> it's the fact that they have to train the next iteration right away due to competition

That it would be profitable if only there were no competition is not a really strong starting point for an IPO, though, is it?

(It is, however, the winner-takes-all world view Anthropic still seems to operate with)

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vidarh an hour ago | parent [-]

Their competition has the same problem. They're engaged in a giant game of chicken (or giant game of "who runs out of ability to raise more cheap capital first") with respect to overspending on training relative to inference revenue.

So, yes, it's high risk - you're basically betting on who will be in the strongest position when one or more of the competitors are forced to slow spending and the rest are able to ease off on theirs as well as a consequence.

If you think either that Anthropic is in a strong enough position to come out on top or that we'll end up with a detente like with the big cloud providers where they big providers feel they have a strong enough position to beat off upstarts and collectively basically stop competing other than on the margins because they all know they'll earn more by protecting their margins than by internal competition, then the IPO might be worth putting money on.

I think the latter scenario is slightly lower risk, but still risky given how small the moat appears to be vs. the Chinese labs (I say this as I just had Kimi re-design a website in 10 minutes by just giving it the URL to the current one and tell it to replicate everything; they might not be as smart as the frontier models yet, but they're capable enough that they're taking over an increasing proportion of my token budget)

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dofm an hour ago | parent [-]

> Their competition has the same problem. They're engaged in a giant game of chicken (or giant game of "who runs out of ability to raise more cheap capital first") with respect to overspending on training relative to inference revenue.

It's a sort of weird chicken game in that there's a meta-chicken game going on too — they are both, sort of separately, betting that the outcome of their chicken game will be too devastating for the US economy for it to be allowed to happen.

(I say "sort of separately". But the one guy used to work for the other guy. You know how people who split up from partners spend the next few years trying to shake their ex-partner's framing of the world? They know each other's thinking; they are aligned where this meta-chicken game is concerned)

	▲	vidarh an hour ago \| parent [-]
		They don't need it to actually be devastating. They just need sufficient fear of it. Especially if it is finely calibrated enough that they get to continue at a slower pace, but end up with enough expensive red tape to slow down upstart competition more because of high compliance costs. If they can't beat OpenAI etc., the second best is to near-freeze market shares in place at a lower rate of investment - hence my comparison to cloud providers where none of the big providers makes too large reductions in prices etc. because they all know they'll all lose on a price war.