[quonn]

Charging $200/month is economically only possible if there is not a true market for LLMs or some sort of monopoly power. Currently there is no evidence that this will be the case. There are already multiple competitors and the barrier to entry is relatively low (compared to e.g. the car industry or other manufacturing industries), there are no network effects (like for social networks) and no need to get the product 100% right (like compatibility to Photoshop or Office) and the prices for training will drop further. Furthermore $200 is not free (like Google).

Can anyone name one single widely-used digital product that does _not_ have to be precisely correct/compatible/identical to The Original and that everyone _does_ pay $200/month for?

Therefore, should prices that users pay get anywhere even close to that number, there will naturally be opportunities for competitors to bring prices down to a reasonable level.

[lvl155]

Barrier to entry is actually very very high. Just because we have “open source” models doesn’t mean anyone can enter. And the gap is widening now. I see Anthropic/OpenAI as clear leaders. Opus 4 and its derivative products are irreplaceable for coders since Spring 2025. Once you figure it out and have your revelation, it will be impossible to go back. This is an iPhone moment right now and the network effect will be incredible.

[mathiaspoint]

It's all text and it's all your text. There's zero network effect.

[chis]

I think you forgot to consider the cost of providing the inference.

[quonn]

Well, that could be an additional problem.

My point was not that AI will necessarily be cheaper to run than $200, but that there is not much profit to be made. Of course the cost of inference will form a lower bound on the price as well.