Windows and Android took the commodity approach but they always had a business model, while Meta AI is currently running on Underpants Gnomes economics.

1. Spend billions on a product, then give it away for free.

2. ???

3. Profit!

> Then Meta announced open sourcing Horizon OS.

Open sourcing isn't really the right term, they're allowing third party hardware vendors to use it but it's still proprietary. Horizon OS is built on top of Android and they're following the Android playbook where the core is technically open source but the version nearly everyone actually uses has a bunch of proprietary Google (or Meta) software layered on top, and Google (or Meta) dictates the terms of using that software, which lets them ensure that revenue always flows back to Google (or Meta) regardless of who made the hardware.

They use the models they opensource in their own products, no? I don’t think Meta is looking to profit selling LLMs…

Not exactly "sell", but I do recall Zuckerberg saying that they have a revenue sharing agreement with platforms like AWS Bedrock that offer Llama inference.

> "I don’t think Meta is looking to profit selling LLMs…"

Said no one ever.

OP said it… I also don’t think meta is looking to sell LLMs.

Probably LLM backed products. Likely marketing tools if anything.

But not the same way OAI sells LLMs

Maybe not "sell" but if you look at my other comment on this post you'll see their valuation has increased 162 billion since they released their first open source model. They definitely are looking to profit, they just take a different approach to monetization. Same thing in my book.

Excellent move to juice the stock price but it’s not profit. I think it’s more a hope for profit one day, a ticket to the game.

So you’re saying Meta stock grew this year because they released an open source LLM?

It's probably part of it oddly enough as investors want to stick money in stocks that can be classified as 'AI'.

> They definitely are looking to profit

Since when? Lol

Don't they charge cloud vendors who sell LLAMA models on their platform? My understanding is that is part of the licensing agreement. Its more like:

1. Spend billions on a product.

2. Make it free to work with and charge to commercialize it.

3. Profit

Meta and Google are the companies most able to monetize AI-generated or AI-enhanced[1] content on their respective properties.

1. Meta showed off automatic audio translation that preserves speaker's voices. Content creators can now expand their following beyond their spoken languages, generating more ad impressions.

To quote Zuck:

>Why Open Source AI Is Good for Meta

>Meta’s business model is about building the best experiences and services for people. To do this, we must ensure that we always have access to the best technology, and that we’re not locking into a competitor’s closed ecosystem where they can restrict what we build.

I guess that would translate to

1. Spend billions on AI, give away open source version

2. Use AI to get people to click on ads in their "best experiences and services for people"

3. $39bn profit in 2023

It's a bit like the real Underpant Gnomes business. Phase gnomes one collect underpants. Phase two Parker and Stone sign a $900m deal with Paramount. The money is made by an associated business.

OCP has been about for _years_. Almost since facebook was a thing.

Facebook the site had a rich platform until they had to secure it against people stealing your data, and your mate's data and pretending that they had a really rich dataset on most of the western world's adult population (ie Cambridge analytica )

Horizon OS is a fucking mess and isn't anything really to do with Apple, its more to do with the making sure samsung don't use android for what ever shit they produce.

OpenAI aren't going to compete with Meta, as they aren't in the same game. OpenAI has to make money from its offerings, Meta's AI shit is a byproduct of other things (see massive spending on "reality labs")

> That title is most definitely a swipe at OpenAI.

Eh, 'OpenAI' is a swipe at OpenAI.

I've used OpenAI's tech, and I've used their competitors tech, but I've never used any of Facebooks AI tech yet. Is there something I'm missing out on?

Meta = LLaMA

I think the bet is that many other things will use their llama that you then use. Perhaps without you even knowing this.

Ever heard of pytorch?

Never used it myself, but that's a good call out and precisely why I asked.

Running a (405B) flagship model locally on a Mac Studio? Otherwise, no. Most of these products are fairly similar.

What is EEE?

Embrace, Extend, Extinguish.

Famously the Microsoft strategy against Java.

Somewhat related to their FUD policy towards linux

Yes this is what I meant. Sorry I was being lazy at the keyboard

I assume it’s embrace, extend, extinguish:

https://en.m.wikipedia.org/wiki/Embrace,_extend,_and_extingu...

