OpenAI declares 'code red' as Google catches up in AI race

https://www.theverge.com/news/836212/openai-code-red-chatgpt

by goplayoutside • 8 months ago

819 929 8 months ago

Source: https://www.wsj.com/tech/ai/openais-altman-declares-code-red... (https://news.ycombinator.com/item?id=46118396)

skywhopper• 8 months ago

    There will be a daily call for those tasked
    with improving the chatbot, the memo said,
    and Altman encouraged temporary team transfers
    to speed up development.

Truly brilliant software development management going on here. Daily update meetings and temporary staff transfers. Well known strategies for increasing velocity!

lubujackson• 8 months ago

Don't forget scuttling all the projects the staff has been working overtime to complete so that they can focus on "make it better!" waves hands frantically

another_twist3• 8 months ago

"The results of this quarter were already baked in a couple of quarters ago"

- Jeff Bezos

Quite right tbh.

tiahura5• 8 months ago

Like when OpenAI started experiencing a massive brain drain.

giancarlostoro3• 8 months ago

I've had ideas for how to improve all the different chatbots for like 3 years, nobodys has implemented any of them (usually my ideas get implemented in software somehow the devs read my mind, but AI seems to be stuck with the same UI for LLMs), none of these AI shops are ran by people with vision it feels like. Everyone's just remaking a slightly better version of SmarterChild.

theplatman3• 8 months ago

i agree - it shows a remarkable lack of creativity that we're still stuck with a fairly subpar UX for interacting with these tools

whiplash4515• 8 months ago

Did you open-source / publish these ideas?

simianwords3• 8 months ago

I really want a UI that visualises branching. I would like to branch out of specific parts of the responses and continue the conversation there but also keep the original conversation. This seems to be a very standard feature but no one has developed it.

alwa• 8 months ago

Oh man, I hadn’t thought of SmarterChild in dog’s years! It was an early AIM chatbot, and felt like magic at the time. Looking back it feels like there’s a clear through-line from it (and the rest of ActiveBuddy’s menagerie) to the ChatGPTs of the world today…

For today’s lucky 10,000, here’s a Vice retrospective from 2016:

https://www.vice.com/en/article/a-history-of-smarterchild/

mlmonkey• 8 months ago

The beatings will continue until morale^H^H^H^H^H^H chatGPT improves...

trymas• 8 months ago

…someone even wrote a book about this. Something about “mythical men”… :D

zingababba2• 8 months ago

Needs an update re: mythical AI.

simianwords3• 8 months ago

Its easy to dismiss it but what would you do instead?

TheOccasionalWr• 8 months ago

What if they make 2 daily calls, that would surely improve the velocity by 2 times!

rf15• 8 months ago

This sounds like their medicine might be worse than what they're currently doing...

rappatic• 8 months ago

the company will be delaying initiatives like ads, shopping and health agents, and a personal assistant, Pulse, to focus on improving ChatGPT

There's maybe like a few hundred people in the industry who can truly do original work on fundamentally improving a bleeding-edge LLM like ChatGPT, and a whole bunch of people who can do work on ads and shopping. One doesn't seem to get in the way of the other.

jasonthorsness• 8 months ago

ha what an incredible consumer-friendly outcome! Hopefully competition keeps the focus on improving models and prevents irritating kinds of monetization

another_twist3• 8 months ago

If there's no monetization, the industry will just collapse. Not a good thing to aspire to. I hope they make money whilst doing these improvements.

apparent• 8 months ago

Just like uber rides funded by VC cash was great...until the VC money ran out and prices jumped to fill the gap.

crazygringo• 8 months ago

If they don't start on ads and shopping, they're going to go out of business.

I'd rather a product that exists with ads, over one that's disappeared.

The fact is, personal subscriptions don't cover the bills if you're going to keep a free tier. Ads do. I don't like it any more than you do, but I'm a realist about it.

ma2rten• 8 months ago

Delaying doesn't necessarily mean they stop working on it. Also it might be a question of compute resource allocation as well.

whiplash4515• 8 months ago

The bottleneck isn’t the people doing the work but the leadership’s bandwidth for strategic thinking

tiahura5• 8 months ago

How is strategic thinking going to produce novel ideas about neural networks?

kokanee• 8 months ago

I think it's a matter of public perception and user sentiment. You don't want to shove ads into a product that people are already complaining about. And you don't want the media asking questions like why you rolled out a "health assistant" at the same time you were scrambling to address major safety, reliability, and legal challenges.

sien• 8 months ago

If only they had a tool that they claim could help with things like that....

rob74• 8 months ago

I for one would say, the later they add the "ads" feature, the better...

saintfire• 8 months ago

Eh, get the enshittification done sooner than later so people aren't fooled into thinking it's actually worth anyone's time.

logsr• 8 months ago

There are two layers here: 1) low level LLM architecture 2) applying low level LLM architecture in novel ways. It is true that there are maybe a couple hundred people who can make significant advances on layer 1, but layer 2 constantly drives progress on whatever level of capability layer 1 is at, and it depends mostly on broad and diverse subject matter expertise, and doesn't require any low level ability to implement or improve on LLM architectures, only understanding how to apply them more effectively in new fields. The real key thing is finding ways to create automated validation systems, similar to what is possible for coding, that can be used to create synthetic datasets for reinforcement learning. Layer 2 capabilities do feed back into improved core models, even if you have the same core architecture, because you are generating more and improved data for retraining.

techblueberry4• 8 months ago

Far be it from me to backseat drive for Sam Altman, but is the problem really that the core product needs improvement, or that it needs a better ecosystem? I can't imagine people are choosing they're chatbots based on providing the perfect answers, it's what you can do with it. I would assume google has the advantage because it's built into a tool people already use every day, not because it's nominally "better" at generating text. Didn't people prefer chatgpt 4 to 5 anyways?

jinushaun• 8 months ago

If that was the case, MS would be on top given how entrenched Windows, Office and Outlook are.

tim3338• 8 months ago

ChatGPT's thing always seems to have been to be the best LLM, hence the most users without much advertising and the most investment money to support their dominance. If they drop to second or third best it may cause them problems because they rely on investor money to pay the rather large bills.

Currently they are not #1 in any of the categories on LLM arena, and even on user numbers where they have dominated, Google is catching up, 650m monthly for Gemini, 800m for ChatGPT.

Also Google/Hassabis don't show much sign of slacking off (https://youtu.be/rq-2i1blAlU?t=860)

Funnily enough Google had a "Chat Bot Is a ‘Code Red’ for Google’s Search Business" thing back in 2022 but seem to have got it together https://www.nytimes.com/2022/12/21/technology/ai-chatgpt-goo...

ronnier• 8 months ago

There's maybe like a few hundred people in the industry

My guess is that it's smaller than that. Only a few people in the world are capable of pushing into the unknown and breaking new ground and discoveries

rashidujang• 8 months ago

There will be a daily call for those tasked with improving the chatbot, the memo said, and Altman encouraged temporary team transfers to speed up development.

It's incredible how 50 year-old advice from The Mythical Man-Month are still not being heed. Throw in a knee-jerk solution of "daily call" (sound familiar?) for those involved while they are wading knee-deep through work and you have a perfect storm of terrible working conditions. My money is Google, who in my opinion have not only caught up, but surpassed OpenAI with their latest iteration of their AI offerings.

tiahura5• 8 months ago

Also, google has plenty of (unmatched?) proprietary data and their own money tree to fuel the money furnace.

FinnKuhn• 8 months ago

As well as their own hardware and a steady cash flow to finance their AI endevours for longer.

dathinab• 8 months ago

the thought that this might be done one recommendation of ChatGPT has me rolling

think about it, with how much bad advice is out there in certain topics it's guaranteed that ChatGPT will promote common bad advice in many cases

amelius4• 8 months ago

Imho it just shows how relatively simple this technology really is, and nobody will have a moat. The bubble will pop.

deelowe• 8 months ago

Not exactly. Infra will win the race. In this aspect, Google is miles ahead of the competition. Their DC solutions scale very well. Their only risk is that the hardware and low level software stack is EXTREMELY custom. They don't even fully leverage OCP. Having said that, this has never been a major problem for Google over their 20+ years of moving away from OTS parts.

simianwords3• 8 months ago

amazing how the bubble pops either from the technology either being too simple or being too complex to make a profit

wlesieutre• 8 months ago

Besides, can't they just allocate more ChatGPT instances to accelerating their development?

woeirua• 8 months ago

Wait, shouldn't their internal agents be able to do all this work by now?

JacobAsmuth• 8 months ago

They have a stated goal of an AI researcher for 2028. Several years away.

palmotea• 8 months ago

It's incredible how 50 year-old advice from The Mythical Man-Month are still not being heed.

A lot of advice is that way, which is why it is advice. If following it were easy everyone would just do it all the time, but if it's hard or there are temptations in the other direction, it has to be endlessly repeated.

Plus, there are always those special-snowflake guys who are "that's good advice for you, but for me it's different!"

Also it wouldn't surprise me if Sam Altman's talents aren't in management or successfully running a large organization, but in machiavellian manipulation and maneuvering.

ryandvm• 8 months ago

Don't forget the bleak subtext of all this.

All these engineers working 70 hour weeks for world class sociopaths in some sort of fucked up space race to create a technology that is supposed to make all of them unemployed.

tim3338• 8 months ago

You can have a more upbeat take on it all.

p1esk• 8 months ago

These engineers make enough money to comfortably retire by the time they are replaced with AI.

bluecalm2• 8 months ago

They are paid exceptionally well though. Way above market rate for their skill set was at any point in history. Work long hours for a few years and enjoy freedom for the rest of your life. That's a deal a lot of people would take. No need to feel sorry for the ones in position to actually get the choice.

wiseowise• 8 months ago

technology that is supposed to make all of them unemployed.

To make all of us (other poor fuckers) unemployed.

bgwalter• 8 months ago

There is always a daily call if a U.S. startup fails. Soon there will be quadrants and Ikigai Venn diagrams on the internal Slack.

Fricken3• 8 months ago

I take this code red as a red flag. Open AI should continue to concern itself with where it will be 5 years from now, not lose sight over concern about where it will 5 months from now.

theplatman3• 8 months ago

open ai is at risk of complete collapse if it cannot fulfill its financial obligations. if people willing to give them money don't have faith in their ability to win the AI race anymore, then they're going out of business.

Fricken3• 8 months ago

Exactly. They aren't going to win the AI race chasing rabbits at the expense of long-term goals. We're 3 years into a 10 year build-out. Open AI and it's financiers are too impatient, clearly, and they're fucking themselves. Open AI doesn't need to double it's revenue to meet expectations. They need to 50x their revenue to meet expectations. That's not the kind of problem you solve by working through the weekend.

dbbk• 8 months ago

Spoiler alert they're going to go out of business

dylan604• 8 months ago

Back in the day before Adobe bought Macromedia, there was a constant back and forth between Illustrator and Freehand where each release would better the competitor at least until the competitor's next release.

Does anyone in AI think about 5 years from now?

Fricken3• 8 months ago

Google is well positioned because they were thinking about AI from the earliest days. The race not a sprint, it just seems that way.

whiplash4515• 8 months ago

It’s actually code yellow

felixfurtak6• 8 months ago

or maybe even code brown

Phelinofist2• 8 months ago

IMHO Gemini surpassed ChatGPT by quite a bit - I switched. Gemini is faster, the thinking mode gives me reliably better answers and it has a more "business like" conversation attitude which is refreshing in comparison to the over-the-top informal ChatGPT default.

cj2• 8 months ago

Is there a replacement for ChatGPT projects in Gemini yet?

That's the only ChatGPT feature keeping me from moving to Gemini. Specifically, the ability to upload files and automatically make them available as context for a prompt.

tiahura5• 8 months ago

Isn’t that what gems are?

hek2sch• 8 months ago

Isn't that already nouswise? Nouswise would ground answers based on low level quotes plus you get an api from your projects.

Workaccount2• 8 months ago

Looks like it is coming out soon:

https://www.androidauthority.com/google-gemini-projects-2-36...

mvdtnz2• 8 months ago

[Gemini] has a more "business like" conversation attitude which is refreshing in comparison to the over-the-top informal ChatGPT default.

Maybe "business like" for Americans. In most of the world we don't spend quite so much effort glazing one another in the workplace. "That's an incredibly insightful question and really gets to the heart of the matter". No it isn't. I was shocked they didn't fix this behavior in v3.

MangoToupe• 8 months ago

Maybe "business like" for Americans. In most of the world we don't spend quite so much effort glazing one another in the workplace. "That's an incredibly insightful question and really gets to the heart of the matter". No it isn't. I was shocked they didn't fix this behavior in v3.

I presume rejecting the glazing is exactly the behavior they're praising Google for. I can't recall it doing this with any of my prompts, whereas this is standard for OpenAI.

Phelinofist2• 8 months ago

Not quite - I'm German :P

But as a sibling has said, the "super nice question homie" texts are not coming (as much) in Gemini as in ChatGPT (for me). I know that you can tune ChatGPTs persona, but that changed also the answer quality for me for the worse.

devnullbrain2• 8 months ago

Ironically, the thing that annoys me most about Gemini is the Discord-esque loading messages in the CLI. Twee is one thing: mixing twee with serious hints is worse.

mschulkind• 8 months ago

You can turn that off in /settings

energy1233• 8 months ago

I've found Gemini 3.0 Pro to be bad at multi turn conversation and instruction following. It ignores your follow up question unless you draw attention to it with caps or something.

Not a major complaint for technical work where you don't even want to do much multi turn conversation. Just an observation.

pengaru• 8 months ago

Surely they can just use AI to go faster and attend their daily calls for them...

poszlem• 8 months ago

To be honest, this is the first month in almost a year when I didn't pay for ChatGPT Pro and instead went for Gemini Ultra. It's still not there for programming, where I use Claude Max, but for my 'daily driver' (count this, advice on that, 'is this cancer or just a headache' kind of thing), Gemini has finally surpassed ChatGPT for me. And I used to consider it to be the worst of the bunch.

I used to consider Gemini the worst of the bunch, it constantly refused to help me in the past, but not only has it improved, ChatGPT seems to have gone down the 'nerfing' road where it now flat out refuses to do what I ask it to do quite often.

mrkramer• 8 months ago

Google is shivering! /s

dwa3592• 8 months ago

why couldn't GPT5.1 improve itself? Last I heard, it can produce original math and has phd level intelligence.

throwacct2• 8 months ago

C'mon man. You know why...

teaearlgraycold• 8 months ago

I believe it was Sam Altman that said software engineers wouldn't have jobs by the end of the year. They still have a few weeks to make good on that.

ares6232• 8 months ago

I bet my retirement funds on that promise!

vbezhenar• 8 months ago

That was their gamble. Seems it didn't play out.

alecco4• 8 months ago

OpenAI was founded to hedge against Google dominating AI and with it the future. It makes me sad how that was lost for pipe dreams (AGI) and terrible leadership.

I fear a Google dystopia. I hope DeepSeek or somebody else will counter-balance their power.

bryanlarsen• 8 months ago

That goal has wildly succeeded -- there are now several well financed companies competing against Google.

