The wisest move in the chatbot business might be to wait and see if anyone discovers anything profitable before spending more effort and wasting more money on chat R&D, which includes most agentic stuff. Reliable assistants or something along those lines might be the next big breakthrough (if you ask certain futurologists), but the technology we have seems unsuitable for any provable reliability.
ML can be applied in a thousand ways other than LLMs, and many will positively impact our lives and create their own markets. But OpenAI is not in that business. I think the writing is on the wall, and Sama's vocal fry, "AGI is close," and humanity verification crypto coins are smoke and mirrors.
Most people in society connect AI directly to ChatGPT and hence OpenAI. And there has been a lot of progress in image generation, video generation, ...
So I think your timeline and views are slightly off.
GPT-2 was released in 2019, GPT-3 in 2020. I'd say 2020 is significant because that's when people seriously considered the Turing test passed reliably for the first time. But for the sake of this argument, it hardly matters what date years back we choose. There's been enough time since then to see the plateau.
> Most people in society connect AI directly to ChatGPT and hence OpenAI.
I'd double-check that assumption. Many people I've spoken to take a moment to remember that "AI" stands for artificial intelligence. Outside of tongue-in-cheek jokes, OpenAI has about 50% market share in LLMs, but you can't forget that Samsung makes AI washing machines, let alone all the purely fraudulent uses of the "AI" label.
> And there has been a lot of progress in image generation, video generation, ...
These are entirely different architectures from LLM/chat though. But you're right that OpenAI does that, too. When I said that they don't stray much from chat, I was thinking more about AlexNet and the broad applications of ML in general. But you're right, OpenAI also did/does diffusion, GANs, transformer vision.
This doesn't change my views much on chat being "not seeing the forest for the trees" though. In the big picture, I think there aren't many hockey sticks/exponentials left in LLMs to discover. That is not true about other AI/ML.
We do appear to be hitting a cap on the current generation of auto-regressive LLMs, but this isn't a surprise to anyone on the frontier. The leaked conversations between Ilya, Sam and Elon from the early OpenAI days acknowledge they didn't have a clue as to architecture, only that scale was the key to making experiments even possible. No one expected this generation of LLMs to make it nearly this far. There's a general feeling of "quiet before the storm" in the industry, in anticipation of an architecture/training breakthrough, with a focus on more agentic, RL-centric training methods. But it's going to take a while for anyone to prove out an architecture sufficiently, train it at scale to be competitive with SOTA LLMs and perform enough post training, validation and red-teamint to be comfortable releasing to the public.
Current LLMs are years and hundreds of millions of dollars of training in. That's a very high bar for a new architecture, even if it significantly improves on LLMs.
This site and many others were littered with OpenAI stories calling it the next Bell Labs or Xerox PARC and other such nonsense going back to 2016.
And GPT stories kicked into high gear all over the web and TV in 2019 in the lead-up to GPT-2 when OpenAI was telling the world it was too dangerous to release.
Certainly by 2021 and early 2022, LLM AI was being reported on all over the place.
>For most of the world LLM's did not exist before those dates.
Just because people don't use something doesn't mean they don't know about it. Plenty of people were hearing about the existential threat of (LLM) AI long before ChatGPT. Fox News and CNN had stories on GPT-2 years before ChatGPT was even a thing. Exposure doesn't get much more mainstream than that.
No, it wasn't.
As a proxy, here's HN results prior to November, 2022 - 13 results.
https://hn.algolia.com/?dateEnd=1667260800&dateRange=custom&...
Here's Google Trends, showing a clear uptick May 2023, and basically no search volume before (the small increase Feb. 2023 probably Meta's Llama).
https://trends.google.com/trends/explore?date=today%205-y&ge...
https://trends.google.com/trends/explore?date=today%205-y&ge...
As another proxy, compare Nvidia revenues - $26.91bln in 2022, $26.97bln in 2023, $60bln 2024, $130bln 2025. I think it's clear the hype didn't start until 2023.
You're welcome to point out articles and stores before this time period "hyping" LLM's, but what I remember is that before ChatGPT there was very little conversation around LLM's.