OpenAI does not have its own platform yet but depend on Azure? If so, they probably should build their platform to squeeze out as much cost as possible.

They have their own platform - a platform to build AI tools on top of their API. The hardware layer below is abstracted away.

macOS isn't a premium product over Windows nor is iOS over Android. Windows isn't really an open platform either. OpenAI is more open as it doesn't require logging in.

A simple narrative doesn't exist connecting these three product battles. The only thing that comes to mind is macOS, iOS and OpenAI are designed for the novice. You could probably add Coinbase vs Binance or Uber vs Lyft or Facebook vs Google Plus and be able to keep that narrative.

Apple is undeniably a premium product for consumers, and its OSes get the halo effect from that. Whether they're "premium" to develop or even use for is an entirely different question.

Ironically macOS is more "open" (as in source available) than Windows.

https://opensource.apple.com/releases/

Microsoft was anti open source until the world changed. Windows was never open source or source available. It's ironic they own github. It is more shocking macOS is source available.

> It is more shocking macOS is source available.

Nitpick: It's actual Open Source, not Source Available. Not the whole thing, but what code they release is under permissive open source licenses.

Sorry, mostly permissive licenses; there are a tiny number of copyleft things in there (famously, the last GPLv2 version of bash)

Meta's VR wasn't really a lot more closed to be honest. They've just dropped the deep review process and anyone can now publish to the main store what was previously 'app lab'. They've been heading this way for a long time, a couple years ago they didn't even have app lab.

And the OS being open isn't really that relevant unless you're a system integrator. I really doubt whether this is in response to Apple. They seem to operate in entirely different markets. I love VR but I can never buy a vision pro. It's twice what I've ever spent on my most expensive car.

Oculus devices and AVP are presently in different categories from a cost perspective, but my understanding is the two companies were chasing after the same eventual market. Apple intended (intends?) on releasing a lower end device. Arguably AVP was meant as dev device anyway so devs could start building apps. And Meta was working on a higher end device until they nixed it after AVP sales tanked. Zuck himself went on a PR attack campaign about superiority of their technology vs Apple's.

> “I finally tried Apple’s Vision Pro,” Zuckerberg says. “And I have to say, before this, I expected that Quest would be the better value for most people since it’s really good and seven times less expensive but after using it, I don’t just think Quest is the better value. I think Quest is the better product period.”

The longer term horizon here seems to be that Reality Labs will release AR glasses that may have more mass appeal, and I would expect Apple will too.

Apple is more about luxury branding than premium offering. I don't think OpenAI is trying to position its services as projecting wealth or style.

Facebook's hardware designs don't really help them differentiate since they don't run a public cloud. If they release the open source hardware and successfully drum up interest, then it will be cheaper for them to procure hardware.

Releasing Llama guards against Google AI dominance. Google and Facebook are longtime competitors and Google controls the OS on most phones Facebook needs to run its ads on.

Open sourcing AI hardware guards against a potentially dominant Nvidia, especially if they team up with one of the cloud companies.

I'm sure they're also worried about OpenAI, but at this point it doesn't look like OpenAI is on Facebook's turf.

> Apple is more about luxury branding than premium offering. I don't think OpenAI is trying to position its services as projecting wealth or style.

What do you think OpenAI hired Jony Ive to do? ;)

https://www.theverge.com/2024/9/21/24250867/jony-ive-confirm...

Regardless, I meant premium as in better or dominant in the market. It's hard to overcome first mover advantage with a "me too" product, but "commoditizing your complement" seems to be a pretty effective disrupter. I think Meta is worried about Google, OpenAI, Anthropic, and anyone else with gen AI models. It seems to be related to where they're going.

For many, the terms 'luxury' and 'premium' are interchangeable, signifying both high quality and exclusivity. Most Apple users, may not be able to list specific specs of their devices — a testament to the brand's focus on overall user experience rather than technical details. Ask any Apple user if their device is superior to that of the competition, and the majority will affirm it does, because it just feels premium.

Just as most Mercedes owners don’t really care how many horsepower the car has. It just has “enough”.

Great analogy.

Meta knows it can’t be the top player in this space, their best play, therefore is to control the second tier. Ironically I think they aren’t even the best in the second tier - Mistral is.