hours ago [-]
Might want to Google Global Crossing.
The internet survived, but most giant companies did not.
shooly 3 hours ago [-]
It sounds like you're just a "yessayer", though? Not much different from naysayers, just on the opposite side.
One thing that naysayers have going on for them is the fact that those companies indeed aren't making profit right now.
deadbabe 1 hours ago [-]
People get obsessed with wanting companies to profit ASAP.
That's not how you grab market share. Early on, any profit you aren't reinvesting into the business is basically hurting your growth rate.
wswx 3 hours ago [-]
So did the bankers in 2008.
Crazy how delusional people are.
They are in too deep - they have to believe it all works out and act accordingly. lmao.
quater321 1 hours ago [-]
[dead]
Rendered at 01:29:44 GMT+0000 (Coordinated Universal Time) with Vercel.
The frontier labs were already burning money on more expensive price models, and competition wouldn't have reduced their capex proportionately.
They could also continue to grow at the rates they had last year. I don't know where those customers would come from, but if they did pull that off OpenAI and Anthropic could sustain propping up the circular financing going around the AI industry.
This is comparable to how, if I sign a 12 month non-cancelable lease and then don’t pay the rent, I will be in debt to my landlord.
Their data from September is leaked via IPO preview, and October is not yet complete, so how can someone even project that?
// I am a techie, not a finance guy, so apart from public chatter, no inside knowledge.
And I do feel their IPO is being rushed before anyone has enough information to make up their mind. The VCs or private equity have given them a lot of money and want to cash out. When the revenue does slow down, any investor should pause to take a look at whether they can right the ship, or has the landscape itself changed.
If we assume it's due to competition, then their usage has precisely not plummeted because they cut prices by 80%.
The US absolutely could (and very well might) make Chinese models illegal, possibly open weight models in general, but all that will do is keep them out of the hands of law abiding US citizens.
Law breakers in the US and the entire rest of the world would still have access, and nothing in the US will be any safer. People who think regulation will solve the problem should be embarrassed by their ignorance.
"Puncture expectations of a multi-trillion dollar valuation" OTOH seems quite likely to me.
However, capability could plateau or reach a point where most of the market can't tell the difference and isn't willing to pay a premium.
Kimi K3.1 is top 5 on AA and half the price of Opus 5.5, Qwen4 is coming soon. There is near zero difference for most tasks, so it matters less today and even less as time goes on. Price is now the top concern for a reason.
https://artificialanalysis.ai/#intelligence
You and I obviously can just use a VPN, but 99% of usage is likely as part of a company.
Is there precedent for the US actually "banning" software? I know for example the Kaspersky ban and tiktok ban, but both of those were either banning the sales or banning the service. IIRC neither made the actual software illegal.
What is an example of a specific software being illegal to possess? What is an example of a specific software being illegal to use if it is not used to break other laws (copyright, etc.) or talks to banned service providers?
Closest thing I can think of is restricting the export of cryptography in the 90's, but that was not even close to what you are suggesting.
It's nice because I can keep going from anywhere, other team members can see and interject in my Slack threads, and Hermes auto updates its skills with any adjustments that we make so we don't have to ask twice.
However, Anthropic is pickier about the harnesses you can use with Claude Code and I noticed discrepancies when using Zed's External Agent feature with Claude Code, so I just use the Claude app. It's fine.
And I’m slowly writing my own. But it’s garbage at the moment.
I’m writing my own harness to learn. And I’m writing it in zig.
But, I’ll absolutely add maki.sh to my reading list. So, that’s a win.
At home, I mostly use openrouter.
A few bucks will realistically last you forever. I also bought a DGX Spark at launch. I've learned a ton. but it's not usually my daily driver. I do run overnight tasks on it, like "read this book and write up notes on each chapter..."
In retrospect, given the dirt cheap prices of apis and or renting hardware, buying hardware for inference was likely a mistake (but not enough of a mistake to sell it now).
