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Notes -
My personal belief has actually been that the online ad market is inflated, so chatbots not having a high ad ceiling wouldn't surprise me.
True, there was some weird accounting there. What strikes me is that they made $13 billion but spent $7.5 billion on cost of revenue - inference, most likely - and nearly $6 billion in advertising. Or in other words, their business was not profitable before you factor in R&D and training.
I do think this is true, at least partially - I think that journalists were souring on Silicon Valley before AI kicked off, so some of them are going to be biased against it. But I also do think that OpenAI (and Anthropic) are more than happy to dangle substantially false narratives to promote their businesses - and these narratives flatter the interests of investors. In particular, I think that people underappreciated the massive difference between software and AI - the cost of providing software is vastly lower than that of providing compute. But I think there was insufficient appreciation of that with AI, although I do think that is now changing.
This is relevant insofar as I absolutely think investors could be wrong.
souring? They've openly hated Silicon Valley for a very long time.
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