Image generation was also a continuous slope of hype all the way from the original GAN, then thispersondoesnotexist, the sketch-to-photo toys by Nvidia and others, the avocado sofa of DallE. Then DallE2, etc.
The hype can continue to grow beyond our limit of perception. For people who follow such news their hype sensor can be maxed out earlier, and they don't see how ridiculously broadly it has spread in society now, because they didn't notice how niche it was before, even though it seemed to be "everywhere".
"It just suddenly appeared out of nowhere" is just a perception based on missing info. Many average people think ChatGPT was a sudden innovation specifically by OpenAI seemingly out of nowhere. Because they didn't follow it.
The more you know about it, the less groundbreaking it is.
Personally, deep research and o3 have been transformative, taking LLMs from something I have never used to something that I am using daily.
Even if the progress ends up plateauing (which I do not believe will happen in the near term), behaviors are changing; OpenAI is capturing users, and taking them from companies like Google. Google may be able to fight back and win - Gemini 2.5 Pro is great - but any company sitting this out risks being unable to capture users back from Open AI at a later date.
Why? I paid for Claude for a while, but with Deepseek, Gemini and the free hits on Mistral, ChatGPT, Claude and Perplexity I'm not sure why I would now. This is anecdotal of course, but I'm very rarely unique in my behaviour. I think the best the subscription companies can hope for is that their subscribers don't realize that Deepseek and Gemini can basically do all you need for free.
I cannot stress this enough: if you know what Deepseek, Claude, Mistral, and Perplexity are, you are not a typical consumer.
Arguably, if you have used a single one of those brands you are not a typical consumer.
The vast majority of people have used ChatGPT and nothing else, except maybe clicking on Gemini or Meta AI by accident.
They might not “know” the brand as well as ChatGPT, but the average consumer has definitely been exposed to those at the very least.
DeepSeek also made a lot of noise, to the point that, anecdotally, I’ve seen a lot of people outside of tech using it.
> taken it from a toy to genuinely insanely useful.
Really?
Why are you still pretending anything is going to come out of this?
If every major player had an AI option, i'm just not understanding how because OpenAi moved first or got big first, the hugely massively successful companies that did the same thing for multiple decades don't have the same advantage?
1. OpenAI is apparently in the process of building a social network.
2. OpenAI is apparently working with Jonny Ive on some sort of hardware.
3. OpenAI is increasingly working on "memory" as a LLM feature. Users may be less likely to switch as an LLM increasingly feels like a person that knows you, understands you, has a history with you, etc.
4. Google and MSFT are leveraging their existing strengths. Perhaps you will stick with Gemini given deep integration with Android, Google Drive, Sheets, Docs, etc.
5. LLMs, as depressing as this sounds, will increasingly be used for romantic/friend purposes. These users may not want to switch, as it would be like breaking up and finding a new partner.
6. Your chat history, if it can't be easily exported/imported, may be a sticky feature, especially if it can be improved (e.g. easily search, cross-reference, chats, like a supercharged interconnecting note app with brains).
I could list 100 more of these. Perhaps none of the above will happen, but again, they have 400M weekly users and they will find ways to keep them. It's a lot easier to keep users that have a habit of showing up, then getting them in the first place. There's a reason that Google is treating this like an emergency; they are at serious risk of having their search cash cow permanently disrupted if they don't act fast to win.
Google is alright, but they have similar stupid noncompete vendor lock in rule, and no way to opt out of training, so there’s no real reason to trust Google. Yeah they could ship tool use in reasoning to catch up to o3, but it’ll just be catching up and not passing unless they fix the stupid legal terms.
Claude IDK how to trust, they train on feedback and everything is feedback, and they have the noncompete rule written even more broadly, dumb to use that.
Grok has a noncompete rule but also has a way to opt out of training, so it’s on the same tier of ClosedAI. I use it sometimes for jokey toy image generation crap but there’s no way to use it for anything serious since it has a copypasted closed ai prohibition
Mistral needs better models and simpler legalese, it’s so complicated and impossible to know which of the million legal contracts applies
IMHO meta is the only player, but they shot themselves in the foot by making Llama 4 too big for the local llama community to even use, super dumb, killed their most valuable thing which was the community.
