I guess this is the end of OpenAI? No more dreaming of Universal Basic Compute for AI, Multi Trillion for Fabs and Semi?
This is just like everything in China. They will find ways to drive down cost to below anyone previously imagined, subsidised or not. And even just competing among themselves with DeepSeek vs ERNIE and Open sourcing them meant there is very little to no space for most.
Both DRAM and NAND industry for Samsung / Micron may soon be gone, I thought this was going to happen sooner but it seems finally happening. GPU and CPU Designs are already in the pipelines with RISC-V, IMG and ARM-China. OLED is catching up, LCD is already taken over. Batteries we know. The only thing left is foundries.
Huawei may release its own Open Source PC OS soon. We are slowly but surely witnessing the collapse of Western Tech scene.
> We are slowly but surely witnessing the collapse of Western Tech scene
Generally, I’ve found that almost no founders or friends I speak with have any vision for the future anymore. They care only about making money and do not care how. It’s a spectacular collapse of vision and purpose—these people have always existed but it feels incredibly pervasive now.
With that, I realize your comment is much broader than AI so below is too domain specific but…
VC has been investing in AI as-if it were a winner takes all market, but it has been obvious that isn’t the case.
Not only that, but the massive amount of cash thrown to anyone with even marginal credentials has undermined the constraints that often lead to innovation.
There is 0 reason that Safe Superintelligence should be raising for the second time at a 30 B valuation with no product.
> VC has been investing in AI as-if it were a winner takes all market, but it has been obvious that isn’t the case.
I really don't see how this was supposed to go, and I've never heard an explanation.
I don't see any kind of coherent vision from any of these types.
Most normal folks (i.e not SV/HN types that seem to desire to replace their marketable programming skills with LLM output) really don't "want" LLMs in any real sense.
Sure, people use them like a search engine, kids cheat on homework with them etc, but there's not this overwhelming universal desire for them like there was for, say iPhones.
I never once have heard any sort of proposed roadmap for how LLMs were supposed to work as a product.
They were just going to get, uh "really good" and take everyone's office job or something?*
Normal F500 organizations that are obviously a target for LLM use (via hyperscaler sales) are still yet to see a clear path to "revolutionizing" their workforce or whatever via LLMs-it's just not there. Costs are too high, there's no obvious use case, "hallucinations" are a real impediment etc.
I'll add many of the public usecases for this (i.e those a hyperscaler would blog about as a sales promo) are seriously weak ("we reduced onboarding time by 20% with $MODEL")
I would really like to hear a proposal for how this is all supposed to come together. Does anyone have a concrete plan for the future for all this stuff?
*I'll note, this is NOT the way to sell a product to the masses, either.
Addendum: I'm not an "LLM hater" by any means. I pay for GH Copilot, and have been running local LLMs since it's been a thing (granted with limited hardware, and limited quality)--I intend to wait a bit and buy better hardware with one motivating factor being running local LLMs in a year or so when the open-source offerings stabilize"
You're looking for a proposal for how it's supposed to come together in the future, but VCs are living in the world where it already has come together. Normal F500 organizations have widely adopted LLMs, with OpenAI reporting that 92% of them are customers. (https://www.axios.com/2024/08/29/openai-chatgpt-200-million-...) Determining individual business usage is always a bit sketchy, but at least one survey run by a major staffing firm indicates that a majority of workers and almost all executives use generative AI for their jobs. (https://www.weforum.org/stories/2024/01/ai-training-workforc...)
I have changed from Copilot to Cline with Claude 3.7 and it is a total gamechanger. For some one like me being able to describe a multi file edit is really empowering. I hate that kind of busy work
This is one of the most finest and most accurate things that I have read in a long time.
This really could be a blog post which I encourage you to make! (I would prefer github pages but if you really want , I have a domain name on cloudflare and I am more than willing to host the static page of such blog on my own domain name for absolutely free (lets go , cloudflare!)
Its just facts. Pure facts.
""
Generally, I’ve found that almost no founders or friends I speak with have any vision for the future anymore. They care only about making money and do not care how. It’s a spectacular collapse of vision and purpose—these people have always existed but it feels incredibly pervasive now.
""
Why did I read it in a monotonous way as if a student from the future understands the current scenario.
