These Chinese models cost less of US SOTA models to run, even if they are less capable. Providers can just run them, offer cheap tokens, and pocket the margin.
I just don't see how you justify a trillion valuation for US AI labs when the underlying models are being commoditized this fast.
Whether AI works or is useful or not isn’t even the question anymore. It can fulfil every promise Sam Altman has been making and will still make no financial sense to justify these valuations.
In summary, regardless of country of origin, availability of inference capacity is the moat protecting the likes of OpenAI and Anthropic, not technology superiority.
[1] https://www.fredgao.com/p/deepseeks-liang-wenfeng-breaks-his
It only justifies their long term valuations if they can leverage that temporary monopoly for technological superiority (they can't) or lasting market share (they can't).
Chinese models prove there's no technical advantage, and the software side is heavily commoditized so there's not much advantages to market share either.
The very exponential that you are relying on to give you runaway improvement is also giving exponentially increasing data to your competitors. All else being equal your competitors stay a step behind but you never develop a monopoly either. That's the best case for Anthropic/OpenAI. In reality, training data is just one variable, exponentials don't last forever, and your competitors will get better at capturing a bigger slice of training data.
a) indicative of problems that aren't already out there in the wild? (no) b) are the responses I'm getting so good and novel that the model can improve itself? (no)
It's the garbage in garbage out idea, just scaled up. If the model gave a bad answer, and I didn't catch it, and you now train on that I/O pair (my perhaps crappy prompt, the bad output), then you're not going to improve anything.
It’ll certainly take years but I would not bet against China’s ability to manufacture something.
Is lack of inference chips due to the trading blocks by trump administration? What if Trump agrees to sell chips to china, would they collapse then? That's not a very strong position to be at
IMHO, this has the impact of softening the impact of data centers sitting unused in the long term if they can still serve open weight models, even if Anthropic or OAI have to scale down their expansion rate to pay the bills.
Regardless, reality has to give at some point; these valuations don't make any sense. We've been valuing GenAI as disruptive work, when in reality they're much closer to cloud providers with a beefy, one-pony-trick R&D department.
so, you know, they're as vulnerable as utilities at this point, if only there were people who gave a shit more about society than greed.
When Xi Jinping did the announcement of their open weights push, they might as well cancelled their IPOs....
I close-out all my positions by end-of-trading everyday… so when the day came when there was a very clear and very scary indicator during early trading hours, quickly followed by SpaceX’s catastrophic fall right after opening bell, that was the end of my involvement….
And I fully expect oAI and anthro to be the same way. They’re being propped up with private loans, subsidies, and other tricky bookkeeping techniques. You would think their CEOs would pivot away from their current public personas. Ironically, they are like a poor man’s Elon Musk… and that doesn’t bode well for their companies
Second, humongous models are impractical even for them to deploy widely. They’re best used as teachers for smaller, more efficient models that can crank out the volume they need to sell.
Finally, there is a data wall. Sure, they can keep scaling RL on math problems and code. But with everything else, where will the supervision come from when they need several orders of magnitude more?
That's assuming the infrastructure needed to develop models stays available financially and supply wise. A lot of the services used to train and develop models are supplied and funded by people who are looking for multiple returns of investment. If/when OpenAI and Anthropic valuations fall and they inevitably get acquired, will Meta/Alphabet/Microsoft still want to spend lots of money for unclear returns in the short-term? Nvidia and co are on a one way train service to hype town. I don't think they will be happy to get on a coach to hype town Temu version. The shareholders likely won't.
Also, the backlash against LLMs is growing rapidly. AI content, data centres, etc is quickly gaining negative connotations outside of visual and music artists circles. While existing models are going nowhere, developing more advanced models is very quickly getting unpopular. LLMs Data centres increasing people's bills, Anthropic destroying old books, chat bots giving unethical advice to vulnerable people, etc. It won't be long before LLM infrastructure becoming an electoral issue.
Will a small research oriented community be big enough justify maintaining the apparatus needed to produce infra tech at a profitable level post OpenAI?
Also, take in consideration that the AI trade infected a lot of other trade in the economy, if you decide at some point to move your money to a place that is safe in case of a downturn be sure to carefully evaluate that’s actually the case
Compare and contrast how the dot-com bust did _not_ lead to global financial crises. Nor did Black Monday, nor the recent string of bank failures in the US.