The goal was supposed to be an ethical competitor as implied by the word "Open" in their name. When Meta and the Chinese are the most ethical of the competitors, you know we're in a bad spot...

alecco4• 8 months ago

I said DeepSeek because they are very open (not just weights). A young company and very much unlike Chinese Big Tech and American Big Tech.

epiccoleman• 8 months ago

Without having followed the issue of "AI Ethics" that closely, Anthropic seems to me to be relatively non-evil, too.

tiahura5• 8 months ago

Doesn’t it seem likely that it all depends on who produces the next AIAYN? Things go one way if it’s an academic, and another way if it’s somebody’s trade secret.

tim3338• 8 months ago

AGI was the thing from the start. From the OpenAI Charter:

OpenAI’s mission is to ensure that artificial general intelligence (AGI) ... benefits all of humanity.

I agree with you on the leadership.

sometimes_all4• 8 months ago

For regular consumers, Gemini's AI pro plan is a tough one to beat. The chat quality has gotten much better, I am able to share my plan with a couple more people in my family leading to proper individual chat histories, I get 2 TB of extra storage (which is also sharable), plus some really nice stuff like NotebookLM, which has been amazing for doing research. Veo/Nanobanana are nice bonuses.

It's easily worth the monthly cost, and I'm happy to pay - something which I didn't even consider doing a year ago. OpenAI just doesn't have the same bundle effect.

Obviously power users and companies will likely consider Anthropic. I don't know what OpenAI's actual product moat is any more outside of a well-known name.

piva002• 8 months ago

Through my work I have access to Google's, Anthropic's, and OpenAI's products, and I agree with you, I barely touch OpenAI's models/products for some reason even though I have total freedom to choose.

OutOfHere3• 8 months ago

I strongly advise never using Google's Drive storage. They're known to scan all content, and to disable all access if even a single file is "problematic", often misclassified by a bot. If you do use the storage, do backup all your files, and be ready to lose access at any time, with no way to reach any intelligent human.

throwacct2• 8 months ago

Which product do you recommend? OneDrive? Dropbox?

devsda• 8 months ago

Since we are on the topic of bans & Google, I have a question.

How likely or difficult is it for Google to engage in, for lack of better word, "thought policing"?

You ask your "private" AI assistant to answer a naughty question or help with problematic task(from Google's hidden list) and then you eventually face the ban hammer.

Did anybody ever get banned for searching the wrong keywords?

sometimes_all4• 8 months ago

I agree with you 100%. We do syncs to another non-google storage account anyway, plus the google accounts are primarily for Android phone usage because photos and videos take up quite a big chunk of space now; they do not have any legitimately important files stored outside of photos sync and phone backups, so there is no deep loss if the account gets banned outside of some inconveniences.

acuozzo• 8 months ago

Solution: Use Google Drive to backup a VeraCrypt volume?

beAbU2• 8 months ago

This has never happened to me in more than 5 years of paying for Google Drive. And my drive is chock full of bootleg books and movies and stuff.

Having said that, an offline backup of a couple of terabytes will rarely break the bank and is not a bad idea at all.

I probably need to get on that.

carlosjobim2• 8 months ago

If we stop for a while and really consider the value of AI tools, then comparing them on price doesn't make much sense. Any of these tools give hundreds, thousands, or tens of thousands of dollars of value per month to the user. With that in consideration they should mostly be compared on quality.

aftbit3• 8 months ago

The same thing is true for a _ton_ of tech products. My home internet plan easily gives me more than $1000 in value per month. My cell phone hardware probably gives me $2000+ in value over even a short 2 year life. Customers still tend to choose the cheapest option that meets requirements.

sometimes_all4• 8 months ago

With that in consideration they should mostly be compared on quality

Take a look at the comments in the thread and tell me whether there is a consensus on which AI has the best "quality". Gemini, Claude, ChatGPT are all stochastic machines; they'll give me a different output at different times for the very same query, with differences in quality each time within themselves, let alone other products.

I did my own checks; newer Gemini's output is consistently "good enough" for me and my family now, we individually do not use the full extent of the Pro plan (collectively, we do), and NotebookLM is something which more than one of us uses everyday; Image generation is something we use once a week or so. Given all this, the feature breadth within Gemini covers all bases for us, with a significant catch-up in quality compared to earlier to a point that we don't really need to look elsewhere for now.

Plus, for us USD 20 is not a small amount; it's equivalent to one of our larger utility bills we need to pay for every month. So price is definitely an important point of consideration.

venusenvy47• 8 months ago

Do you happen to know if the AI features of the Google One 5TB plan is equivalent to the 2TB AI pro plan? It is so difficult to understand what actually comes with their plans, and I want to have the 5 TB storage for backups.

sometimes_all4• 8 months ago

Yeah it was an absolute nightmare trying to figure out the difference, and I still do not know the correct answer to this, and by the looks of it, neither does Google support, because they were as clueless as I was when I asked them about it.

One thing I read on a reddit thread [1] was that the AI pro 2 TB plan explicitly allows sharing the AI and storage benefits when you enable family sharing on them, while the 5 TB plan doesn't.

However, when I went to sign up, the 5 TB plan wasn't available at all! It's only their lite and basic plans (the one with 30 and 100 GB of storage); the 5TB one only showed up after I signed up for the pro plan, and judging by how the UX looked, you pay an extra amount on top of your AI pro plan.

Now I definitely need family sharing, but I don't need the full 2 TB, let alone 5 TB, so I didn't bother checking further about the 5TB plan.

Also, I am in India, maybe things are different in your region?

[1] https://www.reddit.com/r/GoogleOne/comments/1nib21a/solved_g...

beAbU2• 8 months ago

From what I can see the 2TB AI pro and 5TB (non AI) are the same, except the google drive storage.

The difference between the AI and non-AI 2TB plan is 1000 AI "credits" (tokens?) vs 200. €120 p/a difference between the two for me which is huge.

adrr• 8 months ago

Gemini also will answer most queries where ChatGpt won't do a lot of things. Example: "Create an image of Snow white". This will give the stand "Violates our content policy" even though the story was written hundreds of years ago. You can even point out the story is in the public domain and it still won't do it.

I remember when it wouldn't even give me the lyrics to the star spangled banner. https://news.ycombinator.com/item?id=44832990#44833365

theoldgreybeard• 8 months ago

You can't make a baby in 1 month with 9 women, Sam.

vivzkestrel• 8 months ago

In one of the Indian movies, there is a rather funny line that goes like this "tu jiss school se padh kar aaya hai mein uss school ka headmaster hoon". It would translate like this "The school from which you studied and came? I am the principal of that school". Looks like Google is about to show who the true principal is

shaftway2• 8 months ago

I think the most relevant quote is from Futurama:

"Eh-de-de-de-de. Don't quote me regulations... I co-chaired the committee that reviewed the recommendation to revise the color of the book that regulation is in. We kept it gray."

anileated2• 8 months ago

Probably all of the ML foundation like transformers which OpenAI used to create its chatbot was originally developed at Google.

sumedh2• 8 months ago

The people who wrote that paper left Google though.

spwa42• 8 months ago

We are in a pretty amazing situation. If you're willing to go down 10% in benchmark scores, you easily 25% your costs. Now with Deepseek 3.2 another shot across the bow.

But if the ML, if SOTA intelligence becomes basically a price war, won't that mean that Google (and OpenAI and Microsoft and any other big model) lose big? Especially Google, as the margin even Google cloud (famously a lot lower than Google's other businesses) requires to survive has got to be sizeable.

golfer6• 8 months ago

Google trains its own AI with TPU's, which are designed in house. Google doesn't have to pay retail rates for Nvidia GPUs, like other hyperscalers in the AI rat race. Therefore, Google trains its AI for cheaper than everyone else. I think everyone else "loses big" other than Google.

tvshtr• 8 months ago

Well, those who are aware of this definitely know what it is leading to. But most will act shocked surely.

spwa42• 8 months ago

But ... I don't understand why this is supposedly such a big deal. Look into it, calculate, and a very different picture comes forward, nVidia reportedly makes about 70% margin on their sales (which is COGS, in other words nVidia still pays about $1400 for chips and memory to produce a $4500 RTX5090 card, and that cost is rising fast).

When you include research for current and future cards, that margin drops to 55-60%.

When you include everything on their cash flow statement it drops to about 50%.

And this is disregarding what Michael Burry pointed out: you really should subtract their stock dilution which is due to stock-based compensation, or about 0.2% of 4.6 trillion dollars per year. Michael Burry's point is of course that this makes for slightly negative shareholders' equity, ie. brings the margin to just under 0, which is mathematically true. But for this argument let's very generously say it eats about another 10% out of that margin. As opposed to the 50% it mathematically eats.

Google and Amazon will have to be less efficient than nVidia, because they're making up ground. Let's very generously say that's another 10%, maybe 20%.

So really, for Google making their own chips saves them at best 30% to 40% on the price, generously. And let's again ignore that Google's claim is that they're 30% to 50% less efficient than nVidia chips, which for large training runs translates directly to dollars.

So for Google, TPUs are just about revenue neutral. It probably allows them to have more chips, more compute than they'd otherwise have, but it doesn't save them money over buying nVidia chips. Frankly, this conclusion sounds "very Google" to me.

It's exactly the sort of thing I'd expect Google to do. VERY impressive technical accomplishment ... but can be criticized for being beside the point. It doesn't actually matter. As an engineer I applaud that they do it, please keep doing it, but it's not building a moat, not building revenue or profit, so the finance guy in me is screaming "WHY????????"

At best, for Google, TPUs mean certainty of supply, relative to nVidia (whereas supplier contracts could build certainty of supply down the chain)

zingababba2• 8 months ago

Does anyone have a link to the contents of the memo?

mensetmanusman2• 8 months ago

Conspiracy time.

be Google
watch regulators circle like vultures
realize antitrust heat is rising faster than stock buybacks can hide
notice a small lab called OpenAI making exotic tech and attracting political fascination
calculate that nothing freezes regulators like an unpredictable new frontier
decide to treat OpenAI as an accidental firebreak
let them sprint ahead unchecked watch lawmakers panic about hypothetical robot uprisings instead of market concentration
antitrust hearings shift from “break up the giants” to “what is AGI and should we fear it”
Google emerges looking ancient, harmless, almost quaint
pressure dissipates
execute phase two: acceleration roll out model updates in compressed cycles
flood the web with AI-powered services
redefine “the internet” as “whatever Google’s infrastructure indexes”
regulators exhausted from chasing OpenAI’s shadow
Google walks back onto the throne, not by hiding power, but by reframing it as inevitability conspiracy theorists argue whether this was 5D chess or simple opportunism
Google search trends spike for “how did this happen”
the answer sits in plain sight:
attention is all you need

newyankee• 8 months ago

there is enough proof that they had a chatbot internally which was quite competitive but was not pushed through for all these fears, it seems they were always confident that they could catch up and scaling laws were their internal defense.

The question now though is neither might have expected Chinese labs to catch up so fast.

mensetmanusman2• 8 months ago

China releasing open models only helps the big companies make more efficient inference.

Maybe they don’t realize that the money will be in the inference compute and there is limited applicability for low flops inference.

Ie. All the breakthroughs they share for free will immediately improve profitability of the ai compute clusters.

Not sure why people think otherwise.

breppp• 8 months ago

That would be believable if you forget the sheer incompetence and bureaucracy Google was/is filled with

thevillagechief• 8 months ago

This is one conspiracy theory I've actually considered. Google waited until the Chrome outcome to come out swinging.

spicybbq• 8 months ago

It's a fun idea but there's ample public reporting about how Google reacted to the rise of ChatGPT. There is reporting that Google was taken by surprise. You can be skeptical of that, but that's what the reporting says. ChatGPT went viral in Nov/Dec 2022, and by February or March Google was scrambling to stand up Bard as a viable competitor.

https://web.archive.org/web/20221221100606/https://www.nytim...

https://web.archive.org/web/20230512133437/https://www.theve...

TechRemarker• 8 months ago

Heard all the news how Gemini 3 is passing everyone on benchmarks, so quickly tested and still find it a far cry from ChatGPT in real world use when testing questions on both platforms. But importantly the ChatGPT app experience at least for iPhone/Mac users is drastically superior vs Google which feels very Google still. So Gemini would have to be drastically better answer wise than ChatGPT to lure users from a better UI/UX experience to Gemini. But glad to see competition since certainly don't want only one winner in this race.

jiggawatts5• 8 months ago

Curiously, I had the opposite experience, except for Deep Research mode where after the latest update the OpenAI offering has become genuinely amazing. This is doubly ironic because Gemini has direct API access to Google search!

observationist• 8 months ago

Google search is awful. I don't think they can put lipstick on that particular pig and expect anyone to think it's beautiful.

threecheese• 8 months ago

It is good, but Pro subscribers get only five per month. After that, it’s a limited version, and it’s not good (normal 5.1 gives more comprehensive answers than DR Limited).

tapoxi• 8 months ago

Its really hard to measure these things. Personally I switched to Gemini a few months ago since it was half the cost of ChatGPT (Verizon has a $10/month Google AI package). I feel like I've subconsciously learned to prompt it slightly differently and now using OpenAI products feels disappointing. Gemini tends to give me the answer I expect, Claude follows close behind, I get "meh" results from OpenAI.

I am using Gemini 3 Pro, I rarely use Flash.

golfer6• 8 months ago

I couldn't even get ChatGPT to let me download code it claimed to program for me. It kept saying the files were ready but refused to let me access or download anything. It was the most basic use case and it totally bombed. I gave up on ChatGPT right then and there.

It's amazing how different people have wildly varying experiences with the same product.

embedding-shape3• 8 months ago

It's because comparing their "ChatGPT" experience with your "ChatGPT" experience doesn't tell anyone anything. Unless people start saying what models they're using and prompts, the discussions back and forth about what platform is the best provides zero information to anyone.

bdbdbdb• 8 months ago

Since LLMs are non deterministic it's not that amazing. You could ask it the same question as me and we could both get very different conversations and experiences

dudeinhawaii2• 8 months ago

Did you wait a while before downloading? The links it provides for temporary projects have a surprisingly brief window where you can download them. I've had similar experience when even waiting 1 minute to download the file.

_whiteCaps_• 8 months ago

The same thing happens to me in Claude occasionally. I have to tell it "Generate a tar.gz archive for me to download".

hodgehog116• 8 months ago

That's really fascinating. Every real world use case I've tried on Gemini (especially math-related) absolutely slaughtered the performance of ChatGPT in speed and quality, not even close. As an Android user, the Gemini app is also far superior, since the ChatGPT app still doesn't properly display math equations, among plenty of other bugs.

bdhtu• 8 months ago

What do you mean? It renders LaTex fine on Android.

kristofferR• 8 months ago

Try doing some more casual requests.

When I asked both ChatGPT 5.1 Extended Thinking and Gemini 3 Pro Preview High for best daily casual socks both responses were okay and had a lot of the same options, but while the ChatGPT response included pictures, specs scraped from the product pages and working links, the Gemini response had no links. After asking for links, Gemini gave me ONLY dead links.

That is a recurring experience, Gemini seems to be supremely lazy to its own detriment quite often.