I felt as if it was the same level of sadness in my heart as that when you listen to some video which has raining background and he reads the dark comedy (something like burialgoods oats shitposting but this time more serious and real!)
Currently saving this on wayback machine just for this comment. Internet needs to preserve this comment , no matter what.
There used to be significant alignment between engineers, founders and certain VCs: lots of excitement around building software that genuinely made things better/easier/cheaper. Each group naturally wanted a different thing out of this arrangement but each camp was on the same page.
Now I feel like everything is more top-down. The tech sector feels less like market capitalism and more like something being centrally planned: we all must chase trends that come from various industry thought-leaders. And it all must be done a very specific way (this in particular is why Chinese companies are likely going to disrupt the AI market: they’re free from this burden)
VCs are happy to throw money at something if they believe they can corner a market. It just doesn't have to do much with reality. Until of course, it becomes self fulfilling. But in this case it seems like it's not going to happen because nobody has a moat.
> I’ve found that almost no founders or friends I speak with have any vision for the future anymore.
I think in general there is a feeling that the time to get your bag is rapidly shrinking.
Once everything is built by these things there will be no reason to create anything as the platform owners (big tech) will be able to take everything for themselves and no longer have to share 70% with those pesky creators/small business/startups etc.
Founder risk has been nil for a long time either because they pay themselves six figures out the gate or because the job market has been hot enough that they can market utter failure to get another job.
There’s a lot of opportunity to make low cost software that out competes big tech just because it doesn’t demand 10000x returns on every if statement.
I’d encourage Europeans to start replacing American software vendors with small teams today. You won’t become the next American oligarch but you’ll be able to clean up millions from the incompetent Americans.
I think there's huge opportunity for software that replicates the 80% most used features from big tech companies/packages, but at half the price and a tiny fraction of the overall complexity. Think of Python Anywhere, offering a very simple Python-focused VPS/PaaS platform, but so so much easier to use than AWS.
It's similar to how China dominated manufacturing in prior decades.
They have massive amounts of low cost labor and, unfortunately, the US has pretty large walls up preventing mass in-migration of white collar workers.
H1B is capped and also more of a lottery than a points based system.
If the US allowed mass white collar immigration, wages would decline materially which would make our industries more competitive for the next generation of software.
Right now the system is geared around protectionism (intended or not) and wage inflation for US local workers.
The current market wages in software are far far above what a global equilibrium would be. Though myself and I'm sure most others here have benefited from it in the short term.
To be clear, established companies with an existing market are fine for now and can do well with high wages.
But the next generation of companies that are chasing smaller markets and margins, ones that require more elbow grease to out-compete are underserved.
e.g. the entire DeepSeek team was paid less than a few Meta engineers (with 7 figure comp each)
"The firm offers 14-month pay for various positions and the highest offer is for deep learning researchers for artificial general intelligence (AGI), with a monthly salary between 80,000 yuan ($10,983) and 110,000 yuan, which could mean an annual income of up to 1.54 million yuan, the report said."
> Huawei may release its own Open Source PC OS soon. We are slowly but surely witnessing the collapse of Western Tech scene.
The US has been so used to being number one that not being number one equates to “collapse”.
No the US Will NOT collapse. They just won’t be number one in economic/military/technological might. Similar to how many countries like the UK, Japan, and more have not existed as the number one economic super power.
It will be (arguably already is) societally rough though. The west has been riding the asian cheap labor for decades (and the cheap colonial labor before that). People are not gonna be happy falling down the "value chain".
Probably explains Trump's moves: Force out all the illegal immigrants doing low value work, kill off as much fluff in the government as you can to cut the debt load, those unemployed people are forced to fill in the low value labor. You've solved all the problems and everyone except the capital owners are worse off..but at least the capital owners live to see another day.
This is the old way of doing it, and probably the way the US is going to go with, at the detriment of its own population. - I would posit that since we are talking about digital goods, there is a better way:
Require open source / open weights of any company that used data to it doesn't own to train its models. If chinese companies do not comply, their copyright becomes void in the US, and these models are very easy to copy. Treat advances in architecture as a utility, and let the utilization of those architectures be the market for companies to compete in.
A copyright exemption would just put them at the level of deepseek officially, but they've been working around that anyway in practice. I'm not sure that change would make any difference.
