That seems like pretty good evidence of current and ongoing explosive growth. Much of this revenue is pre-paid (re: cashflow). Meanwhile, operating margins went from -184% to -$4%.
Seems like pretty good evidence. Will growth continue apace? Unknown. But the arguments for Jevon's paradox applying to intelligence seem pretty convincing, so the TAM here seems likely to be enormous.
> All while everyone is discovering there isn’t really a secret sauce moat to demand
Also not convinced by this. The Chinese models seem to have distilled their way to current levels, with Anthropic and OpenAI now getting serious about defending against this.
I don't think you're definitely wrong in all this. Rather, I think your claims are too confident.
Bonuses (owed under preexisting agreements) were an unfortunate necessity. The USG effectively nationalized AIG because it was determined to be too systemically important to be allowed to chaotically fail. So, the new owners needed to retain the employees necessary to continue its operations. To do so, they had to honor employee compensation agreements.
This turned out to be a wise move as the American taxpayer ended up turning a profit on the AIG bailout.
And it wasn’t as though the bonuses were uncontroversial. They were possible bc of loopholes in the bailout legislation. But the government was furious and, alongside public outrage, pressured the executives to give the back bonuses. The house of representatives even passed a bill to tax the bonuses at 90%. Many did voluntarily give them back.
> So, the new owners needed to retain the employees necessary to continue its operations. To do so, they had to honor employee compensation agreements.
At that point, compensation agreements with a previously solvent employer are... negotiable.
There's no "had to" in that scenario.
The government wanted to retain the people who knew how to run the thing. Those people wanted the most money they could get.
The deal could have been whatever the two of them struck -- and the public anger was/is that historically the government hasn't bargained very hard against the leadership of companies in that scenario.
With respect, I think this is a naive opinion. The banks that were bailed out were systemically important. This would not have been normal bankruptcies, with a very real risk of plunging the U.S. into a depression as bad as or worse than the Great Depression. So, the objective was to prevent that. And in order to keep these institutions in good working order by retaining the key employees who operated the institutions, bonuses were approved. It was distasteful and there was significant public and legislator outrage.
And, once again, the taxpayer turned a tidy profit on the bailouts.
Likely anything that goes beyond missing out on compensation (ex: unvested RSUs) or even clawing back some comp would violate labor laws. CEOs are still employees, and legislation regulating employer-employee relations trumps all contracts.
A lot of these labor laws get less protective for higher-ranked people in a company, whether it be due to thresholds based on compensation or explicit carve-outs for executives/board members. It varies a lot from place to place.
In the US, there is only one labor law that is different for execs and high paid employees and that is overtime rules. Fiduciary duty does govern how a director or officer behaves while in the role, loyalty, no self-dealing, no stealing corporate opportunities etc. It doesn't oblige them to stay or dictate how they must leave.
In US and English law, "specific performance", so a court ordering you to do what you promised, isn't available for personal service contracts. In the US that's reinforced by the 13th Amendment's ban on involuntary servitude. So even if a CEO signed a contract promising 6 months notice and a smooth handover, the company can't make them do it, they can only enforce any financial penalties that are contracted.
There are many many instances where the CEO is not an employee, but they operate via their own legal entity. To be honest I don't know how this works at larger companies.
I'd never heard of this. It turns out it is very rare for publicly traded companies [1]. In these cases, I would guess it comes down to contract terms. But again, it's not as though the law would compel an individual to continue working at a company. It would just come down to what the contracts say, and, potentially, how the courts interpret those contracts in the event of a lawsuit.
[1] Examples I found: Worksport Ltd., Exicure, Inc., Rainmaker Worldwide Inc., and Acorn Energy, Inc.
Yes, CEOs pay taxes on income. The only way around that is to structure the compensation so it's not income, and the IRS probably has tried to prevent that as much as possible. I'm not a tax or HR expert but I'd think unrealized gains on stock compensation might not be. Deferred compensation might not be, until it's actually paid.
'Fair play' is a dimension of competition. They aren't orthogonal attributes.
You can compete fairly or unfairly.
