So where are these training costs getting paid from?

In a way in US it is - _IF_ ppl were rational economic agents and free market allocation worked student loans should reflect on the wages too.

the saying "comparing x and y" implies that you compare something that one of them can't compete ; if people praise the softness of the skin first and foremost, comparing apples and potatoes won't lead interesting results

OpenAI and Anthropic aren't charities, so whatever cost they inccur for training will be passed down to the companies using the models

You should, but with two important caveats. First, you don't know what their amortization schedule is like so you don't know what the impact on the pricing will be (are they going to pass the cost on over 5 years or over 20 years?), and second they may go bust before paying the cost down so they may not get a chance to pass it all on. If someone buys the company then they'll get a discount on the value, which means the training costs are just eaten by the investors.

Well … one was a non profit and I still can’t figure out how it kept the donations the tax benefits and because a trillion for profit company

The problem is how it's framed:

Anthropic spends [...] about $2m of compute per employee per year against a likely all-in comp of $500k+.

The rest of the software market trails. The top 1% of companies spend $89k per engineer per year on AI

This framing makes no sense. The reason Anthropic spends so much on compute per employee is that they are building models. Anthropic employees aren't opening Claude Code and spending $2m in inference every year, so comparing it to other software companies, where AI expense is mostly inference, is completely incoherent.

Yes, the cost has to be passed down eventually, but it's not passed down to one company; it's passed down to all of Anthropic's customers, so the actual share of that money will be distributed among Anthropic's clients.

Look, I 100% agree with the idea that OpenAI and Anthropic are both unsustainable companies that have dug themselves so far into a debt hole that, most likely, the only way they'll be rescued is with government intervention, but this is still a terrible article.

> whatever cost they inccur for training will be passed down to the companies using the models

Assuming their investors win the bet they placed on them. Which isn't given.

Why can't we pass on the costs of OpenAI and Anthropic's training back to OpenAI and Anthropic?

Bandwidth isn't free, and all my life I've been told that piracy is theft.

I came to appreciate typos, slightly ungrammatical sentences, and creative plays on common phrases. They are completely absent in LLM output without a specialized prompt (and they seem to struggle to make believable language mistakes even when prompted), so they can serve as a signal when judging whether the text I'm reading was written by a human.

As an aside, I observed my stance on proper English use changing in real time over the past 2-3 years. I used to be proud of writing clinically correct prose, and found mistakes in grammar and vocabulary grating. Now, I kind of welcome them and have stopped caring at all about committing such language crimes. I used to cringe when someone didn't capitalize the first words in their sentences - not anymore. I think we're years away from LLMs convincingly faking human-like mistakes (since all the work currently goes into avoiding them), so it's going to remain a useful signal for a while.

Maybe an ESL thing? "Potatoes" are literally called "earth apples" in some languages (e.g. pommes de terre in French; Erdäpfel in some German dialects.)

I read it as trying to indicate that it's even more different than apples and oranges.

Not sure it succeeds in that, but I think that's the intent.

Grape and aspergus, we all get it

AI training uses wildly more compute than most companies, who are generally building domain specific CRUD apps.

Compare AI costs per-engineer-salary-dollar, because more expensive engineers probably need more expensive AI.

If you’re going to include AI training in costs, you should include education as part of the costs of an engineer …