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by bmurphy19762 hours ago |
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upvoteby Jagerbizzle2 hours ago|
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"leveraging their infra" is a pretty solid play, considering the scope of investments these two companies have made thus far.
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upvoteby jackb40402 hours ago|
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It does however totally abandon the question of making a profitable mass-market AI product upon which the scale of those investments was based.
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upvoteby thewebguyd50 minutes ago|
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Not entirely, if models become commodity, then Microsoft's play as an infrastructure & enterprise apps company is the better bet. They don't need to make profitable mass-market AI models, they just need the best tooling on top of any model their customers pick, remaining fully model agnostic.

"AI Product" doesn't necessarily mean "We sell API access to a our models." Ton of companies out there itching to buy a commercial off the shelf product to deliver whatever AI capabilities they need packaged in a nice GUI, with enterprise governance controls, without needing a dev team/team of engineers to integrate it or develop harnesses, etc.

Buy it->have IT click a few buttons in an admin console->Deploy and have it be immediately useful is the play.

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upvoteby jackb404039 minutes ago|
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AI services becoming a commodity by definition means that the price will hover around cost to operate. That's just what commoditization means in tech. Free, as in Google creating a free browser for no profit in order to increase the size of their ad market.

The entire justification for the AI buildout, and the valuations of all the major AI labs, is that the service will be priced at some significant fraction of the knowledge work it's replacing. If you think it will become commoditized in the future, you are saying these companies are significantly overvalued at present.

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upvoteby thewebguyd26 minutes ago|
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> you are saying these companies are significantly overvalued at present.

I do lean toward them being significantly overvalued at present. OpenAI & Anthropic's valuations assume high margin product pricing on raw intelligence itself. Even if assume the labs will start charging value-based pricing, enterprise buyers will pay that pricing to whoever saves them engineering hours to make any cheap model work inside their compliance boundary, no guarantee that's going to be OpenAI or Anthropic.

Microsoft wins either way, proprietary, expensive models or cheap commoditized inference, because they monetize the workflow on top, not the raw intelligence. I also happen to think it's everything "on top" where a lot of value lives. Plenty of non-tech enterprises and companies out there itching for a ClickOps style AI product, especially if they don't have an engineering team, that they can buy off the shelf, meets all the compliance checkboxes, and does what they need without having to build the agents and harnesses themselves with the APIs.

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