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Model Price Cuts Are Rocket Fuel for the AI Economy
Rohan Paul points out that frontier labs are seeking protection under the guise of the 'China threat,' which is actually to maintain their business model. The model layer is only a small part of the AI economy; if inference costs drop by 10-100 times, it will inject rocket fuel into the downstream application layer. Citing @chamath, protecting the equity of OpenAI and Anthropic, which is held by only 5,000 people, is less important than letting the market decide; price cuts will expand the entire AI industry pie.
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