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PhunkyPhil | 6 months ago

So far there hasn't been a transformative use case for LLMs besides the straightforward chat interface (Or some adjacent derivative). Cursor and IDE extensions are nice, but not something that generates billions in revenue.

This means there's two avenues:

1. Get a team of researchers to improve the quality of the models themselves to provide a _better_ chat interface

2. Get a lot of engineers to work LLMs into a useful product besides a chat interface.

I don't think that either of these options are going to pan out. For (1), the consumer market has been saturated. Laymen are already impressed enough by inference quality, there's little ground to be gained here besides a super AGI terminator Jarvis.

I think there's something to be had with agentic interfaces now and in the future, but they would need to have the same punching power to the public that GPT3 did when it came out to justify the billions in expenditure, which I don't think it will.

I think these companies might be able to break even if they can automate enough jobs, but... I'm not so sure.

discuss

YetAnotherNick|6 months ago

Whatsapp had $10M revenue when it was acquired[1]. Lots of so called "chatgpt wrappers" has more revenue than that. While in hindsight Whatsapp acquisition at $19B seems no brainer, no concrete metric pointed to that compared to him investing $19B in AI now.

[1]: https://www.sec.gov/Archives/edgar/data/1326801/000132680114...

utyop22|6 months ago

Dude Zuckerberg bought whatsapp because FB Messenger was losing market share... nothing to do with Whatsapps revenue! Rather Zuckerbergs fear of FB products being displaced.

bonsai_bar|6 months ago

> Cursor and IDE extensions are nice, but not something that generates billions in revenue.

I mean Cursor is already at $500 million ARR...

PhunkyPhil|6 months ago

How many software engineers are there in the world? How many are going to stop using it when model providers start increasing token cost on their APIs?

I could see the increased productivity of using Cursor indirectly generating a lot more value per engineer, but... I wouldn't put my money on it being worth it overall, and neither should investors chasing the Nvidia returns bag.