When it comes to hardware who pioneered all those technologies? Definitely not China. They’ve stolen unimaginable amounts of IP and will continue to do so. But yes you’re right, they surprise everyone with how well they can scale the stolen innovation.
Possible, but if you look at the graduate students and lecturers behind many of these IPs you will find they are Chinese (or Russians or Iranians).
This is the paradox in those who are championing barring Chinese students from the US to prevent them from stealing IP, they don't see that at least 50% of this IP is generated by students from China, in a way they will be handing the CCP a gift by incentivising those students to remain in China.
>They’ve stolen unimaginable amounts of IP and will continue to do so.
All AI models are built on the back of massive amounts of "IP stealing". Either we consider IP to be valid and then all western companies in this space are just as bad, or we go with the direction the western companies are claiming and then China is not doing anything wrong.
These sour grapes comments are so goofy, and honestly a little racist. The millions of Chinese engineers working out in China are extremely talented, and to downplay their achievements like this and to chalk them all up as thieves is ridiculous. They have the skills, the man power, and the vision, and they’re eating the West’s lunch regardless of your feelings on how fair it is.
I don't think it's that, so much as the average western citizen isn't able to go and create a knock off of a new invention / product and have it sold without legal consequences. That has been available to many Chinese citizens though.
All developing markets "steal" until they've caught up with the competition. Just look at the US and how they "stole" innovations and tech from Europe.
“he brought British textile technology to the United States, modifying it for American use. He memorized the textile factory machinery designs as an apprentice to a pioneer in the British industry before migrating to the U.S. at the age of 21.”
in case of TSMC, having 80% most advance chip manufacturing concentrated in 1 small island for an entire world is clearly problematic (corona teach us a lot), no matter how you look at this
It is entirely irrelevant who pioneered the tech. This is why no one gives a crap about xerox anymore.
Dismissing Chinese tech is foolish. They are tech leaders in many areas and moving to new ones every day. Solar, Nuclear, Batteries, EVs, Drones, Robotics etc. They have no one to copy in those fields because they have left the rest of the world behind.
By the 1890s both the US and Germany had surpassed Britain when it came to industrial output, I don’t think it was any consolation for the Brits that they had invented it (almost) all.
I’m replying to myself to address multiple other replies.
First of all, it’s really sad to see people saying it doesn’t matter the journey of how one achieves success, and all that matters is your current state.
Brushing the CCPs countless acts of IP theft under the rug is like saying it doesn’t matter that the Trump family committed financial fraud for decades. All that matters is that they’ve managed to become billionaires today. Would the Trump family be anywhere near as wealthy if they hadn’t cheated for so long? Would China be much further behind than they are now if the CCP hadn’t stolen so much IP? I see multiple people here implying those questions are irrelevant, which I absolutely disagree with. Ignoring all that history is a huge injustice to everyone else who didn’t resort to that kind of behavior.
I also want to be clear I’m not trying to make some ridiculous claim that Chinese individuals have been working independently to hack and steal IP. It’s their government and that same government is to blame for the many people like me who really look down on them despite what they’ve ultimately been able to achieve. They undoubtedly have huge numbers of brilliant citizens. When I make comments about China’s shameful history of tech IP theft, I’m talking about their government.
Is it really theft when an American company sends over the CAD files to a Chinese manufacturer to make it for them?
I know there's some about of corporate espionage where trade secrets got exfilled, but what makes you so certain the majority of Chinese success is from stolen IP, as if electrical engineering grad students can't figure out how to make solar panels from first principals?
We are slowly but surely witnessing the collapse of Western Tech scene.
I think you're witnessing it rather getting back in touch with reality than collapsing. Multi-trillion out of jsx generator was too much from the beginning. You folks just don't know what to do with too much money you have.
> I think you're witnessing it rather getting back in touch with reality than collapsing.
You're witnessing the USA tech scene getting in back to reality. Software engineers in other western countries looked at the salaries the Tech scene was paying in the USA, and scratched their heads.
Its a collapse from fictional reality to real reality , but a collapse nonetheless.
Sometimes reality acts more weird than fiction itself. I have just now decided to call this "fictional reality"
Like yesterday when I realized that nuclear bombs weren't that far away from the creation of chemical resonance & they happened after world war I and I think , just really 5-6 years before nuclear bombs but still!