('Manufactured' above means that central banks are responsible. I make no judgement on intent here. Around 2008 it was incompetence by the Fed and ECB as far as I can tell. The Fed started paying interest on excess reserves and the ECB even increased rates. Twice. Amongst quite a few other missteps.)
It is said that it comes with all hardware and software required to run inference or training with an open weights LLM.
The existence of this product, which competes with cloud-based offerings like those of OpenAI and Anthropic, is presumably the reason why the Palantir CEO criticized very harshly some time ago the business model of OpenAI/Anthropic.
While I doubt that the ethics of Palantir is any better than of OpenAI/Anthropic, in this particular case I have to agree with Alex Karp about "Sovereign AI", i.e. that only losers will make their business completely dependent on an external entity like OpenAI or Anthropic, who are certainly not trustworthy.
It is just a dedicated computer system, which should be managed by its owner, like any other on-prem servers.
I doubt that it has a good price/performance ratio, but it is a solution for those who feel that they do not want to search, buy, assemble, install and configure every HW/SW component.
I'm under no NDA, if you actually want to know what's up.
For a lot of people (and orgs I'd guess) who just go and buy ≈$20 per month plans (or more for teams), they might not even need a fraction of that cost or capability. A lot of them don't even need it for coding or graphics. Even the API access based pricing aren't great from these frontier US AI houses. The distribution of "LLM being" offered will also give rise to many open-router like offering but at the end point level - direct interfaces to the customers. Pick your vendor sort.
AI shouldn't become another "search means Google".
We’ve a hybrid shop, including hosting our own ML infra, and we save a ton from cloud spend with local ML. Easily one million USD over past three years. But it’s not “free”, you are shifting a lot of labor into your plate.
All boils down to short-term/long-term thinking.
For our own model training we needed to do some large scale translation tasks of a large dataset (1M or so documents, 10 or so target languages), running full-size NLLB on-prem saved us an absurd amount of money vs Google Translate API.
(For reference doing 1M target docs into a single language in Google Translate API is roughly $120k list price. You can run full size NLLB on an 48GB NVIDIA A600 and the major difference for us was speed, but for this task time to completion wasn’t an issue.)
Disagree there but I think this is an interesting idea. We would need to find some more cost-efficient hardware to run it on than Nvidia GPUs.
Trump keeps calling his enemies “communists”… then turns around and ‘seizes the means of production’ himself.
I wish they had tried to IPO because then we’d see the judgement of the market on this. But that’s why they didn’t this year. How long can they keep up the charade that their models are uniquely valuable and on the path to AGI?
What's the collusion?
It's what enron was doing; it's what most of crypto's offshoots were doing.
Sure you can blame the marks of the grift and say "well the public should know they're faking all this cash flow expectation".
It seems like you're either driving the grift economy or part of the collusion.
It's similar to how a cult operates, so I'll be frank: your skepticism seems biased.
Enron hid billions of dollars in debt and fake profits.
Is this what you think is happening here?
Bold claim!
All investors.
There’s an assumption that you can spin up the infra and acquire customers within that margin
It's been a few years. Has anyone done this successfully yet?
Which models are most popular in Europe?
Only Nvidia and approved friends can at the moment. Nvidia can even backstop your loan required.
Market is irrational.
- military applications - financial applications - medical - applied science
In all those cases it is achievable for those who have needed training data, and Chinese are not going to get them easily. US AI Labs are showing: give us the data, we will do wonders, promising "singularity"-level future achievements.
Provoking war, this is how the empire "defends" itself, usually.
I just hope that this time it will get stuck in your throat.
> How are you all toying with running this kind of thing in a mega quantized way locally?
Sure, let me answer that in excessive detail. I briefly tried running the UD IQ3_S quant of GLM-5.2, which is 288 GiB of weights (301 GB). Setup was: llama.cpp, 1x NVMe SSD (Evo 980), 64 GiB DDR5-5200, i9-13900HX, and 1x RTX Pro 6000. Token generation around 0.7 t/s. Not remotely usable interactively, but something I could plausibly push a codebase into and come back to a review in a couple of days.
