OpenAI Plots Charging $20k a Month for PhD-Level Agents

https://slashdot.org/story/25/03/05/1559207/openai-plots-charging-20000-a-month-for-phd-level-agents

by miles • 1 year ago

46 46 1 year ago

slashdot.org

johntitorjr• 1 year ago

Maybe this will drive up the value of human PhD labor - $240k/year is a lot!

jltsiren• 1 year ago

It depends.

If you want to hire a mid-career PhD in a field that has a real job market outside the academia, and the person already has a stable job they are content with, $240k might not be enough. At least unless the job is particularly interesting.

And the total cost of employment is obviously higher than the nominal salary. (Which is mostly a convenient lie for tax purposes.) If the total cost including benefits, employer-paid taxes, and mandatory insurance is $240k/year, the nominal salary could be $180k or even lower.

dsign• 1 year ago

This.

In many places of Europe, for example, the salary after taxes and mandatory employer contributions become between 30% and 40% of what the employer disburses. The employee is aware that his 20k raise will become more like 6k, and it's in many cases not worth the increase in responsibility, workload or inconvenience. So employee is more likely to seek fulfillment, economical or otherwise, by other means.

But this means that in a few years, people earning 80k per year will be working under the supervision of an AI earning 240k per year. In my sci-fi books, I was leaving that for the 2040s...

blueplanet200• 1 year ago

Doubt it. Increasing the supply of anything rarely results in the price going up.

techpineapple2• 1 year ago

Why are phd-level-agents paid twice as much software developers? Why don’t we see similar value in the real world? $2,000 for high income knowledge workers? None of these numbers make sense.

Also I don’t really have any intuitive sense of what a phd-level agent would be, the cynical part of me thinks it is a marketing term because people mentally associate one with smart.

turnsout• 1 year ago

I'm bullish on agents, but I do wonder what this agent could possibly be doing to justify a $240k salary, which is around market rate for a CEO at an SMB.

It would need to be generating leads and closing sales, or doing the day-to-day work of at least 3 people.

This would have to be backed by something 10X better than the current SOTA models.

dtagames2• 1 year ago

It's nowhere near CEO pay for a tech company, but it is right at what those companies pay for PhD ML experts and also what they pay for the top end of software dev jobs.

borgdefenser• 1 year ago

I could see paying this to have one super intelligence on staff at a large company but that isn't what these models are yet.

Most business tasks and problems you certainly don't need a PhD to solve. Even if you could hire human PhDs at min wage I don't see how most businesses can even leverage that.

If all bank tellers had PhDs in quant finance it would change basically nothing.

dtagames2• 1 year ago

What part of it doesn't make sense? These numbers are very much inline with salaries for jobs at those same levels, in fact terrifyingly so. Someone thinks, incorrectly, that these agents are a direct swap for that experience.

techpineapple2• 1 year ago

Most PHD’s make less than high income knowledge workers and software developers, don’t they?

serjester• 1 year ago

Who knows if this leak is credible, but typical SaaS pricing dictates you should be charging 10 - 25% of the value you bring. That implies this agent is expected to deliver 1 - 2M+ of value, essentially replacing a medium size team of knowledge workers. Even as an AI bull, this level of capability seems far fetched.

add-sub-mul-div• 1 year ago

Are the laws and lessons we've learned in the past still relevant in this nascent age of open grift?

jmpman4• 1 year ago

I used to work on storage software pricing. We would charge 60% of the value it would bring our customer - based off of the classic behavioral game theory experiment, Dollar Auction. Our customers surprisingly didn’t object.

supermatt• 1 year ago

How did you calculate value - if it's based on savings over traditional storage, wouldn't the profit also be capped by the same amount?

adammarples• 1 year ago

How is the dollar auction remotely a model for bidding on software and how did it help you arrive at 60%?

juped2• 1 year ago

Sad and pathetic if true. How unsustainable is their capital structure, exactly? Worse than I naively suspected, I suppose?

jamesy0ung• 1 year ago

OpenAI is a financial black hole, burning cash faster than it can raise it, with a business model built on hype and a product (ChatGPT) that's easily commoditized. Their revenue projections are delusional, and the core API business is surprisingly weak, suggesting the entire generative AI market might be overblown.

https://www.wheresyoured.at/oai-business/

acchow• 1 year ago

We're in the early days, like back when Uber offered $2.50 rides anywhere in San Francisco. They burned through tons of cash for years but had $9.8bn net income last year.

juped2• 1 year ago

I don't care too much about revenues and expenses exactly, but about the sustainability of their capital structure. "Big tranches of convertible debt within a couple years of converting" does sound like a bad sign.

InkCanon• 1 year ago

It seems that way but I think it's quite possible in tech for things to rapidly change. E.g. if OpenAI starts quantising all their models, which can maybe reduce their compute costs by 80%, it would be profitable, but make some number of customers leave. Certain other headwinds like decreasing cost of cost per teraflop helps them.

Like Uber I suspect their business model is simply to capex until all their enemies are dead, then jack up prices.

alberth• 1 year ago

Correct me if I’m wrong but wouldn’t this single PhD-level agent be able to be used by everyone in your company.

Paying $240k/year for company-wide access (if you’re a Fortune 500 company), isn’t bad.

pyuser583• 1 year ago

This is why the price is so high. It isn’t just a person at a desk. It’s a service anyone can access.

It also never calls in sick or sexually harasses an intern.

croes3• 1 year ago

That person would be liable for their mistakes.

Who is liable for the agent’s mistakes.

koshergweilo• 1 year ago

Responsible, maybe, but Liable? I don't think so. So long as you genuinely try to do your best and don't break the law, the a company can do is fire you.

fennecfoxy• 1 year ago

Well that's what c levels are supposedly for, but all they ever get is golden handshakes and parachute off to the next company to cause problems at.

maxglute• 1 year ago

AI agent going to be the keener that works 24/7 365 while humans check the work andtake the blame.

alok-g• 1 year ago

I am guessing the capability and capacity would be limited in some way by compute. They are probably thinking of a dedicated agent that could be computing 24/7 trying to solve some problem assigned.

ilrwbwrkhv• 1 year ago

I have a feeling they will try more and more outrageous experiments to somehow get some money

_mitterpach• 1 year ago

Note that OpenAI is notoriously terrible at pricing. Their prices are based on gut-feel and marketing, more than being priced on what customers would pay and what is profitable.

Building on top of this would be a terrible idea. The bubble is going to burst, OpenAI will stop getting investment money and will need to actually start being, you know, profitable. They will do that by milking all their actual existing customers - expect price to at least double in the following years.

imtringued• 1 year ago

Does anyone else get the feeling that OpenAI's PhD-Level Agents will secretly be powered by underpaid PhDs?

torginus• 1 year ago

My question here is if they do bring to market what they claim, as in AI fully capable of replacing humans, what's stopping them of just simply cloning the business model of every company running on knowledge work, and not even bothering to lease out these AI employees?

hypercube33• 1 year ago

In a gold rush you'll make money selling shovels as the saying goes

nullbyte808• 1 year ago

PhD level knowledge with the reasoning ability of a mentally challenged 8-year-old. lmao

OpenAI Plots Charging $20k a Month for PhD-Level Agents

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