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Is AI in its $5 Uber era? Everyone saying that we're in the 5 dollar Uber stage of AI. What does that mean? If you're old enough to remember, Ubers used to be dirt cheap. But we never paid the real price for an Uber. That was all based on VC subsidies. VCs poured in billions so that Uber could dominate the market, kill the competition, and then eventually raise their prices. Damn do I miss those cheap Ubers though. Open AI and Claude are trying to run the same playbook. They have burnt through billions. I think Open AI has burnt through around 14 billion dollars. Like when you're paying your 20 dollar Open AI plan, 200 dollar Claude plan, that's not the real price. They will raise those prices eventually. But here's where the analogy makes no sense. Uber didn't have open source dirt cheap Chinese competitors flooding the market right now. A Chinese lab called Moon Shot has launched Kimi, which is currently ranked No. 1 for front end development. And Open AI and Anthropic are annoyed as hell. Anthropic has even come out and accused Kimi of basically stealing its model. And with companies already complaining about how expensive AI is, ironically one of them being Uber, and how they're burning through too many tokens, the likelihood of them switching to an open source Chinese model is very high, unless of course the government makes it illegal, which I think may happen.
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