That means the best models we can use for work without needing to worry about a lawsuit, are Qwen, and DeepSeek distills, no American AI is even in the same ballpark, Gemma 3 is refusal king if you even hint at something controversial. basically, America is getting actively stomped by China in AI right now, because their stuff is open and interoperable, and ours is closed and has legal noncompete bullshit, what can we actually build that doesn’t compete with these companies? Nothing
#5 stands out as well as a substantial barrier.
The rest to me our sticky, but no more uniquely sticky than any other service that retains data. Like the switching cost of email or a browser. It does stick but not insurmountable and once the switch is made, it's like why did I wait so long? (I'm a Safari user!)
Anyway, thanks for the thoughtful reply.
[1] https://www.reforge.com/podcast/unsolicited-feedback/the-gre...
I'd say Chain-of-Thought has massively improved LLM output. Is that "incremental"? Why is that more incremental than the move from GPT-2 to GPT-3? Sure you can say that this is when LLMs first passed some sort of Turing test, but fundamentally there was no technological difference from GPT-3 to GPT-4. In fact I would say the quality of GPT-4 unlocked thousands (millions?) more use-cases that were not very viable with the quality delivered by GPT-3. I don't see any reason for more use-cases to keep being unlocked by LLM improvements.
1: https://www.techpolicy.press/transcript-senate-judiciary-sub...
There is little to no money to be made in GAI, it will never turn into AGI, and people like Altman know this, so now they’re looking for a greater fool before it is too late.
In this niche you can be irrellevant in months when your models drop behind.
The news that they did that would make them lose most of their revenue pretty fast.
OpenAI has claimed this. But Altman is a pathological liar. There are lots of ways of disguising operating costs as capital costs or R&D.
OpenAI models are already of the most expensive, they don’t have a lot of levers to pull.
It’s ok to not buy into the vision or think it’s impossible. But it’s a shallow dismissal to make the unnuanced comparison, especially when we’re talking about a brand new technology - who knows what the cost optimization levers are. Who knows what the market will bear after a few more revs.
When the iPhone first came out, it was too expensive, didn’t do enough, and many people thought it was a waste of apples time when they should be making music players.
This comparison is always used when people are trying to hype something. For every "iPhone" there are thousands of failures
> But it’s a shallow dismissal to make the unnuanced comparison, especially when we’re talking about a brand new technology - who knows what the cost optimization levers are. Who knows what the market will bear after a few more revs.
You're acting as-if OpenAI is still the only player in this space. OpenAI has plenty of competitors who can deliver similar models for cheaper. Gemini 2.5 is an excellent and affordable model and Google has a substantially better capacity to scale because of a multi-year investment in its TPUs.
Whatever first mover advantage OpenAI had has been quickly eliminated, they've lost a lot of their talent, and the chief hypothesis they used to attract the capital they've raised so far is utterly wrong. VCs would be mad to be continuing to pump money into OpenAI just to extend their runway -- at 5 Bln losses per year they need to actually consider cost, especially when their frontier releases are only marginal improvements over competitors.
... this is a bubble despite the promise of the technology and anyone paying attention can see it. For all of the dumb money employed in this space to make it out alive, we'll have to at least see a fairly strong form of AGI developed, and by that point the tech will be threatening the general economic stability of the US consumer.
Is that a bubble? I suppose it is; it’s also probably the right strategy.
I feel like people overuse this criticism. That's not the only way that companies with a lot of revenue lose money. And this isn't at all what OpenAI is doing, at least from their customers' perspective. It's not like customers are subscribing to ChatGPT simply because it gives them something they were going to buy anyway for cheaper.
Why does the forum of an incubator that now has a portfolio that is like 80% AI so routinely bearish on AI? Is it a fear of irrelevance?
Even five years into this "AI revolution," the boosters haven't been able to paint a coherent picture of what AI could reasonably deliver – and they've delivered even less.
The world is changing and that is scary.
This makes me want to invest in malpractice lawyers, not OpenAI
The other point is still suspect: that LLMs will ever scale to AGI.
Which specifically means reliability and explainability for higher-order thinking.
The writing is on the wall that LLMs are going to automate failure-tolerant work.
But the rub there is that failure-tolerant work is also tolerant of less than state of the art, cost-optimized LLMs.