No, they are losing billions because LLMs are not a viable business. Their real business is making bombastic statements which the credulous press prints unquestioning, fooling various investors and ... that's it. IPO is another of these. You really should note how the Anthropic IPO date keeps slipping because they can't make the S-1 public as it would give away the game immediately. The market was fooled by SpaceX once you can't do this a second or third time.
Inference is clearly profitable. The question is whether it's profitable enough to justify the training research costs.
Regulation might inconvenience them a little, but the upside is huge if it means open models out of China get banned.
Given everything happening with Black October[0], don't you think regulating models may be reasonable?
[0] https://en.wikipedia.org/wiki/Black_October_(information_sec...
They are meant to help the consumer.
Unfortunately neither of the two parties in the US even pay lip service to free markets anymore.
You can as long as you can saturate hardware with profit that makes up for training costs (which are also in free fall).
Anthropic is most at risk since they haven't bought any hardware (afaik), however OpenAi is building custom silicon now. The rest of Mag7 are primarily hardware vendors
https://mimo.xiaomi.com/rl/
Also look to the history of stable diffusion
You cannot point at Xiaomis tiny model and compare it to training a 10T param model. The levels of dunning krueger are getting out of hand.
You also arent calculating the salaries of the people involved, of which there's only a few thousand worldwide in your hiring pool.
Yet, so many Democrats support it.
In the hands of 6th party system Republicans, namely Ronald Reagan and Robert Bork, the government worked hard to usher in a a new era of Robber Barons. We live in the culmination of this project.
History says the result depends on the hands, not the tool. 6th party system Democrats have largely failed to undo the Reagan/Bork policies, but that's an act of omission not comission and even then Lina Khan was a big step in the right direction. This issue was on the ballot in 2024 and will be again in 2028. Hopefully we make better choices in 2028.
Also there are real trade offs. Food would be cheaper if, for instance, it were legal to cut it with any old cheap substance regardless of health effects.
But I totally agree that some regulations are dumb or are regulatory capture monopoly schemes.
Unfortunately like many other things there is no absolute simple rule to save us from thinking. Each case must be evaluated in depth hopefully with domain expertise.
Government regulations exist to regulate activity, to prevent, punish, and/or remediate harms.
Environmental regulations exist because businesses wouldn't clean up their own messes. Financial regulations exist almost exclusively because of harms and abuses committed by members of the financial industry. Building codes are updated to reflect lessons learned about people died, to prevent more people from dying the same way.
If AI regulations are passed, it will be because the AI industry decided not to self-regulate itself and stop illegally hacking computer systems, generating CSAM, or various other illegal activities that should easily be preventable if their systems were actually intelligent.
For the bigger Anthropic and OpenAI models (and associated higher prices) there are many unknown factors. But presumably they also work hard on optimizations, and it's not so crazy to think they had or still have a lot of wiggle room to adjust prices.
This will only get worse.
> One outcome that would be genuinely ironic is that if these models are more compute efficient, it reduces the need for these massive data center buildouts, which could cause cascading economic failures. However, that likely won’t happen since inference is only one part of the compute mix and those data centers are still needed for other parts of the pipeline.
Don’t agree with the however. I think like you’re saying we’re going to get to see in real time what happens when something is commoditized and it gets massively overbuilt.
Are these prices subsidized by user generated outputs? Can I even trust any answer to not be carefully worded and rephrase the response to "user data"? Even so, what's to prevent some "oops" event that seems to be all too common? At least some months back Bedrock seemed to be properly isolated, but I've heard of many getting non-ZDR notices for new models.
API usage being profitable is completely plausible, but almost nobody pays API prices for Claude and GPT, nor would they be able to afford them if the subscription suddenly stopped existing.
Also these third-party providers are running magnitude smaller models than what Anthropic and OpenAI's power users expect from them. Yes the average chat message isn't being routed to the 1+ Trillion param model but people running CC or Codex on Ultra probably are. Those are objectively more expensive.
I am not an AI denier, I use it and I find it very useful. That said I can disagree with the current economics of the industry and their business model.
There was an interesting technical advantage by some models where Anthropic as a leader start loosing dramatically in speed too. 5.5 made a come back in that dimension.
