Great read, but I don't agree with all of these points. OpenAI's technological moat is not necessarily meaningful in a context where the average consumer is starting to recognize ChatGPT as a brand name.
Furthermore, models which fine-tune LLMs are still dependent on the base model's quality. Having a much higher quality base model is still a competitive advantage in scenarios where generalizability is an important aspect of the use case.
Thus far, Google has failed to integrate LLMs into their products in a way that adds value. But they do have advantages which could be used to gain a competitive lead:
- Their crawling infrastructure could allow their to generate better training datasets, and update models more quickly.
- Their TPU hardware could allow them to train and fine-tune models more quickly.
- Their excellent research divisions could give them a head start with novel architectures.
If Google utilizes those advantages, they could develop a moat in the future. OpenAI has access to great researchers, and good crawl data through Bing, but it seems plausible to me that 2 or 3 companies in this space could develop sizeable moats which smaller competitors can't overcome.
Consumers recognizing ChatGPT might just end up like vacuum cleaners; at least in the UK, people will often just call it a "hoover" but the likelihood of it being a Hoover is low.
It is difficult to see where the moat might exist if it's not data and the majority of the workings are published / discoverable. I don't think the document identifies a readily working strategy to defend against the threats it recognises.
This reminds me of Lego's constant campaign about "don't call them Legos" that was similar and it always made me think the Lego company is very pretentious and I avoid them. I don't think that was their desired effect.
I'll also mark myself as skeptical of the brand-as-moat. I think AskJeeves and especially Yahoo probably had more brand recognition just before Google took over than ChatGPT or openai has today.
You're forgetting the phenomenon of the fast follower or second to market effect. Hydrox and Oreos, Newton and Palm, MySpace and Facebook, etc. Just because you created the market doesn't necessarily mean you will own it long term. Competitors often respond better to customer demand and are more willing to innovate since they have nothing to lose.
> in a context where the average consumer is starting to recognize ChatGPT as a brand name.
That brand recognition could hurt them, though. If the widespread use of LLMs results in severe economic disruption due to unemployment, ChatGPT (and therefore OpenAI) will get the majority of the ire even for the effects of their competition.
> context where the average consumer is starting to recognize ChatGPT as a brand name.
Zoom was once that brand name which was equated to a product. Now, people might say "Zoom call", but may use Teams or Meet or whatever. Similarly, people call a lot of robot vacuum cleaners Roombas, even though they might be some other brand.
Brand recognition is one thing, but the actual product used will always depend on what their employer uses, what their mobile OS might use, or what API their products might use.
For businesses, a lot will be about the cost and performance vs "the best available".
Furthermore, models which fine-tune LLMs are still dependent on the base model's quality. Having a much higher quality base model is still a competitive advantage in scenarios where generalizability is an important aspect of the use case.
Thus far, Google has failed to integrate LLMs into their products in a way that adds value. But they do have advantages which could be used to gain a competitive lead: - Their crawling infrastructure could allow their to generate better training datasets, and update models more quickly. - Their TPU hardware could allow them to train and fine-tune models more quickly. - Their excellent research divisions could give them a head start with novel architectures.
If Google utilizes those advantages, they could develop a moat in the future. OpenAI has access to great researchers, and good crawl data through Bing, but it seems plausible to me that 2 or 3 companies in this space could develop sizeable moats which smaller competitors can't overcome.