Which leaves OpenAI where? AGI or bust.
And I wouldn't take that bet, when MS, Google, and Apple are alternative options.
I don't think there is serious argument that LLMs won't generate tremendous value. The question is who will capture it. PCs generated massive value. But other than a handful of manufacturers and designers (namely, Apple, HP, Lenovo, Dell and ASUS), most PC builders went bankrupt. And out of the value generated by PCs in the world, the vast majority was captured by other businesses and consumers.
Oh we know: https://pmc.ncbi.nlm.nih.gov/articles/PMC11006786/
The article could just as easily be about “Delayed diagnosis of a transient ischemic attack caused by talking to some rando on Reddit” and it would be just as (non) newsworthy.
AI isn't going to be the world changing, AGI, that was sold to the public. Instead, it will simply be another B2B SaaS product. Useful, for sure. Even profitable for startups.
But "take over the world" good? Unlikely.
OpenAI has been on a winning streak that makes ChatGPT the default chatbot for most of the planet.
Everybody else like you describe is trying to add some AI crap behind a button on a congested UI.
B2B market will stay open but OpenAI has certainly not peaked yet.
What network effect does OpenAI have? Far as I can tell, moving from OpenAI to Gemini or something else is easy. It’s not sticky at all. There’s no “my friends are primarily using OpenAI so I am too” or anything like that.
So again, I ask, what makes it sticky?
They have the brand recognition and consumer goodwill no other brand in AI has, incredibly so with school students, who will soon go into the professional world and bring that goodwill with them.
I think better models are enough to dethrone OpenAI in API, B2C and internal enterprise use cases, but OpenAI has consumer mindshare, and they're going to be the king of chatbots forever. Unless somebody else figures out something which is better by orders of magnitude and that Open AI can't copy quickly, it's going to stay that way.
Apple had the opportunity to do something really great here. With Siri's deep device integration on one hand and Apple's willingness to force 3rd-party devs to do the right thing for users on the other, they could have had a compelling product that nobody else could copy, but it seems like they're not willing to go that route, mostly for privacy, antitrust and internal competency reasons, in that order. Google is on the right track and might get something similar (although not as polished as typical Apple) done, but Android's mindshare among tech-savvy consumers isn't great enough for it to get traction.
...Until their employer forces them to use Microsoft Copilot, or Google Gemini, or whatever, because that's what they pay for and what integrates into their enterprise stack. And the new employee shrugs and accepts it.
...yes. Office is the market leader. Slack has between a fifth and a fourth of the market. Coca-Cola's products have like 70% market share in the American carbonated soft-drink market [1].
[1] https://www.investopedia.com/ask/answers/060415/how-much-glo...
My friend teaches at a Catholic girls’ high school and based on what he tells me, everyone knows about ChatGPT, both staff and students. He just had to fail an entire class on an assignment because they all used it to write a book summary (which many of them royally screwed up because there’s another book with a nearly identical title).
It’s all anecdotal and whatnot but I don’t think many of them even know about Claude or Gemini, while ChatGPT has broad adoption within education. (I’m far less clear on how much mindshare it has within the general population though)
This will happen, and it won't be another model which Open AI can't copy, it'll be products.
I don't doubt OpenA I can create the better models but they're no moat if they're not in better products. Right now the main product is chat, which is easy enough to build, but as integrations get deeper how can OpenAI actually ensure it keeps traffic?
Case in point, Siri. Apple allows you to use ChatGPT with Siri right now. If Apple chooses so, they could easily remove that setting. On most devices ChatGPT lives within the confines of an app or the browser. A phone with deep AI integration is arguably a fantastic product— much better than having to open an app and chat with a model. How quickly could Open AI build a phone that's as good as those of the big phone companies today?
To draw a parallel— Google Assistant has long been better than Siri, but to use Siri you don't have to install an app. I've used both Android and iOS, and every time I'm on iPhone I switch back to Siri because in spite of being a worse assistant, it's overall a better product. It integrates well with the rest of the phone, because Apple has chosen to not allow any other voice assistant integrate deeply with the rest of the phone.
