People crying about the revenue gap constantly forget that OpenAI still hasn't turned on the ads, porn, and gambling. Trust, they will turn it on eventually.
Why would OpenAI have any sort of advantage in these industries compared to the established players?
it's pretty sobering to think that the so-called harbingers of SkyNet AGI have to fall back to mafia-era revenue streams like vice to convince shareholders that their money wasn't wasted.
I am suspect that ads will be able to cover the cost of inference, much less model building, salaries, product development, etc. The ad industry is built upon _and priced for_ websites that return results for virtually zero cost. That isn't going to be true for rendering AI.
Define "attracted". I believe porn and gambling both do incredible amounts of damage to society. Ads probably do some damage to society, though I can recognize some benefits in being able to advertise and market products and services. I don't believe there is any benefit to the other two.
HSBC, the firm who did the analysis in the article, took into account projected revenues matching user numbers of 44% of the world's non-Chinese population.
44% for OpenAI wouldn't mean 0% for Google, but considering that even Apple only has about 30% of the global smartphone marketshare, OpenAI getting there seems unlikely.
> People crying about the revenue gap constantly forget that OpenAI still hasn't turned on the ads, porn, and gambling
But quite the opposite, HSBC assumed that they will have a virtual global monopoly on AI, and even under those projections they will still need to take on hundreds of billions of debt. I'm sure if they get there getting access to that debt will be easier than I'm assuming currently.
I think that a company with a global monopoly on a thinking machine that replaces wide swaths of current internet business categories, whose user base makes up most of the world outside of the GFW, would be very valuable on the public market and would probably have access to as much debt as they want, even if it had negative consequences for the world economy. Even the 2nd or 3rd place company in that race will be quite profitable. It's not impossible, just implausible.
That is exactly the parent's point, that while those things could bring in revenue, the competition in those industries is already incredibly fierce. And that's before potential new entrants into the space on the AI front. Even in the best of cases I don't think anyone is gonna be able to pull anything other than middling margins.
I'm not saying they should or will give up on these markets, just that their margins aren't likely to be great.
There's already so much AI porn right now. There's no reason to believe that OpenAI will be any better or able to command higher margins than their competitors. They also
have the problem of being under a ton of public and regulatory scrutiny so the highest paying clientele, the people with niche unsavory fetishizes, won't be able
to be serviced by them.
And that's ignoring the fact that getting into this space at all is pure HN speculation and unlikely to ever happen anyway.
This is absolutely what techbro MBAs raised on case studies of Apple and Toyota are likely to think. Gamblers and porn users do not have any sort of brand loyalty and are likely to be hostile to the idea of "vertical integration" and "360 degree views of the customer".
They may not be shipping good enough products, but on the flip side it still feels like they have almost no competition outside of coding and image gen. The EOL termination of 4-o should be some evidence of this.
OTOH, why don't they ship good enough products? To me all of OpenAIs recent investments strongly suggest they hit a dead end with their current LLM approach. After all, if they knew the path ahead for GPT looks great, why don't they invest into training the next big thing instead of doing datacenters with the intention of renting them out?
I think you're right, however that only defeats themselves in the long run. AI is something that can be run locally, while search, shopping, movies, social, etc. cannot. And once the ads are baked into the product, you will need a force like the EU to remove them else shareholders will riot. Ads will be the perfect weapon to shoot themselves in the foot.
Ok, probably true, but it’s still a pretty far fall from “we’re just about to deliver AGI which will put us in the driver seat of the entire global economy.” Which was the core value prop of their $trillion investment pitch. Like, there are way cheaper ways to deliver ads, porn, and gambling than training and operating huge LLMs.
The cost per generation is still too expensive, they would not profit from ads and very few people pay for porn. I don't see how they'd profit from gambling either.
(Imo) They will turn to all of these(especially to porn and gambling) when the core model of "enhance your life" will slowly fade away. The "academia space", the teens/boomers demographics, all of those will stop using OpenAI at scale if they're bombarded with vices (porn, gambling, etc).
Ads & referrals are already in the works, and people are generally tolerant of those. But, as with any company, appearances matter. ChatGPT will definitely lose users at the slightest possibility of having non-sanitized content served to more morally sensible groups.
