• kunaltyagi@programming.dev
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    4 days ago

    People familiar with inference costs think that the API prices are either already profitable enough. The major cost sinks are the subsidized subscriptions and RnD costs.

    The subsidized subscriptions are similar to how Uber burned cash and jacked up prices after killing competition. The RnD costs remain difficult to offset unless these companies have sufficient scale

    • NotMyOldRedditName@lemmy.world
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      3 days ago

      The RnD costs remain difficult to offset unless these companies have sufficient scale

      Ya thats going to be deciding factor. Can you get enough users to offset it and stay alive before you run out of cash. If you slow down, and your competitors still have enough cash they’ll make a better product and you’ll start losing users.