It's a race to the bottom on pricing on the provider/infra side. It seems very unlikely that any single LLM provider will achieve a sustained and durable advantage enough to achieve large margins on their product.
Consumers can swap between providers with relative ease, and there is very little stickiness to these LLM APIs, since the interfaces are general and operate on natural language. Versus something like building out a Salesforce integration and then trying to update that to a competitor. Or migrating from Mongo to DynamoDB.
Building the LLMs is where the cool tech lives, but surprised so many are seeing that as a compelling investment opportunity.
It's a race to the bottom on pricing on the provider/infra side. It seems very unlikely that any single LLM provider will achieve a sustained and durable advantage enough to achieve large margins on their product.
Consumers can swap between providers with relative ease, and there is very little stickiness to these LLM APIs, since the interfaces are general and operate on natural language. Versus something like building out a Salesforce integration and then trying to update that to a competitor. Or migrating from Mongo to DynamoDB.
Building the LLMs is where the cool tech lives, but surprised so many are seeing that as a compelling investment opportunity.
But, let's see!