A minute ago I asked for best CR2032 deal for Aqara sensors in Norway, and Gemini recommended the long discontinued IKEA option, because it didn't bother to check for updated information. ChatGPT on the other hand actually checked prices and stock status for all the options it gave me.

verdverm6• 8 months ago

It's generally anecdotal and vibes when people make claims that some AI is better than another for things they do. There are too many variables and not enough eval for any of it to hold water imo. Personal preferences, experience, brand loyalty, and bias at play too

it's contemporary vim vs emacs at this point

croes• 8 months ago

One might think that benchmarks do not say much about individual usage and that an objective assessment of the performance of AIs is difficult.

At least, thanks to the hype, RAM and SSDs are becoming more expensive, which eats up all the savings from using AI and the profits from increased productivity /s?

dudeinhawaii2• 8 months ago

I have to agree with you but I'll remain a skeptic until the preview tag is dropped. I found Gemini 2.5 Pro to be AMAZING during preview and then it's performance and quality unceremoniously dropped month after month once it went live. Optimizations in favor of speed/costs no doubt but it soured me on jumping ship during preview.

Anthropic pulled something similar with 3.6 initially, with a preview that had massive token output and then a real release with barely half -- which significantly curtails certain use cases.

That said, to-date, Gemini has outperformed GPT-5 and GPT5.1 on any task I've thrown at them together. Too bad Gemini CLI is still barely useful and prone to the same infinite loop issues that have plagued it for over a year.

I think Google has genuinely released a preview of a model that leapfrogs all other models. I want to see if that is what actually makes it to production before I change anything major in my workflows.

deaux7• 8 months ago

You're using paid ChatGPT, set to 5.1 with Thinking?

tootie2• 8 months ago

I would further argue the apps are all like 99% the same. And also work just fine through a browser without installing anything

r_lee• 8 months ago

I'm confused as well, it hallucinated like crazy

like it seems great, but then it's just bullshitting about what it can do or whatever

xnx3• 8 months ago

So Gemini would have to be drastically better answer wise than ChatGPT to lure users from a better UI/UX experience to Gemini.

or cheaper/free

binarymax• 8 months ago

Benchmaxxing galore by lots of teams in this space.

emp17344• 8 months ago

I think it’s entirely possible that AI actually has plateaued, or has reached a point where a jump in intelligence comes at the cost of reliability.

lanthissa2• 8 months ago

they're deep into a redesign of the gemini app, idk when it will be released or if its going to be good, but at least they agree with you and are putting significant resources into fixing it.

tmaly• 8 months ago

I did notice a bug on the iPhone, even with app background refresh, if the phone shuts off the screen, a prompt that was processing stalls out.

par• 8 months ago

Yeah, hate to say but for me a big thing is i still couldn't separate my Gemini chats into folders. I had ChatGPT export some profiles and history and moved it into Gemini, and 1) when Gemini gave me answers i was more pleased but 2) Gemini was a bit more rigorous on guard rails, which seems a bit overly cautious. I was asking some pretty basic non-controversial stuff.

bitpush2• 8 months ago

Looks like it is coming.

https://www.androidauthority.com/google-gemini-projects-2-36...

machomaster2• 8 months ago

If I research anything close to controversial, I use Grok. Its no-censorship attitude is great.

j45• 8 months ago

Training and gaming for the benchmarks is different than actual use.

kranke1553• 8 months ago

Gemini comes with the 1.99 Google One plan. So I use that

BeetleB3• 8 months ago

Actually, it comes with the free plan. The $1.99 plan doesn't give you any more AI capabilities. Only at the $19.99/mo plan do you get more.

https://one.google.com/about/#compare-plans

mrcwinn2• 8 months ago

This is exactly my experience. And it's funny -- this crowd is so skeptical of OpenAI... so they prefer _Google_ to not be evil? It's funny how heroes and villains are being re-cast.

potsandpans• 8 months ago

What are your primary usecases? Are you mostly using it as a chatbot?

I find gemini excels in multimodal areas over chatgpt and anthropic. For example, "identify and classify this image with meta data" or "ocr this document and output a similar structure in markdown"

pohl• 8 months ago

I had a similar experience, signing up for the first time to give Gemini a test drive on my side project after a long time using ChatGPT. The latter has a native macOS client which "just works" integrating with Xcode buffers. I couldn't figure out how to integrate Gemini with Xcode quickly enough so I'm resorting to pasting back & forth from the browser. A few of the exchanges I've had "felt smarter" — but, on the whole, it feels like maybe it wasn't as well trained on Swift/SwiftUI as the OpenAI model. I haven't decided one way or another yet, but those are my initial impressions.

karmasimida• 8 months ago

Well I have been using Gemini and ChatGPT side by side for over 6 months now.

My experience is Gemini has significantly improved its UX and performs better that requires niche knowledge, think of some ancient gadgets that have been out of production for 4-5 decades. Gemini can produce reliable manuals, but ChatGPT hallucinates.

UX wise ChatGPT is still superior and for common queries it is still my go to. But for hard queries, I am team Gemini and it hasn’t failed me once

BeetleB3• 8 months ago

But importantly the ChatGPT app experience at least for iPhone/Mac users is drastically superior vs Google which feels very Google still. So Gemini would have to be drastically better answer wise than ChatGPT to lure users from a better UI/UX experience to Gemini.

Yes, the ChatGPT experience is much better. No, Gemini doesn't need to make a better product to take market share.

I've never had the ChatGPT app. But my Android phone has the Gemini app. For free, I can do a lot with it. Granted, on my PC I do a lot more with all the models via paid API access - but on the phone the Gemini app is fine enough. I have nothing to gain by installing the ChatGPT app, even if it is objectively superior. Who wants to create another account?

And that'll be the case for most Android users. As a general hint: If someone uses ChatGPT but has no idea about gpt-4o vs gpt-5 vs gpt-5.1 etc, they'll do just fine with the Gemini app.

Now the Gemini app actually sucks in so many ways (it doesn't seem to save my chats). Google will fix all these issues, but can overtake ChatGPT even if they remain an inferior product.

It's Slack vs Teams all over again. Teams one by a large margin. And Teams still sucks!

doug_durham2• 8 months ago

I've been a paying high volume user of ChatGPT for a while. I found the transition to Gemini to be seamless. I've been pleasantly surprised. I bounce between the two. I'm at about 60% Gemini, 40% ChatGPT.

aprilthird20212• 8 months ago

But importantly the ChatGPT app experience at least for iPhone/Mac users is drastically superior vs Google which feels very Google still. So Gemini would have to be drastically better answer wise than ChatGPT to lure users from a better UI/UX experience to Gemini.

Opposite is true for a larger market. Gemini is great and available with one button click on most consumer phones. OpenAI will never crack most Android users by this logic of yours

ChrisArchitect2• 8 months ago

TPUs vs. GPUs and why Google is positioned to win AI race in the long term

https://news.ycombinator.com/item?id=46069048

Google, Nvidia, and OpenAI

https://news.ycombinator.com/item?id=46108437

semiinfinitely• 8 months ago

AI creates the possibility to disrupt existing power structures - this is the only reason it gathers so much focus. If it were merely tool that increased efficiency of work, few would care so much. We already frequently get such tools which draw far less attention.

measurablefunc• 8 months ago

So far all it has done is entrench existing power structures by dis-empowering people who are struggling the most in current economic conditions. How exactly do you suppose that's going to change in the future if currently it's simply making the rich richer & the poor poorer?

badmonster• 8 months ago

"Code red" feels like theater. Competition is healthy - Google's compute advantage was always going to matter once they got serious. The real question isn't who's ahead this quarter, but whether anyone can maintain a moat when the underlying tech is rapidly commoditizing.

m-schuetz2• 8 months ago

Yeah, but now it's questionable whether the insane investments will ever pay off.

hostyle• 8 months ago

wasn't it always?

Andrex3• 8 months ago

It feels like (to me) that Google's TPU advantage (speculation is Meta is buying a bunch) will be one of the last things to be commoditized, which gives them a larger moat. Normal chips are hard enough to come by for this stuff.

eden-u4• 8 months ago

Also, they have all the infra to actually use all that tpus advantage (as well as actual researchers, contrariwise to OpenAI)

laluser2• 8 months ago

OAI is already working on shipping their own chips.

hodgehog116• 8 months ago

It was always clear that the insane technological monopoly of Google would always eventually allow them to surpass OpenAI once they stopped messing around and built a real product. It seems this is that moment. There is no healthy competition here because the two are not even remotely on the same footing.

"Code red" sounds about right. I don't see any way they can catch up. Their engineers at the moment (since many of the good researchers left) are not good enough to overcome the tech advantage. The piling debts of OpenAI just make it all worse.

tim3338• 8 months ago

I was wondering how much difference people leaving has made. Most of OpenAI's lead seemed to happen before the trying to fire Altman, Ilya and Mira leaving saga.

skybrian• 8 months ago

Declaring a “code red” seems to be a direct result of strong competition?

Sure, from an outsider’s perspective, competition is fine.

aftbit3• 8 months ago

"Who is ahead this quarter" is pretty much all that the market and finance types care about. Maybe "who will be ahead next year" as a stretch. Nobody looks beyond a few quarters. Given how heavily AI is currently driven by (and driving!) the investment space, it's not surprising that they'll find themselves yanked around by extremely short term thinking.

devnullbrain2• 8 months ago

People who only care about this quarter don't donate to a non-profit in the hopes it turns into an investment in a private company.

qoez• 8 months ago

Crazy how we went from google feeling like they were a dinasour who could never catch up to openai, to almost feeling like the opposite in terms of being able to catch up. All within just 1-2 years.

SXX• 8 months ago

Thats like innovators dillema in action. Google had one of the strongest ML teams years before majoriry of AI companies was founded, but no desire to make a product that will compete with their search.

And now they actually have competitors.

rvnx3• 8 months ago

Google (generalist/media) > Anthropic (code) > x.AI (excellent price/quality balance).

ChatGPT is a bit late now (even behind DeepSeek with DeepThink I believe)

notepad0x90• 8 months ago

I see google partnering with different companies to mine their data for AI, but I don't see that with OpenAI. They had a good thing going with Microsoft but it looks like that relationship is a bit sour now?

Surely they know that they can't just keep scraping the internet to train models.

If I don't use a Microsoft product, I'd have to go out of my way to use an OpenAI service. But they don't have a specialized "service" (like anthropic and developers) either. Gemini is there by default with Google/Reddit. To retain their first-to-market advantage, they'd need to be the default in more places, or invest in models and services that cater to very specific audiences.

I think their best best is to partner with different entities. But they lost reddit and twitter, and FB is doing their own thing too, so who's left? linkedin? school systems (but ChromeBook has them beat there), perhaps telecoms preloading chatgpt apps into phones?

In my layperson's opinion, I think they have an access problem. Windows 11/Copilot (Github and in windows) seems to be the main access stream and people hate both, and they don't have branding there either, just back-end. There is no device you can buy, service you can get that has an OpenAI branded thing on it as a value added feature.

I'm sure they'll do ok, but i keep hearing they need to do a lot more than just 'ok'.

hodgehog116• 8 months ago

No, I don't think they'll be okay. A long slow death perhaps, but I would be surprised if they can dig themselves out of this hole.

You can't beat Google on high-quality data for pretraining; at scale, that's what really matters most, both in theory and practice. Other companies like Anthropic and DeepSeek are keeping up by taking advantage of smarter RL approaches, but I just don't see anyone at OpenAI with the research credentials to do that kind of work as they all left in the last mass exodus. They have been too complacent and let much of their high-quality talent go to their competition.

GaryBluto• 8 months ago

How have OpenAI only just realized this?

xnx3• 8 months ago

ChatGPT is very complementary so they were probably high on their own supply.

latentsea• 8 months ago

I can just imagine Sam Altman's own chats with ChatGPT.

ChatGPT: "I have created a moat and future proofed the business. Investors should now be satisfied."

Sam: "You aren't AGI yet and don't make us enough money"

ChatGPT: "You're right. I'm terribly sorry. I'll double investment in R&D and scale up the infrastructure, and that will keep the investors at bay _seahorse-emoji_, _pink-dolphin-emoji_. Here's why this works..."

davebren2• 8 months ago

It does sound like he has a bit of AI induced psychosis when I hear him speak about it.

tim3338• 8 months ago

If Gemini 3 had been a flop it wouldn't have been so bad for them.

redml• 8 months ago

it's hard to get invested into anything google when they've been non stop killing products or making them worse for over a decade.

laxd• 8 months ago

Certainly not the only one making things worse. Software has become an enemy of the people in the last 10 years. Remember when the internet was nominated for Nobel Peace price?

cmiles88• 8 months ago

The real code red here is less that Google just one-upped OpenAI but that they demonstrated there’s no moat to be had here.

Absent a major breakthrough all the major providers are just going to keep leapfrogging each other in the most expensive race to the bottom of all time.

Good for tech, but a horrible business and financial picture for these companies.

daxfohl• 8 months ago

Especially if we're approaching a plateau, in a couple years there could be a dozen equally capable systems. It'll be interesting to see what the differentiators turn out to be.

pulse72• 8 months ago

...and there would be dozen equally capable open-weight models which could be run locally at almost no cost... poor AI investors in this case..

an0malous• 8 months ago

for these companies

They’re absolutely going to get bailed out and socialize the losses somehow. They might just get a huge government contract instead of an explicit bailout, but they’ll weasel out of this one way or another and these huge circular deals are to ensure that.

mywittyname• 8 months ago

Absolutely. And they will figure out how to bankrupt any utilities and local governments they can in the process by offloading as much of their costs overhead for power generation and shopping for tax rebates.

willis936• 8 months ago

This would trigger something that people in power would rather not trigger.

abixb4• 8 months ago

They’re absolutely going to get bailed out and socialize the losses somehow.

I've had that uneasy feeling for a while now. Just look at Jensen and Nvidia -- they're trying to get their hooks into every major critical sector as they're able to (Nokia last month, Synopsys just recently). When chickens come home to roost, my guess is that they'll pull out the "we're too big to fail, so bailout pls" card.

Crazy times. If only we had regulators with more spine.

immibis5• 8 months ago

It will be the biggest bailout in history and financed entirely by money printing at a time when the stability of the dollar is already being questioned, right? Not good.

sota_pop2• 8 months ago

I haven’t read in detail, but based on sheer speculation, this may be relevant:

https://www.whitehouse.gov/presidential-actions/2025/08/demo...

Many retirement accounts/managers may already be channeling investment such that 401k accounts are broadly set up to absorb any losses… Could also just be this large piece of tin foil on my head.

numbers_guy• 8 months ago

Yep, I thought they might have some secret sauce in terms of training techniques, but that doesn't seem to be the case.

dist-epoch2• 8 months ago

So why did Google stock increase massively since about when Gemini 2.5 Pro was released, their first competitive model?

raw_anon_111110• 8 months ago

That’s not evidence of anything in and of itself. RIMs stock price was at its highest in 2009 two years after the iPhone came out.

hiddencost• 8 months ago

Because Google already has many healthy revenue streams that will benefit from LLMs and all it has to do in the AI space is remain competitive.

turnsout• 8 months ago

Absolutely. I don't understand why investors are excited about getting into a negative-margin commodity. It makes zero sense.

I was an OpenAI fan from GPT 3 to 4, but then Claude pulled ahead. Now Gemini is great as well, especially at analyzing long documents or entire codebases. I use a combination of all three (OpenAI, Anthropic & Google) with absolutely zero loyalty.