In any event, distillation seems to be in a grey enough area that reasonable people can disagree (IMO). It strikes me as more akin to theft than to fair competition, but it doesn't seem like it should be treated as criminal. Rather, I think the onus should be on the labs to defend themselves against it.
All that said, Jensen's take is clearly quite biased.
Hasn’t it already been ruled by a court that LLM outputs are not subject to copyright? It opens a can of worms to say that LLM companies can dictate what their outputs are used for.
I think copyright is mostly not relevant. Contracts operate mostly independent of copyright law (in the U.S.). If OpenAI puts in their license something to the effect of "you may not train your LLMs on these outputs" and/or "your access is limited in these ways", but you violate the license, they can and should block your access and sue you. These are things that can be monitored and enforced under existing law.
And, in fact, they already do this:
- OpenAI [1]: "[you may not] Use Output to develop models that compete with OpenAI."
- Google [2]: "You may not use the Services to develop machine learning models or related technology."
- Anthropic [3]: "[You may not use our services] to develop any products or services that compete with our Services, including to develop or train any artificial intelligence or machine learning algorithms or models or resell the Services"
> In my community, [strawberry leaves are] considered medicine
Huh? What does this mean? Isn't this a binary? Either they are or are not medicine. I don't "consider" Tylenol a medicine. It is because it has an effect.
And all of that (along with the serious problems in how WMF/Wikipedia operate) is why I no longer donate to WMF.
Clearly, they don't need my money. But if they ever want to bring me back into the fold, they need to adopt Larry Sanger's prescriptions. This unionization seems likely to push WMF (IMO) further in the wrong direction.
I think all employees should work for a union. My local art museum has a union. My local school system has a union. The non-profit university I graduated from has a union. Why shouldn't WMF have a union?
I really don't understand the bitterness toward them. If you look at their data, their donations are growing faster than their expenses.
The people who donate to Wikipedia/WMF want more money to go into the organization. That's the whole point of the donation. What else do you want them to do with the money exactly?
I can't think of a single unionized organization that is run as well as or better than union-free organizations. Unionized companies all seem to be crippled by bureaucracy and unable to improve performance and output.
Professional sports is probably a good counter example. Major League Baseball, for example, treats the players better than any other baseball league around the world and most of the gains were achieved through collective bargaining.
Or how about Hollywood writers? The Writers Guild of America writers are responsible for most of the most successful movies and TV of the past decade or two (maybe longer). WGA writers are treated better than just about any other screenwriters around the world.
The daycare my parent friends go to can’t retain a teacher for longer than a year or two. I hear stories all the time about the disruption and emotional distress abruptly losing a teacher with a 1-2 weeks notice causes.
The PreK teacher at the local public school has been there over 10 years at the same school and has a masters degree. Union, of course.
I’m sure the public school system is more expensive overall. You get what you pay for.
My experience is that unions very often make things stupider and less efficient.
I've been forced to give to two of them that were basically just political cosplay by children (well really the $ was taken without consent before it was even in my hands, so it was stolen)
And I've had the displeasure of working in a factory environment that was unionized. Perhaps there was a time when this made sense, but I think those instances are rare now.
I would submit the idea that a lot of union reforms that have been made to laws in the US have been specifically designed to make unions less attractive and less incentivized toward positive outcomes.
Thanks for the reference. I am interested in your specific perspective as opposed to someone else's (much less else the received opinions from The Experts).
According to the S1:
- FY24 revenue $386 million -> FY25 revenue $4.59 billion (+1,008%)
- Q126 revenue $4.7 billion -> Q26 revenue $11.5 billion (+145%)
That seems like pretty good evidence of current and ongoing explosive growth. Much of this revenue is pre-paid (re: cashflow). Meanwhile, operating margins went from -184% to -$4%.
Seems like pretty good evidence. Will growth continue apace? Unknown. But the arguments for Jevon's paradox applying to intelligence seem pretty convincing, so the TAM here seems likely to be enormous.
> All while everyone is discovering there isn’t really a secret sauce moat to demand
Also not convinced by this. The Chinese models seem to have distilled their way to current levels, with Anthropic and OpenAI now getting serious about defending against this.
I don't think you're definitely wrong in all this. Rather, I think your claims are too confident.
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