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by dvt1 days ago |
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upvoteby nl1 days ago|
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> And to be clear, OpenAI/Anthropic most definitely know this: that's why they've been aquihiring like crazy, trying to find that one team that will make the thing.

Anthropic is up to $30B annual recurring revenue. I wish I had failing business models like that.

> Token prices are significantly subsidized and anyone that does any serious work with AI can tell you this. Go use an almost-SOTA model (a big Deepseek or Qwen model) offered by many bare-metal providers and you'll see what "true" token prices should look like.

I'm not sure what think you are saying here, but if you look at the providers for both "almost-SOTA model (a big Deepseek or Qwen model)" or at the price for Claude on AWS Bedrock, Azure or on GCP you will quickly see inference is very profitable.

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upvoteby monooso1 days ago|
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> Anthropic is up to $30B annual recurring revenue. I wish I had failing business models like that.

And profit? A company can have $300B annual revenue, and still be a failing business if it's making a loss.

Somewhere along the line we seem to have forgotten this basic fact. Eventually there will be no more rounds of funding to feed the fire.

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upvoteby nl18 hours ago|
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Anthropic has raised $64B in total since they were founded.

Even if you say we are going to measure profit in the very special hacker news way of looking at money taken in from customer revenue against money invested and we say they can't do things like counting building data centers or buying GPUs as capital expenses and instead have to count them against profit then in 2 years time they will have made more money than they have taken in investment.

That is extraordinary.

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upvoteby tempaccount42022 hours ago|
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Costs can always be optimized, revenue is much harder to optimize.
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upvoteby ReptileMan23 hours ago|
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It is easy to get 30B when you resell something you buy for 50B
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upvoteby usef-19 hours ago|
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The proverbial "50B" is investment in next year's model. The current model cost under "30B", and therefore "is profitable". It is a bet on scaling, yes, but that's been common throughout the industry (see, eg, Amazon not being profitable for many years but building infrastructure)
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upvoteby usef-11 hours ago|
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Also see the Dario interview with Dwarkesh:

> If every year we predict exactly what the demand is going to be, we’ll be profitable every year. Because spending 50% of your compute on research, roughly, plus a gross margin that’s higher than 50% and correct demand prediction leads to profit. That’s the profitable business model that I think is kind of there, but obscured by these building ahead and prediction errors.

(a lot more at the link)

https://www.dwarkesh.com/p/dario-amodei-2?open=false#%C2%A70...

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upvoteby ReptileMan19 hours ago|
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Except the rumors are they subsidize even the inference, not that they have capex in training.
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upvoteby nl18 hours ago|
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The maths shows inference is very profitable. Look at how Google/AWS/Azure change the same rates as Anthropic does for running Claude models.
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upvoteby dvt13 hours ago|
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You're missing the forest for the trees. Per-token pricing is irrelevant when you're just trying to get shit done. I pay 20 bucks a month for OpenAI, but I use likely $200+ a month of tokens just on the coding (and I'm just looking at the raw tokens, this is ignoring all the harnessing on their end). Even OpenAI has said that they're losing money on the 200-dollar subscriptions[1]. This is not a viable business model. Why do you think they are introducing ads this year[2]?

[1] https://fortune.com/2025/01/07/sam-altman-openai-chatgpt-pro...

[2] https://openai.com/index/testing-ads-in-chatgpt/

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upvoteby stavros22 hours ago|
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> Go use an almost-SOTA model (a big Deepseek or Qwen model) offered by many bare-metal providers and you'll see what "true" token prices should look like.

Qwen3.5-122B-A10B is $0.26 input, $2.08 output. Where's the subsidy? It's ten times cheaper than Opus. Or did you mean that we're subsidizing their training? But then "OpenClaw token-vomit on top of Claude is fiscally untenable" makes no sense.

Yeah, I don't know where you got your costs from. Bare metal providers are significantly cheaper than Anthropic.

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upvoteby usef-19 hours ago|
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Maybe he's comparing the renting price of a bare metal server on its own, and doesn't realise how drastically cheaper they are to batch together for an API provider.
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upvoteby 19 hours ago|
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