> Nobody can figure out how to SELL it. Because few people are buying it.

Just picking one company who basically just does AI, OpenAI. They reported it has 20 million PAID subscribers to ChatGPT. With revenue projected above $12b dollars (https://www.theverge.com/openai/640894/chatgpt-has-hit-20-mi...).

I think what you meant to say is that costs are high so they can't generate large profits. but saying that they can't figure out how to sell it seems absurd. Is it Netflix level of subscribers, no. But there can't be more than a couple of hundred products that have that type of subscription reach.

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strange_quark 11 hours ago | parent [-]

Ok but isn’t 20 million subscribers out of what, 800 million or 1 billion monthly users or whatever they’re claiming, an absolutely abysmal conversion rate? Especially given that the industry and media have been proclaiming this as somewhere between the internet and the industrial revolution in terms of impact and advancement? Why can they not get more than 3% of users to convert to paying subscribers for such a supposedly world changing technology, even with a massive subsidy?

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kenjackson 11 hours ago | parent | next [-]

As another commenter notes, because you get access to a lot of functionality for free. And other providers are also providing free alternatives. The ratio for their free/paid tier is about the same as YouTube's. And like YouTube, it's not that YouTube isn't providing great value, but rather that most people get what they need out of the free tier.

The better question is what if all LLM services stopped providing for free at all -- how many paid users would there then be?

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tjwebbnorfolk 7 hours ago | parent | prev | next [-]

You could say the same of Dropbox. Or Gmail.

	▲	const_cast 5 hours ago \| parent \| next [-]
		A service like Gmail or Dropbox with low storage is close to free to operate. Same thing with iCloud - 50 gigs a month is what, 1 dollar? How is that possible? Because 50 gigs is next to nothing, and you only need a rinky dink amount of compute to write files. YouTube, on the other hand, is actually pretty expensive to operate. Takes a lot of storage to store videos, never mind handling uploads. But then streaming video? Man, the amount of bandwidth required for that makes file syncing look like nothing. I mean, how often does a single customer watch a YouTube video? And then, how often do people download files from Dropbox? It's orders of magnitude in difference. But LLMs outshine both. They require stupid amounts of compute to run.
	▲	bucklybuck 7 hours ago \| parent \| prev [-]
		True, although I don't think Dropbox or Gmail's operating costs to support those free users are anywhere near those of OpenAI.

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oarsinsync 11 hours ago | parent | prev [-]

Because they give too much of it away for free? Most casual use fits into the very generous free tier.

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strange_quark 11 hours ago | parent [-]

Ok so the argument is that all the model builders either suck at business or they are purposefully choosing to lose billions of dollars?

	▲	alonsonic 10 hours ago \| parent [-]
		They are purposely losing billions, this is a growth phase where all of the big AI companies are racing to grow their userbase, later down the line they will monetize that captured userbase. This is very similar to Uber which lost money for 14 years before becoming profitable, but with significantly more upside. Investors see the growth, user stickiness and potential for the tech; and are throwing money to burn to be part of the winning team, which will turn on the money switch on that userbase down the line. The biggest companies and investors in the planet aren't all bad at business.