Lack of demand and/or commodity product.
Either doesn't bode well for a multi-trillion dollar valuation for either company.
though problem with proprietary LLMs it's difficult to know if the vendor's supposed "optimization" affects performance negatively because it's difficult to define an SLA
When you're connecting solar to a municipal grid (which is what most homes are connected to), it could theoretically be taxed or even subjected to a tariff. The "added" power (often excess) is monitored for billing credits/payout/other, among other reasons like grid integrity.
Electrification will drive the demand for oil down, making the overhead more expensive per gallon, and eventually we will largely move off of fossil fuels, though I don't expect completely. It will be many decades due to the turnover times for industrial/commercial transportation systems.
The main thing it seems to have done so far is made everything feel less trustworthy, and everything digital less safe. It has empowered scammers, that's for sure.
And for what benefit? Spunking out 7/10 code a bit faster with your brain turned off. Great!
Maybe the FDA is a good analogy, you wouldn’t want to buy meat at the store not FDA certified would you? OpenAI and Anthropic want you to feel the same about AI.
There will likely be requirements like registering with the government (China already does this, every business already does everywhere), certain usages require more or have deeper regulations (this is already done with most technologies, depending on application)
Some variation on, "Open weight models must be A) trained in the USA B) have a public training dataset + training pipeline C) be reviewed by a government 'safety council', etc" Something which technically leaves a crack open for someone to release a less capable model than the commercial ones.
Another confounding factor, if a US company fine-tunes a Chinese model, or vice versa, what is that country that should be assigned to that model.
You also have to consider the competition between the US and China. If the US did something like this, the world will move to Chinese hardware and Ai. The think tanks that talk with legislators understand this.
Can't wait for the unlimited plans we will have in due time.
But if you get unlimited tokens, with scheduled/automated jobs and subagents you will burn a LOT of money.
This is the same mechanism used in unlimited mobile internet for example.
Maybe, maybe not. There could be a saturation point of compute demand from ordinary consumers. (See: hot-water analogy.)
Tell that to my dial up modem as I played Active Worlds in 1996.
I expect they will be "unlimited" in the same sense the mobile / ISPs do that 99% of people never reach the limits.
We could have "unlimited" electricity too, if we choose, by printing solar panels (like the Chinese) and hopefully fusion before long.
I don't see how this can happen. The cost of serving a model grows linearly with use (energy). The cost of serving a mobile data plan is approximately zero.
The cost of processing tokens however does not. Throughput and efficiency are improving around 10x per year. Hardware is not the only factor.
As long as tokens are as energy intense to compute as they are right now, I don't see a flatrate being a viable model.
People don't like complex pricing. This would be for businesses running larger workloads. For individuals, the unlimited plan seems the most probable to me. This stuff is going to get real cheap in the coming years.
The energy needed per token is in dropping rapidly, even though the energy per-GPU is going up. We are seeing something like 10x improvements per year.
I strongly believe that GPT-6 Sol was only ever meant to be the web chat model, but it was a panic public release to respond to Opus 5.5. It's clearly been over fitted for drawing diagrams in the chat.
They know what they’re doing. The naysayers are like the people that said this little internet thing wasn’t going anywhere.
There's a big difference between people saying OpenAI/Antropic wont survive and LLMs wont survive. A lot of big early players in the internet space died off as well.
>internet thing wasn’t going anywhere.
This is conflating the utility of the technology with the economics behind it. Few people claim LLMs are useless. It's a question of figuring out a viable business model.
Commercial airlines are of great value to our lives. Who's questioning or denying that?
Horrible business to be in though.
the money is infrastructure (hardwares, electrics, data etc)
The same rhetorical tactic was used to diminish blockchain critics.
One thing that naysayers have going on for them is the fact that those companies indeed aren't making profit right now.
That's not how you grab market share. Early on, any profit you aren't reinvesting into the business is basically hurting your growth rate.
Crazy how delusional people are.
They are in too deep - they have to believe it all works out and act accordingly. lmao.