Imagine a new pharmaceutical that was found by a researcher. (…)
Now with AI the thought process is similar. (…)
The two are nothing alike. The pharmaceutical has a pre-determined market, and a known effect. A researcher who finds a treatment for Somethingitis will know in advance that people with the disease will want it. They will want it because the medication has a proven effect. Nobody has to hand out the cure under cost to get people enthusiastic about it (In fact, without proper controls, the exact opposite happens. See the USA)
LLMs are pretty much the opposite. They’re a solution looking for a use, and are only very marginally successful in that. Nobody can say “this product will cause that effect”, pretty much by definition.
That’s why they’re giving their product away, and massive subsidizing the use of it. If they stopped, nobody would use it. And every month, the models get more and more expensive even as the scale increases. Actual results are few and far between, except for very niche applications which won’t recover the costs before the next millennium.
The best comparison I’ve seen is someone selling stale bread covered in gold leaf for ten bucks. Is there a market for it? Sure, decorative bread is on display with many bakers, and I’m sure you could sell some of it for croutons and such. But nobody is buying stale bread en masse. But if you sell stale bread for 5 cents, you bet your ass people will buy it. It might not be great, but come on, for 5 cents I’m willing to eat a lot of toast.
I agree with you and that is basically what I tried to say. I just used the pharmaceutical to explain the concept of investment, expectation, profit. I think both are in fact not the same, while investors think they are.
The two are nothing alike. The pharmaceutical has a pre-determined market, and a known effect. A researcher who finds a treatment for Somethingitis will know in advance that people with the disease will want it. They will want it because the medication has a proven effect. Nobody has to hand out the cure under cost to get people enthusiastic about it (In fact, without proper controls, the exact opposite happens. See the USA)
LLMs are pretty much the opposite. They’re a solution looking for a use, and are only very marginally successful in that. Nobody can say “this product will cause that effect”, pretty much by definition.
That’s why they’re giving their product away, and massive subsidizing the use of it. If they stopped, nobody would use it. And every month, the models get more and more expensive even as the scale increases. Actual results are few and far between, except for very niche applications which won’t recover the costs before the next millennium.
The best comparison I’ve seen is someone selling stale bread covered in gold leaf for ten bucks. Is there a market for it? Sure, decorative bread is on display with many bakers, and I’m sure you could sell some of it for croutons and such. But nobody is buying stale bread en masse. But if you sell stale bread for 5 cents, you bet your ass people will buy it. It might not be great, but come on, for 5 cents I’m willing to eat a lot of toast.
I agree with you and that is basically what I tried to say. I just used the pharmaceutical to explain the concept of investment, expectation, profit. I think both are in fact not the same, while investors think they are.