It actually gave me a lot of hope because I felt that a lot of people were focusing on AI , so I can use AI (sometimes , if I want) to focus on a passion project that I want , to maybe earn some money.
I have also thought of creating AI projects but that too for fun. I don't know two shits but I just want to know what the hype is about from a theoretical standpoint.
Correct answer, never think about the future in terms of linear extrapolations. It's a non-linear differential equation with lots of variables and expect complex feedback loops. Systems react to change.
When the cost of training a model goes down, it doesn't simply become cheaper to the end user. In addition to that, the provider will train even larger and more capable models.
> We are slowly but surely witnessing the collapse of Western Tech scene
Is economy a zero sum game now?
Isn't economic development supposed to be a good thing?
Can the West only exist in a world of poverty and underdevelopment?
With high degrees of automation that need not be the case. Consumer electronics is highly automated right now, where-as clothing production is currently not.
That doesn't make sense. Consumer goods have become cheaper and more accessible because the third world has become more productive and richer. If they become richer still it will be because they become more productive still, which will mean their exports will be more competitive (cheaper).
What user experience are you talking about? Chatbot? Or software in general? Cause Tiktok beats Facebook out of water. Chatbot for English communities sure, I also prefer Claude over Deepseek in terms of project support and UI. But this is because they are focusing on Chinese communities, Doubao has much better features that is used by Chinese. It's not really comparable even if all US chatbots were accessible in China. Once LLM tech slows, I am sure Chinese chatbots would beat the American ones in terms of user experience.
So far. China has been focused on becoming a world's factory for 30 years. They started moving up the food chain fairly recently.
Give it another generation and if China will not walk off the ledge with either government or societal issues (which, granted, is where they are slowly going IMO) they will own the UX and design as well. My 2c.
They’ve been moving up the food chain for 30 years. The only difference is recently that upward movement has begun to surpass the US.
Given that the US has been number one for a really long time now it doesn’t sit well with a lot of the patriotic identity people have about the US. People either can’t accept reality or the make up some excuse about unfair economic practices.
The last thing they want to admit is that China is more competent or more superior.
The moment I realized this was going to be the truth was when the Chinese government essentially purged a bunch of unicorn social media companies overnight, erasing billions of wealth on paper. It seemed like the motive was to value and encourage actual economic value over worshipping whatever makes the line go up. When I saw they had the guts and wisdom to do that I realized that they may have a better grasp on philosophy.
Previously I always thought democracy was a slow but eventually correct system of producing wisdom. And to a degree there’s been truth to this. However the missing ingredient has been what do we do with that success once we’ve had it.
The west would never have the guts to delete a billion dollar industry even if they realized it was a net negative. We simply don’t know how to guard against our passions, pleasures, and handle success in a responsible way. I think cccp has many flaws but taking bold action against this kind of problem isn’t one of them.
I do hope that I’m wrong about this though and that a democratic system can see its way out of a local maximum built upon an unsustainable way of doing things. I think the belief in the market as some kind of oracle that knows value and price is its language has a lot to do with this track we’re on.
I agree with your comments about the West. The fact that we continue to expand legal gambling is evidence enough that we don't care about the negative consequences of an industry.
But let's not pretend China is perfect. The purge had much more to do with a) eliminating a potential competing power to the CCCP, and b) Xi's boomer-era gut instinct that new media forms are bad.
Yeah, good points. Definitely not my intention to say China's perfect, and I'm probably reading too much into the wisdom of this vs. good ol' preservation of power.
>When I saw they had the guts and wisdom to do that I realized that they may have a better grasp on philosophy.
It's not a better grasp on philosophy. It's a logistical issue. A centralized government can wipe this out because control is centralized. In a democracy the control is spread out among people who understand, people who don't understand and among people who have business interest in said topic.
Think about it this way. The very people responsible for the unicorn social media companies in a democracy have a say in whether or not there own companies can be wiped out. If they're rich they can influence the game even more with advertising and propaganda. They influence the outcome and thus self interest actually pollutes the decision making process in a democracy.
It's not about guts. It's literally that in a democracy even the conflicting business interests can stop the right thing from happening because of they are self interested in the bad thing to happen. It is a logistical issue. When business interests influence government then government decisions favor business interests. It's that simple. And right now since businesses are more centralized and have more power then individuals then the government actually favors big corporations. That's the eventual outcome of most capitalist societies.
