Commoditization means there's price competition. From a consumer perspective, that's good. You want it to be a low-margin, high volume, competitive business.

Although from a business perspective, it can end up being ruinous competition like solar panels or airlines. A stable equilibrium with prices neither too low or too high isn't guaranteed; it depends on market structure.

It's anyone's guess whether this reaches an equilibrium or not, but I still expect that there will be companies like OpenRouter and Fireworks that offer inference at reasonable prices.

>Commoditization means there's price competition. From a consumer perspective, that's good. You want it to be a low-margin, high volume, competitive business.

You and I may want it to be a low-margin, high-volume business. But the valuations of OpenAI, Anthropic, and much of the rest of the AI industry are not based on that assumption. They are based on the assumption that there will be a couple of winners, like in the smartphone wars, and that those winners will be able to maintain good margins.