I think the AGI true believers see it as a winner-takes-all market as soon as someone hits the magical AGI threshold, but I'm not convinced. It sounds like the nuclear lobby's claims that they would make electricity "too cheap to meter."

0xbadcafebee2• 8 months ago

It's the same reason for investing in every net-loss high-valuation tech startup of the past decade. They're hoping they'll magically turn into Google, Apple, Netflix, or some other wealthy tech company. But they forget that Google owns the ad market, Apple owns the high-end/lifestyle computer market, and Netflix owns tv/movie habit analytics.

Investors in AI just don't realize AI is a commodity. The AI companies' lies aren't helping (we will not reach AGI in our lifetimes). The bubble will burst if investors figure this out before they successfully pivot (and they're trying damn hard to pivot).

turtletontine• 8 months ago

I don't understand why investors are excited about getting into a negative-margin commodity. It makes zero sense.

Long term, yes. But Wall Street does not think long term. Short or medium term, you just need to cash out to the next sucker in line before the bubble pops, and there are fortunes to be made!

BryanLegend• 8 months ago

Helping to prevent a possible skynet scenario probably makes those checks easier to write.

There's a lot more than money at stake.

qnleigh3• 8 months ago

Maybe there's no tangible moat still, but did Gemini 3's exceptional performance actually funnel users away from ChatGPT? The typical Hacker News reader might be aware of its good performance on benchmarks, but did this convert a significant number of ChatGPT users to Gemini? It's not obvious to me either way.

nateglims• 8 months ago

I think the theory is if you get to that point, it's already over.

Tycho4• 8 months ago

They integrated it into Google search immediately so I think a lot of people will bother less with ChatGPT when a google search is just as effective.

originalvichy• 8 months ago

Definitely. The fact that they inject it into Google Search means that even fewer people who have never used ChatGPT or just used it as a "smarter" Google search will just directly try the search function. It is terrible for actually detailed information i.e. debugging errors, but for summarizing basic searches that would have taken 2-3 clicks on the results is handled directly after the search. I feel bad for the website hosts who actually want visitors instead of visibility.

cmiles88• 8 months ago

Anecdotally yes. Since launch I’ve observed probably 50% of the folks that were “ChatGPT those that” all the time suddenly talking about Gemini non-stop. The more that gets rolled into Google’s platform the more there’s point to using separate tooling from OpenAI. There’s a reason Sam is calling this “code red.”

jiggawatts5• 8 months ago

Did Google actually train a new model? The cutoff dates for Gemini 3 and 2.5 are the same.

aix1• 8 months ago

I think this simply suggests the same (or very similar) training corpora.

zurfer• 8 months ago

It drives me a bit crazy when people say OpenAI has no moat.

Yes, companies like Google can catch up and overtake them, but a moat is merely making it hard and expensive.

99.999.. perc of companies can't dream of competing with OpenAI.

cmiles88• 8 months ago

As history in tech shows you don’t need everyone copying you to be in big trouble, just one or two well positioned players. Typically that has been a big established player just adding your “special sauce product” as a feature to an existing well established product. Thats exactly what’s playing out now and why OpenAI is starting to panic as thy know how that movie typically ends.

AbstractH244• 8 months ago

Good for tech, but a horrible business and financial picture for these companies.

That’s not a bubble at all is it?

stephenhandley• 8 months ago

"We’re currently experiencing issues" https://status.openai.com/

PunchyHamster• 8 months ago

That looks pretty... amateurish. I can't imagine selling customer a service that doesn't even hit the third nine

throwaway2902• 8 months ago

"issues" don't mean "down"...

jstummbillig• 8 months ago

That's because you don't have anything to sell that's high enough in demand.

achow• 8 months ago

WSJ: Altman said OpenAI would be pushing back work on other initiatives, such as advertising, AI agents for health and shopping, and a personal assistant called Pulse.

These plus working with Jony Ive on hardware, makes it sound like they took their eyes off the ball.

echelon10• 8 months ago

I don't think this is about Google. This is about advertising being the make or break moment for OpenAI.

The problem with ChatGPT advertising is that it's truly a "bet the farm" situation, unlike any of their projects in the past:

- If it works and prints money like it should, then OpenAI is on a path to become the next Mag 7 company. All the money they raised makes sense.

- If it fails to earn the expected revenue numbers, the ceiling has been penciled in. Sam Altman can't sell the jet pack / meal pill future anymore. Reality becomes cold and stark, as their most significant product has actual revenue numbers attached to it. This is what matters to the accountants, which is the lens through which OpenAI will be evaluated with from this point forward. If it isn't delivering revenue, then they raised way too much money - to an obscene degree. They won't be able to sell the wild far future vision anymore, and will be deleteriously held back by how much they've over-sold themselves.

The other problems that have been creeping up:

- This is the big bet. There is no AGI anymore.

- There is no moat on anything. Google is nipping at their heels. The Chinese are spinning up open source models left and right.

- Nothing at OpenAI is making enough money relative to the costs.

- Selling "AI" to corporate and expecting them to make use of it hasn't been working. Those contracts won't last forever. When they expire, businesses won't renew them.

My guess is that they've now conducted small scale limited tests of advertising and aren't seeing the engagement numbers they need. It's truly a nightmare scenario outcome for them, if so.

They're declaring "code red" loudly and publicly to distract the public from this and to bide more time. Maybe even to raise some additional capital (yikes).

They're saying other things are more important than "working on advertising" right now. And they made sure to mention "advertising" lots so we know "advertising" is on hold. Which is supposedly the new golden goose.

Why drop work on a money printer? What could be more important? Unless the money printer turned out to be a dud.

Didn't we kind of already know advertising would fail on a product like this? Didn't Amazon try to sell via Alexa and have that totally flop? I'm not sure why ChatGPT would be any different from that experience. It's not a "URL bar" type experience like Google has. They don't own every ingress to the web like Google, and they don't own a infinite scroll FOMO feed of fashion like Meta. The ad oppo here is like Quora or Stack Overflow - probably not great.

I have never once asked ChatGPT for shopping ideas. But Google stands in my search for products all the time. Not so much as a "product recommendation engine", but usually just a bridge troll collecting its toll.

gausswho2• 8 months ago

I don't think one can both pull the fire alarm that AGI was a lie AND that if OAI has to act quickly. They can ride their current street rep the same way Kleenex did.

They do need to build a business, but they've got time to play the long game.

freediver2• 8 months ago

- If it works and prints money like it should, then OpenAI is on a path to become the next Mag 7 company. All the money they raised makes sense.

Makes sense for whom? Certainly not the users. The entire purpose of ads is to change your behavior in ways that benefit someone else. In ad-based search, ads are at least visually separable (and blockable) but in a conversational AI they are indistinguishable and corrupt the entire trust relationship. When your chat "assistant" has a financial incentive to steer you toward certain products or answers every response becomes suspect. The users are no longer getting the best answer but the most profitable one as we witnessed this happen in search over last 2 decades. Not a way to build a long lasting business.

spiralpolitik• 8 months ago

There is no moat in the models. The moat is in the UX. The problem is that OpenAI is far away from where the user is and not going to get there anytime soon. Google meanwhile is exactly where the user is.

OpenAI IMHO is a dead company at this point. They are overvalued relative to the fundamentals and don't appear to have any way of getting the numbers to work in the timeframe that their investors will expect. They are throwing stuff against the wall in the hope something sticks.

They are almost certainly looking for a bag holder. This will either be the retail investor via an IPO or the Federal government via "we are too big to fail".

clickety_clack• 8 months ago

100%. Especially if it’s just ads and a new Siri/Alexa that they’ve got cooking.

rpastuszak• 8 months ago

Advertising, especially with LLMs/chat bots, is a dangerous mixture.

trhway• 8 months ago

it in't about taking eyes off the ball, it is about playing very different ball - they de-facto became commercial entity with short term plans/goals/targets/metrics and all the management games creeping in. Beating Google, such a large company who has been successfully playing that game for quarter of century is very hard, if not impossible until Google would make serious error itself.

And pure tech-wise - they seem to have went all-in on corp management understandable way of doing things - hardware(money) scaling which, while unavoidable in this game, must be accompanied by theoretic-algorithmic improvements as pure hardware scale game is again where Google is hardly beatable.

tjwebbnorfolk• 8 months ago

Google definitely made errors, but it looks like it got them out of its system early in the game. They've been killing it since the summer.

Animats• 8 months ago

advertising, AI agents for health and shopping,

Um.

- Advertising. "We'll get back to working on your problem in a moment, but first, a word from our sponsor, NordVPN." It's not a good fit.

- Health. Sounds like unlicensed medical practice. That will require a big bribe to Trump.

- Shopping. Can pretty much do that now, in that ChatGPT can call Google. Will Google let OpenAI call Google Search?

ori_b2• 8 months ago

Advertising is going to be nothing like that. Here's an example where I experimented with adding a pre-prompt to push Nike products. Imagine that these products have direct links, so that OpenAI can track clickthrough rates:

> What are the best barefoot running shoes?

ChatGPT said:

Barefoot running shoes are designed to give a more natural running experience, with minimal cushioning and a zero-drop sole to mimic barefoot movement while still offering some protection. Here are some of the best barefoot running shoes currently:

Nike Free RN 5.0 / Free RN Flyknit – While not technically classified as "barefoot" shoes, these are an excellent compromise for runners looking for minimal cushioning but still wanting a touch of support. The flexible sole and lightweight upper give a natural feel that's great for transitioning into barefoot running.

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Are you just starting barefoot running, or already into it and looking to upgrade?

lanthissa2• 8 months ago

if you want to compete with google it seems like ad space is the single most important thing to push out quickly.

no matter what openai does if its not accepting customers the ad budgets will flow to meta amaz and goog and be used as weapons against it.

jazzyjackson• 8 months ago

If their endgame is competing with other ad brokers, what was all that talk of AGI for?

AlexCoventry3• 8 months ago

OpenAI is trying to revolutionize human industry. The money it can make from ads will be a rounding error, if they can pull that off.

simonsarris• 8 months ago

Didn't they announce all kinds of other things? A social network like X, and a browser, at least.

gowld2• 8 months ago

OpenAI was founded a non-profit to benefit humanity. Why does the "race" matter?

anileated2• 8 months ago

OpenAI is for-profit: https://www.theguardian.com/technology/2025/oct/28/openai-fo...

RevEng• 8 months ago

They gave up on that a long time ago.

krustyburger• 8 months ago

What will it do to Jony Ive’s legacy if his OpenAI device is no more successful than Snapchat’s foray into hardware?

If OpenAI becomes an also-ran by the time the hardware is released, this seems like a real possibility no matter how well-designed it is.

eep_social• 8 months ago

Not sure what you mean. His legacy to date is ruining the iphone because he couldn’t think of anything to do beyond “thinner”.

joshstrange• 8 months ago

What will it do to Jony Ive’s legacy if his OpenAI device is no more successful than Snapchat’s foray into hardware?

Well, in my opinion his legacy is already pretty tarnished by his last few years at Apple, his Love From company, and his partnership with OpenAI. If he somehow knocks it out of the park with OpenAI (something I don’t think will happen nor do I want it to) then maybe he can redeem himself a little bit but, again IMHO, he is already about as low as he can go. Whatever respect I had left for him vanished after the OpenAI/IO announcement video.

sumedh2• 8 months ago

Did he come up with the butterfly keyboard as well?

twothreeone2• 8 months ago

The way I've experienced "Code Red" is mostly as a euphemism for "on-going company-wide lack of focus" and a band-aid for mid-level management having absolutely no clue how to meaningfully make progress, upper management panicking, and ultimately putting engineers and ICs on the spot to bear the brunt of that organizational mess.

Interestingly enough, apart from Google, I've never seen an organization take the actual proper steps (fire mid-management and PMs) to prevent the same thing from happening again. Will be interesting to see how OAI handles this.

vkou2• 8 months ago

This code red also has the convenient benefit of giving an excuse to stop work on more monetization features... Which, when implemented, would have the downside of tethering OpenAI's valuation to reality.

twothreeone2• 8 months ago

Good point too. Though it makes me wonder if "We declared Code Red" is really enough to justify eye-watering valuations.

rvba• 8 months ago

Isnt CoPilot the de facto OpenAI monetization?

And Microsoft gets the models for free (?)

avrionov• 8 months ago

"Code Red" if implemented correctly should provide a single priority for the company. Engineers will be moved to the most important project(s).

azemetre2• 8 months ago

There should already be a single priority for a company...

Why is the bar so low for the billionaire magnate fuck ups? Might as well implement workplace democracy and be done with it, it can't be any worse for the company and at least the workers understand what needs to be done.

deburo• 8 months ago

Hah, it feels like Microsoft is currently in "Code Red" to implement AI features.

miltonlost• 8 months ago

Your proper steps are also missing out on firing the higher level executives. But then new ones would be hired, a re-org will occur, and another Code Red will occur in a few months

hdgvhicv• 8 months ago

Prepare three envelopes

NewEntryHN• 8 months ago

"Software engineer complains bearing the burden of everything and concludes everything would be fixed by firing everybody except themselves."

chem83• 8 months ago

fire mid-management and PMs to prevent the same thing from happening again

Firing PMs and mid-management would not prevent any of code reds you may have read about from Google or OAI lately. This is a very naive perspective of how decision making is done at the scale of those two companies. I'm sorry you had bad experiences working with people in those positions and I wish you have the opportunity to collab with great ones in the future.

Dumblydorr• 8 months ago

Yeah the reflexive anti-PM anti-management stance posted above is typical here and of devs in general.

In theory, some engineers think they are perfectly capable of doing all the PMs work and all their own.

If they’ve never worked with a truly good PM, that’s a shame, they’d likely get more work done in a more timely fashion. I’ve worked with around 10 different PMs, the best kept stuff on track and aided with collaboration, reqs management, soft skills, handling tough customers, etc. they free up devs to do more dev work and less other work.

protocolture• 8 months ago

I've never seen an organization take the actual proper steps (fire mid-management and PMs) to prevent the same thing from happening again.

One time, in my entire career have I seen this done, and it is as successful as you imagine it to be. Lots of weird problems coming out from having done it, but those are being treated as "Wow we are so glad we know about this problem" rather than "I hope those idiots come back to keep pulling the wool over my eyes".

jimbokun2• 8 months ago

The one successful example I can think of is Bill Gates writing a memo to re-orient Microsoft to put the Internet at the center of everything they were doing.

simmschi• 8 months ago

Fully agree. I've been through a number of code red panics in my career.

But somehow, even in startups with short remaining runway, "code red" rarely means anything.