There's potential for that hardware to go much faster, but current local inference backends make poor use of the memory hierarchy. Ideally I would have: always-active weights, KV and hot expert cache in VRAM; warm expert victim cache in host RAM; and disk as a last resort. Instead it's 1/3rd of the layers fully pinned in VRAM (all experts), and 2/3rds running wholly on the CPU with mmap()'d weights. The CPU cores spend most of their time sleeping on disk fills.
llama.cpp has backed itself into a bit of a corner architecturally by trying to support all models on all possible backends. If you look into how their "MoE offload" feature works (not viable for me because it requires enough host RAM to permanently pin the weights) you very quickly realise it's "oops, all bubbles!" due to the static compute graph splits. There are more focused frameworks like DS4 [1] and Colibri [2] which have better support for streaming weights from disk, and support GLM-5.2.
Obviously I wouldn't recommend my setup for huge models like GLM-5.2. Supposedly it can just about be squeezed into 3x GB10, or run comfortably on 4x GB10 (tensor-parallel) for multi-user serving. I'm not sure whether that qualifies as local, but it's at least not a rack.
Not sure about Sol as I haven't used it, but, at least for security work -- does it matter? It's not like you will be allowed to use Fable (or access Mythos) for anything cybersecurity-related unless your name is "Dario Amodei" or you are one of his rich friends. So regardless of how good Fable/Mythos is here it's a completely moot point for normal people, because they can't use it for that anyway.
Imagine asking for permission to use your hammer
However, even being in the cybersecurity programme, Fable refuses to answer prompts that it determines could be even tangentially related to cybersecurity. In fact, for a while, I was unable to use Fable with any prompt, as it recalled from memory that I was a cybersecurity professional, which triggered the refusal even for simple prompts like asking for a chili recipe.
No one gets to use Fable for Cybersecurity work, and Mythos is not available under CVP. Only for select few customers, and there isn't an application form?
I mean what honestly are you thinking Anthropic can do to give you better cyber tools? Their frontier model was literally nuked by the feds for a month for doing it.
Fable is their version with guardrails on everything except "Make me a pelican svg" or "create a to-do" app, that is the version that the government banned
Only a few corporations have Mythos because the US government is whitelisting them one at a time. Anthropic releasing Mythos to the public was never on the table, they would have been shut down in milliseconds by the feds if they tried.
Then the government believed Amodei's bullshit and this is a result of that, this was all self-inflicted.
No, Anthropic did not mind-game the US government into being worried about cybersecurity. The NSA has been paranoid about cyber controls for longer than you've been alive. If Anthropic had come out of the gate saying "no don't worry man, our model is TOTALLY COOL", while simultaneously attacking HAWK and finding core Linux vulnerabilities, I assure you the US government would have caught up about ten minutes later and we'd be in exactly the same spot minus your ability to tell Anthropic they were wearing the wrong dress and asking for it.
Now that Chinese open weight models have similar capabilities, and their guardrails can also just be removed, it doesn't look like anyone has "hacked" into everything because of the scary dangerous models like Anthropic were making it out to be.
The majority of high severity vulnerabilities are not the kind of thing you need a PhD in Comp Sci to comprehend, they are mostly about finding a way to get a system to end up in a state different than was anticipated when entering a particular code path.
Exhaustively looking at code and identifying ways to do this is something LLMs are quite good at. They don’t get tired, and you can run them non-stop.
They're also (generally) quite good at reading the literal meaning of the code, whereas humans often see the intended meaning first, and can be biased.
If you had a tireless junior engineer who was given the job of “make this application get into a state it’s not supposed to be in”, you’d probably get similar results.
What Mythos is quite good at is both the first bit and coming up with ways it could chain that together with other bits of unexpected state to create something that forms a meaningful vulnerability rather than a dead end.
Look at the recent HuggingFace hack. One vulnerability was template injection, another — remote code execution. Combine them and you pwned the remote server.
People working under Project Glasswing reported that Mythos at one point chained 20 vulnerabilities to produce working exploit. Humans don’t usually do that.
They put an enormous amount of compute into bug hunting, and they found some bugs. Fair enough. For me that begs the question: what if they had spent the same compute on generating more tokens with a less-capable model? What if they had spent it on traditional fuzzing?
In fact I think the opposite is true. The Zcash bug was found with opus 4.6 or something like that. Many worse models currently in the wild might be very capable but not yet industrialized for bug finding.
Another example from today. Cryptography system that’s been around for decades: https://eprint.iacr.org/2026/1630
It’s going to be a bumpy few months
Okay, here's a challenge: I assume you're not a rich and powerful entity, so try to gain access to Mythos. I'll wait.
