Cloud compute has managed to have pretty good margins. That seems like a really similar business model to what Anthropic is doing - inferene+value-adds as-a-service. Why wouldn't they also be able to get cloud level margins or a bit higher?

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WarmWash 4 hours ago | parent | next [-]

Lots of people seem to have pretty short memories (or are too young to have seen it), but the flight from "local service" to "cloud service" was intense.

Companies don't mind paying extra to have a another company that does nothing but said thing do said thing for them. It even actually often ends up being cheaper/more profitable.

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jkubicek 4 hours ago | parent | prev [-]

I don't think AI will be able to sustain cloud compute-size margins. Inference is a commodity and value-adds can't be sold for anything. Why pay for an advanced harness when you can just ask the model to build one for you?

	▲	forshaper 4 hours ago \| parent [-]
		Observing SaaS vs using an open source stack in the beforetimes, the answer might be some combination of, "So I never have to think about it, and if anything goes wrong, no one can blame us because we went with the biggest & most trusted provider."