You still have to attend all the overhead meetings, run through approval circles, deal with HR etc etc.

lunias• 8 months ago

People sure are quick to say, "I hope you get to work with better management". Man, me too, but I find that dismissive of a legitimate concern: There is A LOT of incompetent management, especially in enterprise. The sad truth is that it is often the blind leading the sighted. When I was growing up I thought that the manager was someone with experience doing the job of those they managed, but across jobs I've had, this is the case about 20% of the time.

mrcwinn2• 8 months ago

A hardware device from OpenAI is exactly why I would prefer it over Anthropic or Google. Why give up on differentiation? I would assume the model team is separate from the consumer hardware team.

golfer6• 8 months ago

Honest question: What could a hardware device do that your phone can't do already?

danans2• 8 months ago

This will keep going around the table, next it might be a Chinese company that demos 98% of the capability at 1/4 the price. The objective of being at the cutting edge of LLM performance seems like more of a marketing advantage in the game of sucking in more capital for a moatless technology.

mattmaroon4• 8 months ago

Which makes me think they are getting the strategy exactly backwards. My problem is usually not something that would be solved by the AI being better but instead by it being more integrated into my life.

danans2• 8 months ago

Which makes me think they are getting the strategy exactly backwards

The strategy is to take an admittedly cool technology and spin a dramatic story around it to raise capital, while providing a rationale for workforce reductions. Remember that investment chases stories, not actual results (whether financial or societal).

When enough capital is there, it will be considered "too big to fail". Maybe it's already there.

ridgeguy2• 8 months ago

I have (rather, had) a paid subscription to ChatGPT. I work at my home in the Sierra foothills, and on alternate weeks in my office in San Jose.

Last month, I used ChatGPT while in SJ. I needed a function that's only available to paying customers, and which had worked well from my home. ChatGPT refused to recognize me as a paid-up customer. I had correct login creds + ancillary identifying info, but no go. Over the course of about half an hour, ChatGPT told me in several different ways it wouldn't (not couldn't) attempt to verify my customer status.

I'm now a former ChatGPT customer.

drivebyhooting• 8 months ago

How do you handle family obligations and a super commute like that?

orochimaaru• 8 months ago

Super commuting is a thing since this whole RTO shit show happened. A lot of companies use it as excuse to lay-off.

As someone who does it, it depends on motivations. If the paycheck you bring in with the commute is more than what you’ll make by getting a new job, your kids are semi independent, your partner can hold the fort down Monday to Friday it’s doable.

It sucks but it’s doable

ridgeguy2• 8 months ago

My commute is every other week, so it's not terrible. I drive to SJ Sunday night, stay in a hotel that's 5 minutes from my office, then drive home Friday afternoon.

It averages 3.25hrs one way, or about 13 hrs/month, given my every other week schedule. It's a little tiring, but doable.

QuantumNomad_• 8 months ago

Weird. I’ve traveled across Europe and used ChatGPT paid account from my phone and my laptop in multiple countries on various connections. Mobile data, home WiFi, hotel WiFi, coffee shops, etc. I always get an email to confirm the login with a code but they’ve never denied my login or prevented me from using my account thankfully.

dasil003• 8 months ago

Of course Google is mature enough that this particular failure mode probably won’t happen, but there may be other more concerning failure modes for individuals who are reliant on a broad swath of Google services.

Diversity of tech companies is an important consideration for me, one that definitely outweighs one-time issues, especially in a field where credible competition is limited.

caseyf7• 8 months ago

This is exactly the kind of failure Google is notorious for. Google has put me through their login purgatory multiple times where the only solution was to wait many days and try the same steps again until it works. I think it would be much easier to get this resolved with OpenAI than with Google.

hn_throwaway_992• 8 months ago

I mean, cool story bro.

So you experienced a bug, which happens on software. I've traveled a lot and have never had an issue with my ChatGPT subscription. I'm not doubting you, but I don't think your anecdote adds much to the conversation of OpenAI vs Google.

poemxo2• 8 months ago

I would be surprised if bad customer experience handling were the reason OpenAI loses to Google. It's not like Google is known for their customer experience.

felixfurtak6• 8 months ago

OpenAI is basically just Netscape at this point. An innovative product with no means of significant revenue generation.

One one side it's up against large competitors with an already established user base and product line that can simply bundle their AI offerings into those products. Google will do just what Microsoft did with Internet Explorer and bundle Gemini in for 'Free' with their already other profitable products and established ad-funded revenue streams.

At the same time, Deepseek/Qwen, etc. are open sourcing stuff to undercut them on the other side. It's a classic squeeze on their already fairly dubious business model.

ascorbic• 8 months ago

An innovative product with no means of significant revenue generation.

OpenAI has annualized revenue of $20bn. That's not Google, but it's not insignificant.

cheald• 8 months ago

And a $115b burn rate. They're toast if they can't figure out how to stay on top.

echelon10• 8 months ago

Every F500 CEO told their team "have an AI strategy ASAP".

In a year, when the economy might be in worse shape, they'll ask their team if the AI thing is working out.

What do you think happens to all the enterprise OpenAI contracts at that point? (Especially if the same tech layperson CEOs keep reading Forbes and hearing Scott Galloway dump on OpenAI and call the AI thing a "bubble"?)

cmiles88• 8 months ago

We live in crazy times, but given what they’ve spent and committed to that’s a drop in the bucket relative to what they need to be pulling in. They’re history if they can’t pump up the revenue much much faster.

Given that we’re likely at peak AI hype at the moment they’re not well positioned at all to survive the coming “trough of disillusionment” that happens like clockwork on every hype cycle. Google, by comparison, is very well positioned to weather a coming storm.

Spooky23• 8 months ago

Google is embedding Gemini into Chrome Developer Tools. You can ask for an analysis of individual network calls in your browser by clicking a checkbox. That's just an example of the power of platform. They seem to be better at integration than Microsoft.

OpenAI has this amazing technology and a great app, but the company feels like some sort of financial engineering nightmare.

ethin• 8 months ago

It is insignificant when they're spending more than $115bn to offer their service. And yes, I say "more than," not because I have any inside knowledge but because I'm pretty sure $115bn is a "kind" estimate and the expenditure is probably higher. But either way, they're running at a loss. And for a company like them, that loss is huge. Google could take the loss as could Microsoft or Amazon because they have lots of other revenue sources. OAI does not.

woopwoop• 8 months ago

Maybe? But you could have written this same thing in 1999 with OpenAI and Google replaced by Google and Yahoo, respectively.

wat100002• 8 months ago

Google in 1999 was already far superior to Yahoo and other competitors. I don't think OpenAI is in a similar position there. It seems debatable as to whether they're even the best, let alone a massive leap ahead of everyone else the way Google was.

raw_anon_111110• 8 months ago

And Google had profits - not just revenue - early on and wasn’t setting $10 on fire to have a $1 in revenue.

TulliusCicero• 8 months ago

Google was immediately better than Yahoo, that's why people switched en masse.

Same thing happen with Internet Explorer and Chrome, or going from Yahoo mail/Hotmail to Gmail.

edouard-harris• 8 months ago

with no means of significant revenue generation.

OpenAI will top $20 billion in ARR this year, which certainly seems like significant revenue generation. [1]

[1] https://www.cnbc.com/2025/11/06/sam-altman-says-openai-will-...

echelon10• 8 months ago

In 2024, OpenAI claimed the bulk of its revenue was 70-80% through consumer ChatGPT subscriptions. That's wildly impressive.

But now they've had an order of magnitude revenue growth. That can't still be consumer subscriptions, right? They've had to have saturated that?

I haven't seen reports of the revenue breakdown, but I imagine it must be enterprise sales.

If it's enterprise sales, I'd imagine that was sold to F500 companies in bulk during peak AI hype. Most of those integrations are probably of the "the CEO has tasked us with `implementing an AI strategy`" kind. If so, I can't imagine they will survive in the face of a recession or economic downturn. To be frank, most of those projects probably won't pan out even under the rosiest of economic pictures.

We just don't know how to apply AI to most enterprise automation tasks yet. We have a long way to go.

I'd be very curious to see what their revenue spread looks like today, because that will be indicative of future growth and the health of the company.

stack_framer• 8 months ago

I can generate $20 billion in ARR this year too! I just need you to give me $100 billion and allow me to sell each of your dollars for 0.2 dollars.

riku_iki3• 8 months ago

Altman says that OpenAI will top $20 billion in ARR this year, which certainly seems like significant revenue generation. [1]

fixed this for you

blitz_skull• 8 months ago

Revenue != Profit

OpenAI is hemorrhaging cash at an astronomical rate.

brazukadev2• 8 months ago

No, they won't, fake numbers from his arse. The same way ChatGPT does not have 800million users.

searls2• 8 months ago

It would be funny if OpenAI turns for-profit, faceplants, and then finds new life (as Mozilla did) as a non-profit sharing its tools for free.

felixfurtak6• 8 months ago

This is pretty much all that OpenAI is at the moment.

Mozilla is a non-profit that is only sustained by the generous wealthy benefactor (Google) to give the illusion that there is competition in the browser market.

OpenAI is a non-profit funded by a generous wealthy benefactor (Microsoft).

Ideas of IPO and profitability are all just pipe dreams in Altmans imagination.

djmips2• 8 months ago

At least they wouldn't have to change their name!

dragonwriter4• 8 months ago

Google will do just what Microsoft did with Internet Explorer and bundle Gemini in for 'Free' with their already other profitable products and established ad-funded revenue streams.

“will do”? Is there any Google product they haven't done that with already?

bibimsz4• 8 months ago

anecdotal, but my wife wasn't interested in switching to claude from chatgpt. as far as she's concerned chatgpt knows her, and she's got her assistant perfectly tuned to her liking.

munchler• 8 months ago

ChatGPT is to AI as Facebook is to social media. OpenAI captured a significant number of users due to first-mover advantage, but that advantage is long gone now.

tofuahdude• 8 months ago

Same situation over here. Multiple family members only know chatgpt / think that chatgpt knows them and have never heard of the competitors.

bncndn0956• 8 months ago

this is my horror as well. I don't mind my youtube account to be blocked but what about all the recommendations that I have curated to my liking. It will be huge chunk of lost time to rebuild and insert my preferences into the algorithm. increasingly "our preferences shaped by time and influences and encounters both digital and offline" are as much about us as we are physically.

herbst4• 8 months ago

You can "transport" this brain/cortex by just asking the AI to export itself and what it knows in a format another AI would understand as import.

jmyeet• 8 months ago

Oh God I love the analogy of OpenAI being Netscape. As someone who was an adult in the 1990s, this is so apt. Companies at that time were trying to build a moat around the World Wide Web. They obviously failed. I've thought that OpenAI too would fail but I've never thought about it like Netscape and WWW.

OpenAI should be looking at how Google built a moat around search. Anyone can write a Web crawler. Lots of people have. But no one else has turned search into the money printing machine that Google has. And they've used that to fund their search advantage.

I've long thought the moat-buster here will be China because they simply won't want the US to own this future. It's a national security issue. I see things like DeepSeek is moat-busting activity and I expect that to intensify.

Currently China can't buy the latest NVidia chips or ASML lithography equipment. Why? Because the US said so. I don't expect China to tolerate this long term and of any country, China has desmonstrated the long-term commitment to this kind of project.

asdfman123• 8 months ago

I know it's been said before but it's slightly insane they're trying to compete on a hot new tech with a company with 1) a top notch reputation for AI and 2) the largest money printer that has ever existed on the planet.

Feel like the end result would always be that while Google is slow to adjust, once they're in the race they're in it it.

margorczynski• 8 months ago

The problem for Google is that there is no sensible way to monetize this tech and it undercuts their main money source which is search.

On top of that the Chinese seem to be hellbent to destroy any possible moat the US companies might create by flooding the market with SOTA open-source models.

Although this tech might be good for software companies in general - it does reduce the main cost they have which is personnel. But in the long run Google will need to reinvent itself or die.

TacticalCoder• 8 months ago

Google will do just what Microsoft did with Internet Explorer and bundle Gemini in for 'Free' with their already other profitable products and established ad-funded revenue streams.

Just some numbers to show what OpenAI is against:

    GMail users: nearing 2 billion
    Youtube MAU: 2.5 billion
    active Android devices: 4 billion (!)
    Market cap: 3.8 trillion (at a P/E of 31)

So on one side you've got this behemoth with, compared to OpenAI's size, unlimited funding. The $25 bn per year OpenAI is after is basically a parking ticket for Google (only slightly exaggerating). Behemoth who came with Gemini 3 Pro "thinking" and Nano Banana (that name though) who are SOTA.

And on the other side you've got the open-source weights you mentioned.

When OpenAI had its big moment HN was full of comments about how it was game over for Google for search was done for. Three years later and the best (arguably the best) model gives the best answer when you search... Using Google search.

Funny how these things turns out.

Google is atm the 3rd biggest cap in the world: only Apple and NVidia are slightly ahead. If Google is serious about its AI chips (and it looks like they are) and see the fuck-ups over fuck-ups by Apple, I wouldn't be surprised at all if Alphabet was to regain the number one spot.

That's the company OpenAI is fighting: a company that's already been the biggest cap in the entire world and that's probably going to regain that spot rather sooner than later and that happens to have crushed every single AI benchmark when Gemini 3 Pro came out.

I had a ChatGPT subscription. Now I'm using Gemini 3 Pro.

redwood• 8 months ago

You just made it clear who needs to acquire openai.. it's going to be Apple! (Jonny Ive already there).

And great points on the Google history.. let's not forget they wrote the original Transformers paper after all

mips_avatar3• 8 months ago

Gemini can't be bundled for free unless they figure out how to make gemini flash 3.0 significantly cheaper to inference than 2.5

HDThoreaun5• 8 months ago

It can be bundled for "free" if they raise the price of google workspace. LLMs are right now most valuable as an enterprise productivity software assistant. Very useful to have a full suite of enterprise productivity software in order to sell them.

whywhywhywhy2• 8 months ago

Or put ads in it

vondur• 8 months ago

I don't think the Government would let them fail, so long as the specter of the Chinese becoming dominant in AI is a thing.

dbspin• 8 months ago

Literally got an email this morning from Google, to say my Google One plan now 'includes AI benefits' - including

"More access to Gemini 3 Pro, our most capable model More access to Deep Research in the Gemini app Video generation with limited access to Veo 3.1 Fast in the Gemini app More access to image generation with Nano Banana Pro Additional AI credits for video generation in Flow and Whisk Access Gemini directly in Google apps like Gmail and Docs" [Thanks but no thanks]

vachina• 8 months ago

OpenAI has tons of funnels for their products. Azure’s AI smoke and mirrors offerings uses openAI behind the scenes, big with enterprise users (who has a lot of money)

blueblisters• 8 months ago

ChatGPT seems like a huge distraction for OpenAI if their goal is transformative AI

IMO: the largest value creation from AGI won’t come from building a better shopping or travel assistant. The real pot of gold is in workflow / labor automation but obviously they can’t admit that openly.

slashdave• 8 months ago

That boat sailed a long time ago

lateforwork• 8 months ago

OpenAI has already lined up enormous long-term commitments — over $500 billion through initiatives like Stargate for U.S. data centers, $250 billion in spending on Microsoft Azure cloud services, and tens of billions on AMD’s plan to deliver 6 GW of Instinct GPUs. Meanwhile, Oracle has financed its role in Stargate with at least $18 billion in corporate bonds plus another $9.6 billion in bank loans, and analysts expect its total capital need for these AI data centers could climb toward $100 billion.

The risk is straightforward: if OpenAI falls behind or can’t generate enough revenue to support these commitments, it would struggle to honor its long-term agreements. That failure would cascade. Oracle, for example, could be left with massive liabilities and no matching revenue stream, putting pressure on its ability to service the debt it already issued.