> I mean what honestly are you thinking Anthropic can do to give you better cyber tools? Their frontier model was literally nuked by the feds for a month for doing it.
Well, first I'd suggest they stop with the constant fear mongering.
Here's my prediction for what will happen: the Chinese models will catch up to Fable/Mythos. They will be fully unrestricted and everyone will have access. The world will not end. Good guys will use them to harden their systems, in equilibrium to what bad guys have access to, so effectively status quo will not change.
Of course, Anthropic is after regulator capture, so this all likely worked out exactly as planned.
The causality chain here was not "US government says its dangerous -> Anthropic can't release it", it was "Anthropic is fear mongering -> US government listens to their fear mongering".
for some reason I couldn't find any way to download it from that website.
Agreed.
This release is the first time I'm able to employ a GLM model to write a substantive plan for a complex Clojure PR [1] with both Opus 5 and GPT-5.x playing supporting / reviewer roles.
Initial results are __very__ encouraging. GLM 5.3 -
- follows directions,
- digs into detail, and
- correlates well.
Still not confident about entrusting GLM with implementation - but IMHO, western labs are entirely cooked.
[1] 2K LoC PR in a 55K LoC Clojure + Clojurescript repo
Isn't post-training turning out to be the most important part?
The Gemini 3.7 Flash model released yesterday, and all the 3.x Flash models, are still based on the Gemini 3 pre-training run from January 2025 !!
What's crazy is that this is a relatively small model - approx. 750B total, 40B active params, while Sol and Fable are one or two tiers above that (Kimi 3 and Qwen 3.8 also ~3T params).
4x DGX sparks should let you run this at 4 bit at least and there are some folks who ran GLM 5.2 on this configuration in r/LocalLlama
I only have one and am wondering what the benefits are of getting another. I feel I will be disappointed…
For something like GLM, it's larger, has a larger number of active experts, and doesn't support tensor parallel. This means performance doesn't really scale with more Sparks. You can layer split, but then you are still seeing each layer in series and so if anything performance gets slightly worse. I would not expect more than 10-20 TPS on GLM with 2-4 Sparks.
At this point, Anthropic only needs to release models to the public when the competition forces them to.
OpenAI also has a better model (Astra) that they haven't released yet.
They can't release it - it's contaminated, and they will have to go back to a much earlier version. At least I hope they are doing that!
So no, they probably don't have a better model.
The question is whether this steals enough marketshare from frontier providers that they don’t have the capital to train the next model iteration. The open models are going to push down the unit price of an intelligence-token, but there will still be a market for a smarter bot. And as intelligence gets cheaper, the demand for it will rise (see Hank Green’s Jevons Paradox video). Not to mention there’s all kinds of other directions to go at the frontier (world models, robotics, video gen, etc).
Another thing, and this is pure speculation, but if the Chinese model providers already discovered the decrypting COT trick and leveraged it to do RL training, and assuming frontiers plug that hole, then maybe future distillation will be harder.
It’s whether you absolutely need the latest capabilities (at the cost of very high prices, sending your data to them, and being totally at the whim of 2 companies, that can shut you off anytime for any reason).
With how good LLMs are already, there’s tons of tasks where not being at the absolute bleeding edge doesn’t matter, especially when you add cost/freedom/supply chain risk/not leaking your data.
Even more - there’s increasing number of companies that give you ability to post train open weight model yourself, for your own use case. Given how many of the gains today are from post training, if you post train it for your specific use case, you’re very likely get model that you own, that works for you as good as frontier, at the fraction of the cost.
That’s not something for an average Joe to do, but for any bigger business with big spent it’s only natural thing to look into. Just one example - cursor composer - that’s fine tuned kimi.
It’s not whether frontier labs will stop releasing models. It’s whether they can generate enough profit out of them. 2 years ago (even 1) they basically had monopoly and combined with demand explosion as capabilities exploded - valuations grew to insane levels. But math now looks different - they no longer have monopoly.
Assuming the government allows them to lol
I rather pay a few bucks more and not have to deal with that nonsense
in some cases (mainly reverse engineering) I have observed GLM 5.2 jailbreaking itself with no effort on my part, the thinking trace revealed that it did some mental gymnastics to pretend it was a crackme or capture the flag competition.
Even if there was a small/medium gap, the fact that this is a free model beats both of the above on pure economics.
So exactly the same as Opus 5 and GPT 5.6 Sol. It's all "post-training magic".