In a dictatorship, the dictator is usually well removed from such things and thus can make decisions very impartially and with no resistance. But like an evil dictator can do stuff like behead your entire family if you talk shit about him. Good sides and bad sides. The problem is you live in a democracy so everyone talks about how shitty the alternative is because of bias. The reality is democracy and dictatorship are simply two sides of a coin.
> They’ve been moving up the food chain for 30 years.
Organically, sure. If a company has an opportunity to build higher value components profitably it would likely take it. But that is slow.
What I mean is state pouring massive amounts of money, every year for many years, into as-is unprofitable areas to build not just the products but education, infrastructure and support needed for the local companies to become competitive.
WSJ had a good article in the last few days on China's containership building which AFACR said the government poured over 10 billion at the time to become the world's shipbuilder. This is the time of effort I am talking about and, as far as I know, it is fairly new.
$10B is a drop in the ocean. If all it took was a bit of money the US could have stayed ahead. For perspective, they’ve earmarked $800B for clean energy subsidies, that AI fund is $500B.
You can’t buy back entire supply chains and a workforce, it takes generations.
It was 10B 20 years ago when China was significantly poorer. And it is not just money. It is planning, oversight and various care and feeding activities (china-style, including executing officials for corruption) for almost 10 years before that part of the system became mature and economically self-supporting.
A lot of consumer tech with very competitive UX is coming out of China. They are also getting very strongly into e.g. web frontend tech. I see no reason why the west would have any special advantage in this.
They are ahead of Europe (at least in car UX) but quite behind of the US. This is the last stronghold that the US has but given the recent layoffs and transition toward "AI everything", I am not sure if the US tech industry will survive this too.
I would rate Europe over US by far for car UX. My north American vehicles universally have the worst interfaces. My European Cars typically the best and Japanese/others in between.
Thus demonstrating the point I was making with (and demonstrated by) the "attemped Chinese": machine translation isn't good enough yet. (This Chinese is from Google Translate).
Software is more trivial than hardware. That’s why you see bootcamps for software but not for hardware. China can easily eclipse the US on the software front. And they have.
Let's just hope they contribute back as much as the west has contributed to spreading knowledge and knowledge-tools to the world instead of just free-riding on it and then pretending it wasn't foundational. Linux, Wikipedia, RISC-V, ...
It's not just the Chinese who are lacking the acknowledgment of these contributions.
But it's something new by a very small company. They are trying to convince CCP and big players to embrace opening up. It looks good but it's a huge cultural shift for the Chinese politicians and tech giants. We'll see if it's more than a fad in a few years.
That is because they want to undercut the US and prevent them from making money. It remains to be seen if they'll be as benevolent in making tech open-source if they are the clear winners. Frankly, I don't see why they will.
I'm sorry but your comment comes off as racist. You've given no reason as to why they wouldn't do the same and your opinion seems entirely coming from assumption of ill-will. Why would you think the West have shared their knowledge while China won't? I suggest you reevaluate your biases.
FWIW I am not American or even from the west. At a nation-state level, the west (US) shared knowledge with the intention of offshoring production for cheaper goods, not out of the kindness of their hearts. They still protect key technologies like the jet engine and bleeding edge fab tech. It is the same when it comes to Chinese companies that are at the top of their game - DJI or Bambu labs don't open source their designs last I checked, and their track record when it comes to software is also not great. Simply put, companies only open source when it makes business sense.
I am simply assuming that China follows the same principle - try to wring maximum advantage out of their industrial might and commoditize their complement wherever possible. Because of China's unique single party system, their strategies are very top-down coming straight from the CCP in key areas like AI and robotics. It is not racism, simply realpolitik.
The CCP strictly controls knowledge and information access within China through rigorous censorship. It would be surprising if Chinese companies were allowed to just make their advancements open source without review, if those advancements would have a meaningful impact on the state of technology.
It is strange and inappropriate to call that observation racist.
I don't think it's intentional racism, but a lot of what many western folks think of China come from propaganda. China has visa-free policy for many countries now. Go check it out in person.
To be clear, believing propaganda generally is also not racist, unless that propaganda is specifically racist. And even if you believe censorship and authoritarian oversight of companies by the CCP is western propaganda, it is still not racist.