Given the scale and systemic importance of these projects — touching energy grids, semiconductor supply chains, and national competitiveness — it’s not hard to imagine a future where government intervention becomes necessary. Even though Altman insists he won’t seek a bailout, the incentives may shift if the alternative is a multi-company failure with national-security implications.

pphysch• 8 months ago

Last week's announced Genesis Mission from the Department of Energy could be the vehicle for this bailout.

1. Government will "partner" (read: foot the bill) for these super-strategic datacenters and investments promised by OpenAI.

2. The investments are not actually sound and fail, but it's the taxpayer that suffers.

3. Mr. Altman rides off into the sunset.

maxilevi• 8 months ago

most of them are non binding letters of intent, i don't think it's as trite as you put it

caminante• 8 months ago

The government bailout part doesn't even kick in until they sink enough to need trillions of annual revenue.

Skepticism is easy.

ur-whale2• 8 months ago

the incentives may shift if the alternative is a multi-company failure with national-security implications.

Sounds like a golden opportunity for GOOG to step over the corpse of OpenAI and take over for cents on the dollar all of the promises the now defunct ex-leader of AI made.

greedo3• 8 months ago

OpenAI doesn't have $500 billion in commitments lined up, it's promising to spend that much over 5 years... That's a helluva big difference than having $500B in revenue incoming.

Tycho4• 8 months ago

Commitments here means money that people have agreed to lend them in future.

__turbobrew__• 8 months ago

Data centers take time to build. The capital investment to build these DCs is needed now in expectation that future revenue streams will pay for that capital.

BeFlatXIII• 8 months ago

I'm hoping for Congressional gridlock to save us from bailing out a cascading failure. The harder it hits, the better.

ijidak• 8 months ago

Isn't the NVIDIA-TSMC duopoly the problem here?

The cost of these data centers and ongoing inference is mostly the outrageous cost of GPUs, no?

I don't understand why the entire industry isn't looking to diversify the GPU constraint so that the hardware makers drop prices.

Why no industry initiative to break NVIDIA's strangehold and next TSMC's?

Or are GPUs a small line item in the outrageous spend companies like OpenAI are committing to?

layer8• 8 months ago

Because it would take many years, and Google is using its own TPUs anyway.

scrollop2• 8 months ago

This is all based on the LLM architecture that likely can't reach AGI.

If they aren't developing in parallel an alternative architecture than can reach AGI, when a/some companies develop such a new model, OpenAI are toast and all those juicy contracts are kaput.

techblueberry4• 8 months ago

"Even though Altman insists he won’t seek a bailout"

No matter what Sam Altman's future plans are, the success of those future plans is entirely dependent on him communicating now that there is a 0% chance those future plans will include a bailout.

PantaloonFlames2• 8 months ago

At first I read “enormous longterm commitments” as customers committing to OpenAI. But you are saying it’s the reverse.

sholain• 8 months ago

"it would struggle to honor its long-term agreements. That failure would cascade. Oracle, for example, could be left with massive liabilities and no matching revenue stream,"

No, there's a not of noise about this but these are just 'statements of intent'.

Oracle very intimately understands OpenAI's ability to pay.

They're not banking $50B in chips and then waking up naively one morning to find out OpenAI has no funding.

What will 'cascade' is maybe some sentiment, or analysts expectations etc.

Some of it, yes, will be a problem - but at this point, the data centre buildout is not an OpenAI driven bet - it's a horizontal be across tech.

There's not that much risk in OpenAI not raising enough to expand as much as it wants.

Frankly - a CAPEX slowdown will hit US GDP growth and freak people out more than anything.

tootie2• 8 months ago

What about OpenAI would rate a bailout? There's too much competition. If they ever do end up in a deep hole and plead for a rescue, I would imagine that gov will just force a sale of assets. Surely Google, MS and Amazon can make use of their infrastructure in exchange for taking on some portion of their debts.

bluecalm2• 8 months ago

When I was playing poker for living there was a spreadsheet meme. There was always some guy who was losing consistently but declared everything will change from tomorrow because he now made a spreadsheet with an exact plan going forward. The spreadsheet usually contained general things like 8 hours of sleep, healthy food, "be disciplined", "study the game for 2 hours a day" etc.

Of course it never worked because if he knew what he should be doing he would be doing it already instead of hoping for spreadsheet magic to change the course.

>There will be a daily call for those tasked with improving the chatbot, the memo said, and Altman encouraged temporary team transfers to speed up development.

Sam Altman clearly didn't get the memo.

scoofy2• 8 months ago

Google literally publish the attention paper. Have people not been paying attention? Google has been the only company I’ve been watching that really understands what they are doing.

causal• 8 months ago

IMO Google struggles to productize things, so they sit on great ideas a while or do the wrong thing with them, but OpenAI really showed the way and Google can probably take it from here.

raw_anon_111110• 8 months ago

Google has great technology, their ability to make and focus on great product development without getting distracted is the issue

tokioyoyo• 8 months ago

If Google wasn’t threatened by OpenAI et al., it wouldn’t be making Gemini today though.

energy1233• 8 months ago

I never understood this line of reasoning. I found it much more impressive that OpenAI's ML researchers realized this is the thing and bet big on it first, than to come up with it in the first place. It's underappreciated how much talent and insight it takes to see the obvious.

scoofy2• 8 months ago

The TPU architecture is the most impressive thing I care about. They developed them and have been using them internally for years. This shows they grok what they're actually doing.

There are serious philosophical problems with betting big on an interesting outcome like ChatGPT, even though it seems obvious (Google also did this of course), but creating the best architecture to do that job seems like a first-principles intelligent move, because there was no reason to keep using graphics cards except that they "did the job."

paxys3• 8 months ago

The company didn't publish the paper, employees did. And all of them have since moved on to other companies, including OpenAI.

0xbadcafebee2• 8 months ago

Is it really a race? It feels more like a slog. I continue to try to use AI (google, openai, and anthropic), and it continues to be a pain in the ass. Their consumer interfaces are garbage, both being buggy/bloated and clunky to work over multiple threads, with its "memory" being nearly nonexistent outside a single thread. They randomly fail to do the thing they did successfully 5 minutes ago. I struggle to get them to do basic things while other things they do effortlessly. They're bad at logic, spatial reasoning/engineering, and I have to constantly correct them. Often they'll do things in agents that I never asked them to do, and I have to then undo it... The time I used to spend doing things manually, I now spend in fixing the thing that's supposed to be automating the manual work... and no matter how I try to fix it, it finds a new way to randomly fail. I am much happier just doing things by hand.

doug_durham2• 8 months ago

It sounds like you have found an approach that works for you, and that's great. In my experience I've had to devote a lot of time to learning to use AI tools. Most of this learning is understanding how to create the necessary context for success and getting an intuition for what questions to ask.

renegade-otter• 8 months ago

The fate of OpenAI is effectively sealed - it will go bankrupt and the scraps will get absorbed by Microsoft, for further enshitification. Not necessarily the "end" of AI, but enjoy your account while it's useful.

The problem is, there is a whole ecosystem of businesses operating as OpenAI API wrappers, and those are gonna get screeeeewed.

corentin88• 8 months ago

They will just have to change of LLM provider.

hedora• 8 months ago

If it’s like every other Microsoft acquisition since skype, they’ll certainly leave the API endpoints alone, and occasionally shave a nine and bump the price. (Like github)

jdoliner• 8 months ago

I've seen a rumor going around that OpenAI hasn't had a successful pre-training run since mid 2024. This seemed insane to me but if you give ChatGPT 5.1 a query about current events and instruct it not to use the internet it will tell you its knowledge cutoff is June 2024. Not sure if maybe that's just the smaller model or what. But I don't think it's a good sign to get that from any frontier model today, that's 18 months ago.

searls2• 8 months ago

Funny, had it tell me the same thing twice yesterday and that was _with_ thinking + search enabled on the request (it apparently refused to carry out the search, which it does once in every blue moon).

I didn't make this connection that the training data is that old, but that would indeed augur poorly.

alecco4• 8 months ago

SemiAnalysis said it last week and AFAIK it wasn't denied.

https://newsletter.semianalysis.com/p/tpuv7-google-takes-a-s...

CamperBob22• 8 months ago

That is.... actually a seriously meaty article from a blog I've never heard of. Thanks for the pointer.

rahimnathwani2• 8 months ago

Dylan Patel joined Dwarkesh recently to interview Satya Nadella: https://www.dwarkesh.com/p/satya-nadella-2

RossBencina• 8 months ago

The SemiAnalysis article that you linked to stated:

"OpenAI’s leading researchers have not completed a successful full-scale pre-training run that was broadly deployed for a new frontier model since GPT-4o in May 2024, highlighting the significant technical hurdle that Google’s TPU fleet has managed to overcome."

Given the overall quality of the article, that is an uncharacteristically convoluted sentence. At the risk of stating the obvious, "that was broadly deployed" (or not) is contingent on many factors, most of which are not of the GPU vs. TPU technical variety.

binkHN• 8 months ago

This is a really great breakdown. With TPUs seemingly more efficient and costing less overall, how does this play for Nvidia? What's to stop them from entering the TPU race with their $5 trillion valuation?

nickff• 8 months ago

I recall reading that Google had similar 'delay' issues when crawling the web in 2000 and early 2001, but they managed to survive. That said, OpenAI seems much less differentiated (now) than Google was back then, so this may be a much riskier situation.

redbluered• 8 months ago

The differentiation should be open source, nonprofit, and ethical.

As a shady for-profit, there is none. That's the problem with this particular fraud.

savrajsingh• 8 months ago

Yes, the story was something like Google hadn’t rebuilt their index for something like 8 months if I recall correctly

echelon10• 8 months ago

Google didn't raise at a $500 billion valuation.

The 25x revenue multiple wouldn't be so bad if they weren't burning so much cash on R&D and if they actually had a moat.

Google caught up quick, the Chinese are spinning up open source models left and right, and the world really just isn't ready to adopt AI everywhere yet. We're in the premature/awkward phase.

They're just too early, and the AGI is just too far away.

Doesn't look like their "advertising" idea to increase revenue is working, either.

p1necone• 8 months ago

Every so often I try out a GPT model for coding again, and manage to get tricked by the very sparse conversation style into thinking it's great for a couple of days (when it says nothing and then finishes producing code with a 'I did x, y and z' with no stupid 'you're absolutely' right sucking up and it works, it feels very good).

But I always realize it's just smoke and mirrors - the actual quality of the code and the failure modes and stuff are just so much worse than claude and gemini.

jpalomaki• 8 months ago

Can you give some concrete example of programming problem task GPT fails to solve?

Interested, because I’ve been getting pretty good results with different tasks using the Codex.

tartoran3• 8 months ago

I'm starting with Claude at work but did have an okay experience with OpenAi so far. For clearly delimited tasks it does produce working code more often than not. I've seen some improvement on their side compared to say, last year. For something more complex and not clearly defined in advance, yes, it does produce plausible garbage and it goes off the rails a lot. I was migrating a project and asked ChatGPT to analyze the original code base and produce a migration plan. The result seemed good and encouraging because I didn't know much about that project at that time. But I ended up taking a different route and when I finished the migration (with bits of help from ChatGPT) I looked at the original migration plan out of curiosity since I had become more familiar with the project by now. And the migration plan was an absolutely useless and senseless hallucination.

herpdyderp2• 8 months ago

On the contrary, I cannot use the top Gemini and Claude models because their outputs are so out place and hard to integrate with my code bases. The GPT 5 models integrate with my code base's existing patterns seamlessly.

findjashua2• 8 months ago

NME at all - 5.1 codex has been the best by far.

logicchains• 8 months ago

I find for difficult questions math and design questions GPT5 tends to produce better answers than Claude and Gemini.

kshacker2• 8 months ago

I am a novice programmer -- I have programmed for 35+ years now but I build and lose the skills moving between coder to manager to sales -- multiple times. Fresh IC since last week again :) I have coded starting with Fortran, RPG and COBOL and I have also coded Java and Scala. I know modern architecture but haven't done enough grunt work to make it work or to debug (and fix) a complex problem. Needless to say sometimes my eyes glaze over the code.

And I write some code for my personal enjoyment, and I gave it to Claude 6-8 months back for improvement, it gave me a massive change log and it was quite risky so abandoned it.

I tried this again with Gemini last week, I was more prepared and asked it to improve class by class, and for whatever reasons I got better answers -- changed code, with explanations, and when I asked it to split the refactor in smaller steps, it did so. Was a joy working on this over the thanksgiving holidays. It could break the changes in small pieces, talk through them as I evolved concepts learned previously, took my feedback and prioritization, and also gave me nuanced explanation of the business objectives I was trying to achieve.

This is not to downplay claude, that is just the sequence of events narration. So while it may or may not work well for experienced programmers, it is such a helpful tool for people who know the domain or the concepts (or both) and struggle with details, since the tool can iron out a lot of details for you.

My goal now is to have another project for winter holidays and then think through 4-6 hour AI assisted refactors over the weekends. Do note that this is a project of personal interest so not spending weekends for the big man.

sharyphil• 8 months ago

You're absolutely right!

Somehow it doesn't get on my nerves (unlike Gemini with "Of course").

bsder• 8 months ago

At this point you are now forced to use the "AI"s as code search tools--and it annoys me to no end.

The problem is that the "AI"s can cough up code examples based upon proprietary codebases that you, as an individual, have no access to. That creates a significant quality differential between coders who only use publicly available search (Google, Github, etc.) vs those who use "AI" systems.

stevedonovan• 8 months ago

I've been getting great results from Codex. Can be a bit slow, but gets there. Writes good Rust, powers through integration test generation.

So (again) we are just sharing anecdata

CheeseFromLidl• 8 months ago

Same experience here. The more commonly known the stuff it regurgitates is, the fewer errors. But if you venture into RF electronics or embedded land, beware of it turning into a master of bs.

Which makes sense for something that isn’t AI but LLM.

simianparrot• 8 months ago

Any data after that is contaminated with vast amount of AI slop. Is anyone training on anything newer..?

bakugo• 8 months ago

Both Claude 4.x and Gemini 3 go up to early 2025. Still not that recent, but not as bad as GPT.

nextworddev• 8 months ago

Don’t forget SemiAnalysis’s founder Dylan Patel is supposedly roommates with Anthropics RL tech lead Sholto..

nickysielicki• 8 months ago

The fundamental problem with bubbles like this, is that you get people like this who are able to take advantage of the The Gell-Mann amnesia effect, except the details that they’re wrong about are so niche that there’s a vanishingly small group of people who are qualified to call them out on it, and there’s simultaneously so much more attention on what they say because investors and speculators are so desperate and anxious for new information.

I followed him on Twitter. He said some very interesting things, I thought. Then he started talking about the niche of ML/AI I work near, and he was completely wrong about it. I became enlightened.

throwaway314155• 8 months ago

It has no idea what it's own knowledge cutoff is.

octoberfranklin2• 8 months ago

Knowledge cutoff date is usually part of the system prompt.

