We're hitting a limit, that's what's happening.

I believe the development of new models has been like an s-curve: There were enormous incremental improvements earlier on, but now we're reaching the right-hand side of the s-curve and all the new models are clustering together.

Even the lighter and smaller and cheaper models going to end up near that limit, and that will likely evaporate the perceived economic value of both OpenAI and Anthropic unless they manage to lock it in/offset it with platform effects and branding (they might well be able to do that).

My impression is that we might well be able to move past that limit, but we would need another radical invention like the transformer architecture that the whole current generation of models is built on.