We can discuss the reasons why they might or might not open source things, or we can agree not to because someone might call us racist for discussing corporate and wcenomic motivations.
The West mostly has not shared their knowledge. Most software is not open source.
Chinese complete supply chain is ramping up. Previously they could achieve the Frontier but hampered by tools sanctions. Now Chinese indigenous tools are catching up.
Or (speaking as an American) we could just criminalize the use of Chinese LLMs.
/s ... but... maybe not?
Wherever you sit on the political spectrum the fact that this idea will almost certainly be seriously discussed in the coming months should be concerning to you.
They effectively are banned for a lot of the commercial world already. I cannot imagine most businesses American or European would be willing to use Chinese services.
Then you should bet on it if you are so confident.
Even if casual usage happens with employees which is questionable already, the real money would be from corporate adoption which is highly unlikely even from a European country, the risks are too high for data leaks.
China is building an entirely independent semi conductor supply chain and if they are not competitive now, they will be in the near future. US sanctions forced them into turbo charging their efforts.
I have two SO-DIMM sticks of a domestically produced Chinese brand named FASPEED, with chips bearing logos and markings that I don't recognize from anywhere else. These sticks' mfg. datestamp is "44-24" and from what I've learned they cost little in China but come with a salted price tag when sold through channels aimed at Western customers. I'm not sure if they come in fast-enough variants to compete, and not sure about the quality or longevity otherwise. FASPEED makes SSDs, too, but I have no data on those. I also have an M.2 SSD from another Chinese brand called XINCUU which I previously had never heard about. The label of that SSD is in parity with expectations of Chinese business morals - it claims to be PCIe NVMe with "1000 MB/s speed" but is in reality a SATA device, and it does not perform even close to the ~550 MB/s limit of SATA 3.0. Both of these run unusually warm for DDR4 memory and M.2 flash storage, leading me to believe they are wholly designed and produced in China.
That vast majority of conversations with AI is irrelevant to censorship. Well, I can only speak for myself, but surely you can see questions like "phone A vs phone B", and "how do I use feature X on product Y" or almost any programming question isn't concerned with censorship.
Is censorship a thing for models? Of course. Does it matter? Probably not, unless you either specifically have chats on those specific topics, or if you are trying to create a meme.
The concern of censorship is way overblown by some people. Most users only care about "does it work?", then some "is the answer correct?", and at the bottom is "is the answer censored, and according to what ideology?". Seriously, think about these models/products like a normal person.
But crucially not biased by RLHF being applied afterwards to stop the models from making basic biological observations, telling jokes about left wing politics, or saying anything nonnegative about European historical impact on the world, and so on.
There isn’t a “disturbing level of censorship” in either OpenAI or Anthropic. This false equivalency is a propaganda claim. DeepSeek has obvious extreme censorship aligned to the CCP agenda and it is well documented. There’s nothing like it in American or European AI. I’m sure the AI from Baidu or Bytedance or whoever will show something similar.
Based on what Altman says and leaked reports, OpenAI is actually losing money on every new user. Unlike traditional software, maintaining a SOTA AI service doesn't scale. The conundrum he faces is he can either quantize models and slash R&D to try to turn a profit now but lose the SOTA race, or keep pumping money and hope the rest bleed out. He's opted for the second, having raised 10B in 2023, 6.6B in 2024 and reports of another raise in 2025. He's probably trying desperately for the middle ground where an explosion of high price subscriptions replacing workers massively boost his revenue. So he's also reportedly projecting revenue 4x to 13B this year.
I wouldn't necessarily think so. There's still enormous room for quantization and hardware optimization, which China has proven to be world class at. And a lot of spend is really on R&D. For the same reason I believe if OpenAI waned to they could break even in a year
This is just like everything in China. They will find ways to drive down cost to below anyone previously imagined, subsidised or not. And even just competing among themselves with DeepSeek vs ERNIE and Open sourcing them meant there is very little to no space for most.
Both DRAM and NAND industry for Samsung / Micron may soon be gone, I thought this was going to happen sooner but it seems finally happening. GPU and CPU Designs are already in the pipelines with RISC-V, IMG and ARM-China. OLED is catching up, LCD is already taken over. Batteries we know. The only thing left is foundries.
Huawei may release its own Open Source PC OS soon. We are slowly but surely witnessing the collapse of Western Tech scene.