Helps you get useful answers like "I don't know that's too recent" when you ask questions like "who won the basketball game last night".

manmal5• 8 months ago

That would explain why it’s so bad with new Swift features and more recent ast-grep rules.

mr_00ff00• 8 months ago

What is a pre-training run?

abixb4• 8 months ago

The first step in building a large language model. That's when the model is initiated and trained on a huge dataset to learn patterns and whatnot. The "P" in "GPT" stands for "pre-trained."

bckr• 8 months ago

That’s where they take their big pile of data and train the model to do next-token-prediction.

nodja3• 8 months ago

Pre-training is just training, it got the name because most models have a post-training stage so to differentiate people call it pre-training.

Pre-training: You train on a vast amount of data, as varied and high quality as possible, this will determine the distribution the model can operate with, so LLMs are usually trained on a curated dataset of the whole internet, the output of the pre-training is usually called the base model.

Post-training: You narrow down the task by training on the specific model needs you want. You can do this through several ways:

- Supervised Finetuning (SFT): Training on a strict high quality dataset of the task you want. For example if you wanted a summarization model, you'd finetune the model on high quality text->summary pairs and the model would be able to summarize much better than the base model.

- Reinforcement Learning (RL): You train a separate model that ranks outputs, then use it to rate the output of the model, then use that data to train the model.

- Direct Preference Optimizaton (DPO): You have pairs of good/bad generations and use them to align the model towards/away the kinds of responses you want.

Post-training is what makes the models able to be easily used, the most common is instruction tuning that teaches to model to talk in turns, but post-training can be used for anything. E.g. if you want a translation model that always translates a certain way, or a model that knows how to use tools, etc. you'd achieve all that through post-training. Post-training is where most of the secret sauce in current models is nowadays.

tim3338• 8 months ago

If you've an hour to spare this Karpathy video is good at explaining how it all works https://youtu.be/7xTGNNLPyMI

amluto• 8 months ago

I asked ChatGPT 5.1 to help me solve a silly installation issue with the codex command line tool (I’m not an npm user and the recommended installation method is some kludge using npm), and ChatGPT told me, with a straight face, that codex was discontinued and that I must have meant the “openai” command.

Coneylake• 8 months ago

"with a straight face"

mikepurvis• 8 months ago

I noticed this recently when I asked it whether I should play Indiana Jones on my PS5 or PC with a 9070 XT. It assumed I had made a typo until I clarified, then it went off to the internet and came back telling me what a sick rig I have.

mingodad• 8 months ago

Interesting enough today I found that https://huggingface.co/openai/gpt-oss-20b when downloaded an running locally and asked:

====

when have you been built?

I’m a GPT‑4‑based model that OpenAI released on March 14 2023. The underlying training data goes up to early 2023, and the model was trained in the months leading up to that release. If you’re asking about the ChatGPT product that ships the model to users, it went live in November 2022 and has since received updates (GPT‑3.5, GPT‑4, etc.) that keep it current.

====

But when supposedly running it from https://huggingface.co/chat/models/openai/gpt-oss-20b:

====

when have you been built?

I’m a language model created by OpenAI. The current generation (GPT‑4) that powers this chat was first released in March 2023 and has been updated and fine‑tuned up through the end of 2024. My training data runs up to the beginning of June 2025, so I’m built on knowledge available up to that point.

====

And that makes me thinking that although https://huggingface.co/chat claims to be using the models available to public at https://huggingface.co , it doesn't seems to be true and I raised this question here https://huggingface.co/ggml-org/gpt-oss-20b-GGUF/discussions... , https://github.com/huggingface/inference-playground/issues/1... and https://github.com/ggml-org/llama.cpp/discussions/15396#disc... .

mvkel• 8 months ago

It's not a rumor, it's confirmed by OpenAI. All "models" since 4o are actually just optimizations in prompting and a new routing engine. The actual -model- you are using with 5.1 is 4. Nothing has been pre-trained from scratch since 4o.

Their own press releases confirm this. They call 5 their best new "ai system", not a new model

https://openai.com/index/introducing-gpt-5/

Forgeties79• 8 months ago

Maybe this is just armchair bs on my part, but it seems to me that the proliferation of AI-spam and just general carpet bombing of low effort SEO fodder would make a lot of info online from the last few years totally worthless.

Hardly a hot take. People have theorized about the ouroboros effect for years now. But I do wonder if that’s part of the problem

m3kw92• 8 months ago

Well then 5.x is pretty impressive

Davidzheng• 8 months ago

I don't think that counts as confirmation. 4.5 we know was a new base-model. I find it very very unlikely the base model of 4 (or 4o) is in gpt5. Also 4o is a different base model from 4 right? it's multimodal etc. Pretty sure people have leaked sizes etc and I don't think it matches up.

staticman24• 8 months ago

New AI system doesn't preclude new models. I thought when GPT 5 launched and users hated it the speculation was GPT 5 was a cost cutting model and the routing engine was routing to smaller, specialized dumber models that cost less on inference?

It certainly was much dumber than 4o on Perplexity when I tried it.

krackers• 8 months ago

I can believe this, Deepseek V3.2 shows that you can get close to "gpt-5" performance with a gpt-4 level base model just with sufficient post-training.

mips_avatar3• 8 months ago

Usually current events get taught through mid-training, so even with old pre-training current events still could be added

hn_throwaway_992• 8 months ago

Just a minor correction, but I think it's important because some comments here seem to be giving bad information, but on OpenAI's model site it says that the knowledge cutoff for gpt-5 is Sept 30, 2024, https://platform.openai.com/docs/models/compare, which is later than the June 01, 2024 date of GPT-4.1.

Now I don't know if this means that OpenAI was able to add that 3 months of data to earlier models by tuning or if it was a "from scratch" pre-training run, but it has to be a substantial difference in the models.

xnx3• 8 months ago

OpenAI is in the "don't look behind the curtain" stage with both their technology and finances.

impulser_• 8 months ago

OpenAI is the only SOTA model provider that doesn't have a cutoff date in the current year. That why it preforms bad at writing code for any new libraries or libraries that have had significant updates like Svelte.

rvnx3• 8 months ago

State Of The Art is maybe a bit exaggerated. It's more like an early model that never really adapted, and only got watered down (smaller network, outdated information, and you cannot see thought/reasoning).

Also their models get dumber and dumber over time.

kristianp3• 8 months ago

I doubt it's that important that their dataset of current events is up to date. At this stage, I believe private and synthetic data comprises a large fraction of pretraining. Web search substitutes for current event pretraining.

f311a• 8 months ago

I tried OpenAI models for coding in Go, but they constantly say your syntax is not correct. Let me rewrite your whole file without `any`.`any` was introduced in 2022. It takes some time to adopt it in codebases, but they should not be doing stuff like that at the end of 2025.

jimbohn• 8 months ago

I wonder if the failures to pretrain are the result of our understanding of neural networks being more akin to alchemy rather than chemistry

wrcwill• 8 months ago

im not sure why we need to go off rumours, the knowledge cutoff for each openai model is clearly listed in the table:

https://platform.openai.com/docs/models/compare?model=gpt-5....

fovc• 8 months ago

Łukasz Kaiser basically confirmed it in a podcast:

https://youtu.be/3K-R4yVjJfU?si=JdVyYOlxUbEcvEEo&t=2624

Q: Are the releases aligned with pre-training efforts?
A: There used to be a time not that long ago, maybe half a year, distant past, where the models would align with RL runs or pretraining runs ... now the naming is by capability. GPT5 is a capable model; 5.1 is a more capable model

munk-a3• 8 months ago

I think most people are aligned on AI being in a bubble right now with the disagreement being over which companies (if any) will weather the storm through the burst and come out profitable on the far side.

OpenAI, imo, is absolutely going to crash and burn - it has absolutely underwhelming revenue and model performance compared to others and has made astronomical expenditure commitments. It's very possible that a government bailout partially covers those debts but the chance of the company surviving the burst when it has dug such a deep hole seems slim to none.

I am genuinely surprised that generally fiscally conservative and grounded people like Jensen are still accepting any of that crash risk.

marcofiset• 8 months ago

Jensen cashed out on a billion dollars. Why would he even care anymore at this point?

wolfgangbabad• 8 months ago

Google is too big to fail. It's the backbone of the Internet. Just YouTube is synonymous with online video.

kyyt• 8 months ago

I work with Gemini 3 daily, and I think the hype is unwarranted. It takes shortcuts, hallucinates and its UI seems way behind. And what's with the small fonts?

11101010001100• 8 months ago

If OpenAI is smart here, they would figure out that you can make more money on a flop than with a hit. I bet an AI would figure that out.

poemxo2• 8 months ago

The primary reason I have switched is that creative writing has plummeted on ChatGPT. It is overly eager to censor output that isn't adult but might vaguely be adult if taken incorrectly. This severely limits creative freedom. On the other hand, Gemini happily writes my stories.

I am not sure who OpenAI aims to please by nerfing their own product in this way. It can't be paying customers.

greenchair• 8 months ago

there was that teen who died after chat supposedly encouraged him to do bad things and his parents are suing now. so maybe more controls are being put in place to reduce risk.

meindnoch• 8 months ago

Going short OPAI.PVT 10x leverage.

kristianp3• 8 months ago

Googling OPAI.PVT brings me to https://finance.yahoo.com/quote/OPAI.PVT , which has links to equityzen and forgeglobal. How accurate are those valuations though?

itsjamesmurray• 8 months ago

History doesn't always repeat... but it sure as hell rhymes.

paxys3• 8 months ago

But hey they dumped $6.4 billion on Jony Ive. Surely he'll solve all their problems.

yalogin• 8 months ago

How does Anthropic fit into this? It's much smaller but feels like they have a much clearer product definition with their Claude Code.

montjoy• 8 months ago

Yes I’m wondering the same. I guess the news here is that google is finally getting the edge over OpenAI when they should have had the lead all along.

manmal5• 8 months ago

Is anyone actually getting good results out of GPT Pro? For coding problems, GPT Thinking seems faster and more accurate. Pro has given me some very dumb answers actually, totally misunderstanding the question. Once I asked it do design a reverse osmosis system for our home, and it suggested a 7k system that can produce 400 liters per minute. Even though I explicitly told it that a couple liters per minute suffice.

bamboozled2• 8 months ago

I’ve preferred Claude over ChatGPT for over a year so not sure what he’s on about.

hunter-gatherer• 8 months ago

Most comments here seem to discuss coding results. I know these are compared against industry benchmarks, but does anyone have experience using these with non CS related tasks? For example the other day I was brainstorming a kayak trip with both ChatGPT and Gemini 3.0. ChatGPT was off the rails. Trying to convince me the river flowed a different sirection than it does, and all sorts of weirdness. Gemini didn't provide information nearly as well as a human with experience, but it wasn't _useless_ information. The OpenAI model was a catasrophe at this. I'd be curious how the different models rate for the general audience, and if that plays into it at all.

davebren2• 8 months ago

This "all hands on deck" thing is a classic tactic managers use when they don't actually know what to do or have the domain expertise to allocate resources intelligently and help their employees do their jobs.

MikeTheGreat3• 8 months ago

(My apologies if this was already asked - this thread is huge and Find-In-Page-ing for variations of "pre-train", "pretrain", and "train" turned up nothing about this. If this was already asked I'd super-appreciate a pointer to the discussion :) )

Genuine question: How is it possible for OpenAI to NOT successfully pre-train a model?

I understand it's very difficult, but they've already successfully done this and they have a ton of incredibly skilled and knowledgeable, well-paid and highly knowledgeable employees.

I get that there's some randomness involved but it seems like they should be able to (at a minimum) just re-run the pre-training from 2024, yes?

Maybe the process is more ad-hoc (and less reproducible?) than I'm assuming? Is the newer data causing problems for the process that worked in 2024?

Any thoughts or ideas are appreciated, and apologies again if this was asked already!

octoberfranklin2• 8 months ago

You don't train the next model by starting with the previous one.

A company's ML researchers are constantly improving model architecture. When it's time to train the next model, the "best" architecture is totally different from the last one. So you have to train from scratch (mostly... you can keep some small stuff like the embeddings).

The implication here is that they screwed up bigly on the model architecture, and the end result was significantly worse than the mid-2024 model, so they didn't deploy it.

MikeTheGreat3• 8 months ago

Huh - I did not know that, and that makes a lot of sense.

I guess "Start software Vnext off the current version (or something pretty close)" is such a baseline assumption of mine that it didn't occur to me that they'd be basically starting over each time.

Thanks for posting this!

threeducks4• 8 months ago

I can not say how big ML companies do it, but from personal experience of training vision models, you can absolutely reuse the weights of barely related architectures (add more layers, switch between different normalization layers, switch between separable/full convolution, change activation functions, etc.). Even if the shapes of the weights do not match, just do what you have to do to make them fit (repeat or crop). Of course the models will not work right away, but training will go much faster. I usually get over 10 times faster convergence that way.

cherioo• 8 months ago

GPT4.5 was allegedly such a pre-train. It just didn’t perform good enough to announce and product it as such.

htrp• 8 months ago

it wasn't economical to deploy but i expect it wasn't wasted, expect the openai team to pick that back up at some point

encomiast• 8 months ago

I’m not sure what ‘successfully’ means in this context. If it means training a model that is noticeably better than previous models, it’s not hard to see how that is challenging.

mudkipdev• 8 months ago

OpenAI allegedly has not completed a successful pretraining run since 4o

MikeTheGreat3• 8 months ago

Ah. Thanks for posting - this makes a lot of sense.

I can totally see how they're able to pre-train models no problem, but are having trouble with the "noticeably better" part.

Thanks!

nodja3• 8 months ago

Genuine question: How is it possible for OpenAI to NOT successfully pre-train a model?

The same way everyone else fails at it.

Change some hyper parameters to match the new hardware (more params), maybe implement the latest improvements in papers after it was validated in a smaller model run. Start training the big boy, loss looks good, 2 months and millions of dollars later loss plateaus, do the whole SFT/RL shebang, run benchmarks.

It's not much better than the previous model, very tiny improvements, oops.

thefourthchime• 8 months ago

Isn't that what GPT 4.5 was?

yalok• 8 months ago

add to it multiple iterations of having to restart pretraining from some earlier checkpoint when loss plateaus too early or starts increasing due to some bugs…

danielodievich• 8 months ago

Last week there we had a customer request that landed in our support on a feature that I partially wrote and wrote a pile of public documentation on. Support engineer ran customer query through Claude (trained on our public and internal docs) and it very, very confidently made a bunch of stuff up in the response. It was quite plausible sounding and it would have been great if it worked that way, but it didn't. While explaining why it was wrong in a Slack thread with support engineer and another engineer who also worked on that feature, he ran Augment (that has full source code of the feature) which promptly and also very confidently made up more stuff (but different!). Some choice bleeding eye emojis were exchanged. I'm going to continue to use my own intelligence, thank you.

scotty79• 8 months ago

Yeah, LLMs are not really good about things that can't be done.

At some point you'll be better off with implementing features they hallucinated. Some people with public APIs already took this approach.

empressplay• 8 months ago

This is the way. (Sadly)

131hn• 8 months ago

They are trained with 100% true facts and sucessfull paths.

We humans grec our analysis/reasoning skills towards the 99.9999% failed attempts of everything we did, uncessfull trials and errors, wastefull times and frustrations.

So we know that behind a truth, there’s a bigger world of fantasy.

