The AI Pricing Revolution
With Generative AI’s budding reasoning capabilities, a new class of agentic applications is starting to emerge.
What shape do these application layer companies take? Interestingly, these companies look different than their cloud predecessors:
What shape do these application layer companies take? Interestingly, these companies look different than their cloud predecessors:
- Cloud companies targeted the software profit pool. AI companies target the services profit pool.
- Cloud compa
Pat Grady • Generative AI’s Act O1
AI Raises a Big Question, but Legacy Industries Have Already Answered It
Jackie DiMonteopen.substack.com
Here are three observations about the economics of AI:
1. The intelligence of an AI model roughly equals the log of the resources used to train and run it. These resources are chiefly training compute, data, and inference compute. It appears that you can spend arbitrary amounts of money and get continuous and predictable gains; the scaling laws that... See more
1. The intelligence of an AI model roughly equals the log of the resources used to train and run it. These resources are chiefly training compute, data, and inference compute. It appears that you can spend arbitrary amounts of money and get continuous and predictable gains; the scaling laws that... See more