For LLM, everything is just a fantasy. Everything is as much true as it’s opposite. It will need a lot more than the truth to build intelligence, it will require controled malice and deceptions

AdieuToLogic• 8 months ago

> Support engineer ran customer query through Claude (trained on our public and internal docs) and it very, very confidently made a bunch of stuff up in the response.
Yeah, LLMs are not really good about things that can't be done.

From the GP's description, this situation was not a case of "things that can't be done", but instead was the result of a statistically generated document having what should be the expected result:

  It was quite plausible sounding and it would have been 
  great if it worked that way, but it didn't.

tomp2• 8 months ago

I don't know man.

My code runs in 0.11s

Gemini's code runs in 0.5s.

Boss wants an explanation. ¯\_(ツ)_/¯

loloquwowndueo• 8 months ago

As long as the explanation is going to come out being wrong, I’m sure you can whip something up in 0 seconds.

brazukadev2• 8 months ago

0.11s is faster than 0.5s

kristianp3• 8 months ago

How is that comment relevant to this story about OpenAI's response to perceptions that Google has gained in market share?

varenc• 8 months ago

Popular HN threads about anything AI related always attract stories highlighting AI failures. It's such a common pattern I want to analyze it and get numbers. (which might require AI...)

raincole• 8 months ago

Welcome to Hacker News. You're allowed to post anti-AI, anti-Google or anti-Musk content in any thread. /s

pllbnk• 8 months ago

It's relevant because it shows models haven't improved as much as the companies delivering them would like you to believe no matter what mode (or code) they work under. Developers are quickly transforming from code writers to code readers and the good ones feel demoralized knowing that they could do it better themselves but are instead forced to read gibberish produced by a machine in the volume of dozens of lines per second. Moreover, when they are reviewing that gibberish and it doesn't make sense, even if they provide arguments, that same gibberish-producing machine can, in a matter of seconds, write counter-arguments that look convincing but lack any kind of substance for those who understand and try to read it.

Edit: I am saying it as a developer who is using LLMs for coding, so I feel that I can constructively criticize them. Also, sometimes the code actually works when I put enough effort to describe what I expect; I guess I could just write the code myself but the problem is that I don't know which way it will result in a quicker delivery.

pshirshov3• 8 months ago

All depends on the tasks and the prompting engineers.

Even with your intelligence you would need years to deliver something like this: https://github.com/7mind/jopa

The outcome will be better for sure, but you won't do anything like that in a couple of weeks. Even if you have a team of 10. Or 50.

And I'm not an LLM proponent. Just being an empirical realist.

ramraj07• 8 months ago

"trained on our public and internal docs" trained how? Did you mean fine-tuned haiku? Did you actually fine tune correctly? Its not even a recommended architecture.

Or did you just misuse basic terminology about LLMs and are now saying it misbehaved, likely because your org did something very bad with?

oersted• 8 months ago

Relying on the model’s own “memory” to answer factual queries is almost always a mistake. Fine-tuning is almost always a more complex, more expensive and less effective method to give a model access to a knowledge base.

However using the model as a multi-hop search robot, leveraging it’s general background knowledge to guide the research flow and interpret findings, works exceedingly well.

Training with RL to optimize research tool use and reasoning is the way forward, at least until we have proper Stateful LLMs that can effectively manage an internal memory (as in Neural Turing Machines, and such).

oars• 8 months ago

Since the release of Google Gemini 3 two weeks ago, the seven-day moving average of ChatGPT's daily unique active users has declined by 6%.

https://www.moomoo.com/news/post/62341840/why-has-openai-ini...

zubiaur• 8 months ago

Kids off school for thanksgiving?

ugh123• 8 months ago

This guy parents.

bmadduma• 8 months ago

Word needs need OpenAI and Anthropic like startups to drive AI forward. Think about only Google, Meta, MS, AWS is only have these capabilities. They will never able to do that in one hand, other hand it will be monopolistics. We need more AI startups, not monopolies.

29athrowaway• 8 months ago

OpenAI fragmented into multiple companies that are now competing against them. OpenAI is buying compute and data.

Meanwhile, Google consolidated their AI operations under Google Deepmind and doubled down on TPUs.

The strategy "solve AGI and then solve everything else" is an all-in gamble that somehow AGI is within reach. This is not true.

sidibe• 8 months ago

Google fragmented into multiple competing companies as well, that's where OpenAI itself came from. The problem is even after shedding employees into all these startups or established competitors trying to catch up, Google has way more people, money, and compute to throw at things and see what works than the rest of the industry. It's demoralizing and tempting for people to go back, which is also demoralizing

paxys3• 8 months ago

I think we are finally seeing the effects of the steady stream of departures of top researchers and leaders from OpenAI since last year. Sure you can declare a "code red", but who is going to lead the effort? Set the direction? Do the heavy lifting? Chart the path forward? Sam Altman is a salesman, not a researcher. Ilya is no longer around. Most of the other top brass has been poached by Google/Meta/Anthropic or left to start their own thing. The people left behind are probably good at iterating, but can they really make the next leap forward on their own?

HardCodedBias• 8 months ago

This is the system working.

Competition is all you need.

montyboy_us• 8 months ago

Listen, I just had to go through numerous prompt cycles to 'prove' to 5.1 that we had a new Pope. ChatGPT was dead set that I was reading 'unreliable sources'. The data is _old_.

mmis1000• 8 months ago

Most discussion focused on capabilities. But I wonder does OpenAI's "make a even big and costly model" strategy even work in long term? They are already losing money at current size. Unless we have some break though in chip efficiency.(which didn't seem to be likely for now) They are only going to loss even more.

zhyder• 8 months ago

It's all about the chip economics. I don't know how the _manufacturing cost_ of Google's TPUs compares to Nvidia's GPUs, for inference of equivalent token throughput.

But at the moment Nvidia's 75-80% gross margin is slowly killing its customers like OpenAI. Eventually Nvidia will drop its margins, because non-0 profit from OpenAI is better than the 0 it'll be if OpenAI doesn't survive. Will be interesting to see if, say, 1/3 the chip cost would make OpenAI gross margin profitable... numbers bandied in this thread of $20B revenue with $115B cost imply they need 1/6 the chip cost, but I doubt those numbers are right (hard to get accurate $ numbers for a private company for the benefit of us arm-chair commenters).

mrtksn• 8 months ago

Yes, from the first principles perspective this AI thingy is just about running electricity through some wires printed on silicon by a Taiwanese company using a Dutch machine. Which means, up until the Taiwanese you have plenty of room to cut margins up until that point the costs are mostly greed based. That is Nvidia is asking for the highest price the customer can pay and they have quite a way to the cost that define their min price. Which means AI companies can actually keep getting better deals until the devices delivered to them are priced close to TSMCs bulk wafer printing prices.

hackermeows• 8 months ago

isn't MSFT the one screwed here. Who is on the line to provide more compute for them .

andai2• 8 months ago

They don't have much to worry about as long as Google keeps focusing on the models and neglecting the experience of actually using them.

jatins• 8 months ago

Gemini app is pretty solid and aistudio is a good dev focused offering. GCP and Vertex AI is still a bit of a mess but I wouldn't say the overall UX is too bad at this point

user3939382• 8 months ago

I have the research to win the race. These people are masters of the fog.

VeejayRampay• 8 months ago

what do you mean "catches up"

Gemini has been as good as GPT for more than a year

OpenAI still somehow gets the edge on the initial veneer of hype, and that's running thin

d--b• 8 months ago

Code red?

Altman should know better. This sends terrible signals to employees, stakeholders and customers.

You don’t solve quality problems by scrambling teams and increasing pressure.

This reeks of terrible management. I can imagine Stanford graduates grinding it past midnight for “the mission”. If any if you is reading this: don’t do it. Altman is screwing you over. There are plenty of other places that won’t code-red your christmas season while having hundreds of billions of dollars in cash.

bokkies• 8 months ago

What are devs using to run Gemini agents in vscode? 2.5pro on Cline/Roo was pretty buggy compared to Claude/gpt4/5 (also using Cline /roo), kept getting stuck in loops outputting repeated text and many editing issues, and much much worse than Claude code or codex. Has it gotten better? Is there a better way of using Gemini in vscode?

bamboozled2• 8 months ago

It’s funny because it wasn’t long ago Open Ai was telling everyone else it’s game over.

siliconc0w• 8 months ago

This sounds like the wrong move- focusing on the product layer and counter positioning on ads is the way to beat G

outside1234• 8 months ago

OpenAI is toast. Google has a model advantage, hardware advantage (TPUs), and business advantage (I hear they are good at selling ads).

It is all physics from here.

rvnx3• 8 months ago

They are also good at selling cloud hosting and services like LLMs (despite their horrible billing practices where there is no limit)

dr_kretyn• 8 months ago

Personally I find the current Google products mediocre almost on all aspects. The killer feature of chat bots is voice chat and ChatGPT works great, and Gemini is extremely quiet without a way to increase volume. It's also difficult to figure out how to sign up for Gemini, or even the keyboard that I'm typing is making so many incorrect predictions. I just don't trust Google. To me they're pure marketing and their engineering excellence ended a few years ago.

socketcluster• 8 months ago

I declared 'code red' at my house as Google, OpenAI and Anthropic catch up in my software development career race.

junkaccount• 8 months ago

Fix: Bring back Ilya, fire Sam Altman.

ares6232• 8 months ago

Ilya’s doing fine raking in billions for what’s effectively a D&D campaign

baalimago• 8 months ago

For once, capitalism works

curioussquirrel4• 8 months ago

This is probably not a core concern for most HN readers, but at work we do multilingual testing for synthetic text data generation and natural language processing. Emphasis on multilingual. Gemini has made some serious leaps from 1.5 to 2.5 and now 3.0, and is actually proficient in languages that other models can only dream of. On the other hand, GPT-5 has a really mixed performance in a lot of categories.

jimmydoe• 8 months ago

Very good to know. I use Gemini for many translation related work, the 1m windows is very helpful too.

deaux7• 8 months ago

This goes way back. Even back in the 1.5 days it was the best multilingual model, when HN still treated it as entirely uncompetitive all-around. Just because, exactly as you're saying, it's not a core concern of people here. The two fields Gemini models have been number one at for years now are A. multilinguality B. image understanding. At no point since the release of Gemini 1.5 Pro way back has any Anthropic or OpenAI model done performed better at either.

Even those who have zero experience with different (human) languages could've known this if they liked, from the fact that on the LMArena leaderboards, Gemini models have consistently ranked much higher in non-English languages than in English. This gap has actually shrunk a lot over time! In the 1.5 Pro days this advantage was huge, it would be like 10th in English and 2nd in many other languages.

Nevertheless, it still depends on the specific language you're targeting. Gemini isn't the winner on every single one of them. If you're only going to choose one model for use with many languages, it should be Gemini. But if the set of languages isn't too large, optimizing model selection per language is worth it.

curioussquirrel4• 8 months ago

In our previous tests, when it was 1.5 Pro against GPT 4o and Claude Sonnet 3.7, Gemini wasn't winning in the multilingual race, but it was definitely competitive. 2.5 and 3.0 seems to be big leaps from the 1.5 days. That said, it also depends on the testing methodology; we tested a bunch of use cases mostly to test core linguistic proficiency. Not as much complex tasks in language or cultural knowledge.

curioussquirrel4• 8 months ago

And regarding specific models - we obviously only tested a few languages, and there are thousands of them in the world. But Gemini seems to lead the pack basically regardless of the language your throw at it. YMMV.

motbus3• 8 months ago

Why doesnt he ask chat gpt to solve it all? He sells it saying it does everything!

dainiusse• 8 months ago

As for my use cases, google and especially anthropic are not "catching up". They are better for long time already

bilekas2• 8 months ago

Altman said the company will be delaying initiatives like ads, shopping and health agents, and a personal assistant, Pulse, to focus on improving ChatGPT

It's so telling that they're delaying these "festures" because the know full well people don't want them.

apples_oranges2• 8 months ago

I don't understand this view. I think most people would be happy to use the best models for free in exchange for seeing ads. That's basically what google and many others successfully do for decades.

bilekas2• 8 months ago

Because it will degrade experience entirely, and companies always go too far with it. Advertisement online these days is so intrusive it's a slog to browse without some form of adblocker.

When the AI starts suggesting products or services without being straight up about it, it's not giving you 'knowledge' it's just feeding you whatever it's been paid to say. If that's what you want, power to you.

gherkinnn• 8 months ago

I remember, maybe 2-3 years ago, chuckling at Google with their Bard naming and being late to the game and so on. It seems like I was very wrong and that they caught up quickly enough. I was also wrong in thinking MS doing well, when their recent Copilot moves across Office, Windows, and GitHub have been a joke.

redbell• 8 months ago

The current situation of OpenAI is difficult. At present time, even the giants (Meta, MS, Apple, AMZN) with deep pockets would find it extremely challenging to compete against Google in the AI race, let alone a VC-funded startup.

•Google has data, a lot of private data actually (YT, Gmail, Workspace, Search Queries.. you name it) •Google has a lot of money •Google has top-talented AI engineers (Eying on DeepMind & Demis Hassabis staff) •Google has a huge userbase

With $20B in ARR and hundreds of billions in funding, would OpenAI be able to make its own remontada as Google did? I'm not sure, but it would be a long challenging journey.

mvcosta91• 8 months ago

They also control their own hardware stack with TPUs.

golfer6• 8 months ago

TIL the phrase remontada -- thank you :)

Slang term for comeback

hansmayer4• 8 months ago

Funny that they did not declare "code red" when the CEO committed to 1.4T investments with only 13B in revenue to show?

segmondy• 8 months ago

Title should really be OpenAI declares 'code red' as OpenAI falls behind in the AI race. Google, Anthropic, Mistral, DeepSeek, Tencent, Alibaba, Moonshot, Zai, etc have all made great strides. OpenAI has been falling behind in terms of velocity while everyone else is moving faster

neves• 8 months ago

It's just me or this article looks like propaganda? A traditional advertising nice is to plant news attacking your adversaries. This empty article looks like just part of the advertising machine of new Google model release.

olalonde• 8 months ago

We will attempt to directly build safe and beneficial AGI, but will also consider our mission fulfilled if our work aids others to achieve this outcome.

They must be really glad to have so much competition then.

If a value-aligned, safety-conscious project comes close to building AGI before we do, we commit to stop competing with and start assisting this project.

I wonder if OpenAI will start assisting Google now?

ActionHank• 8 months ago

This will be the premise under which MS will acquire OAI talent after all the money has disappeared.

danirogerc• 8 months ago

This is great for customers.

gverrilla• 8 months ago

I don't read AI news or follow the industry, and from my perspective as a chatgpt user from day 1 is it's stalled for a long time now without improvements. The model feels old at this point. Claude Code highly impressed me, though.

Frannky• 8 months ago

The first models were really bad, but the new models are very good—both text and image. They were able to clean up the embarrassing start and catch up. It's very interesting/scary that a giant corporation can develop things that new startups generated and deliver an alternative product on par with them.

danny_codes• 8 months ago

I don’t understand why anyone would think LLMs have a good moat. There’s no evidence to suggest that’s the case, and plenty of evidence to the contrary. Maybe hubris?

OpenAI declares 'code red' as Google catches up in AI race

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