So the interesting question is: How did that happen? Why wasn't Google search an easily swapped commodity? Or if it was, how did they win and defend their default status? Why didn't the existing juggernauts at the time (Microsoft) beat them at this game?
I have my own answers for these, and I'm sure all the smart people figuring out strategy at Open AI have thought about similar things.
It's not clear if Open AI will be able to overcome this commodification issue (personally, I think they won't), but I don't think it's impossible, and there is prior art for at least some of the pages in this playbook.
Google is doing well for the moment, but OpenAI just closed a $40 billion round. Neither will be able to rest for a while.
Maybe the big amount of money they've given to Apple which is their direct competitor in the mobile space. Also good amount of money given to Firefox, which is their direct competitor in the browser space, alongside side Safari from Apple.
Most people don't care about the search engine. The default is what they will used unless said default is bad.
So then apply that to Open AI. What are the distribution channels? Should they be paying Cursor to make them the default model? Or who else? Would that work? If not, why not? What's different?
My intuition is that this wouldn't work for them. I think if this "pay to be default" strategy works for someone, it will be one of their deeper pocketed rivals.
But I also don't think this was the only reason Google won search. In my memory, those deals to pay to be the default came fairly long after they had successfully built the brand image as the best search engine. That's how they had the cash to afford to pay for this.
A couple years ago, I thought it seemed likely that Open AI would win the market in that way, by being known as the clear best model. But that seems pretty unclear now! There are a few different models that are pretty similarly capable at this point.
Essentially, I think the reason Google was able to win search whereas the prospects look less obvious for Open AI is that they just have stronger competition!
To me, it just highlights the extent to which the big players at the time of Google's rise - Microsoft, Yahoo, ... Oracle maybe? - really dropped the ball on putting up strong competition. (Or conversely, Google was just further ahead of its time.)
At best they have a bit of cheap tribalism that might prevent some incurious people who don't care much about using the best tools noticing that they aren't.
Facebook wasn't some startup when Google+ entered the scene; they were already cash flow positive, and had roughly 30% ads market share.
OpenAI is still operating at a loss despite having 50+% of the chatbot "market". There is no easy path to victory for them here.
If you look at Gemini, I know people using it daily.
My impression is that Claude is a lot more popular – and it’s the one I use myself, though as someone else said the vast majority of people, even in software engineering, don’t use AI often at all.
For example, I'd never suggest that e.g. MS could take on TikTok, despite all the levers they can pull, and being worth magnitudes more. No chance.
This moat is non-existent when it comes to Open AI.
All dissidents went into Little Wadyia.
When the Dictator himself visited it, he started to fake his name by copying the signs and names he saw on the walls. Everyone knew what he was.
Internet social networks are like that.
Now, this moat thing. That's hilarious.
And nobody's saying OpenAI will go bankrupt, they'll certainly continue to be a huge player in this space. But their astronomical valuation was based on the initial impression that they were the only game in town, and it will come down now that that's no longer true. Hence why Altman wants to cash out ASAP.
OpenAI has like 10 to 20% market share [1][2]. They're also an American company whose CEO got on stage with an increasingly-hated world leader. There is no universe in which they keep equal access to the world's largest economies.
[1] https://iot-analytics.com/leading-generative-ai-companies/
[2] https://www.enterpriseappstoday.com/stats/openai-statistics....
LLMs themselves aren't the moat, product integration is. Google, Apple and Microsoft already have the huge user bases and platforms with a big surface area covering a good chunk of our daily life, that's why I think they're better positioned if models become a commodity. OpenAI has the lead now, but distribution is way more powerful in the long run.
The names don't even matter when everything is baked in.
The fact that people know Coca Cola doesnt mean they drink it.
That name recognition made Coca Cola into a very successful global corporation.
Knowing and using are not the same thing.
40% of the US is a huge customer base.
Slack? Zoom? Teams?
I'm sure you'd get a somewhat uniform distribution.
Ask the same today, and I'd bet most will say Teams. Why Teams? Because it comes with office / windows, so that's what most people will use.
Same logic goes for the AI / language models...which one are people going to use? The ones that are provided as "batteries included" in whatever software or platform they use the most. And for the vast majority of regular people / workers, it is going to be something by microsoft / google / whatever.
I guess Gemini just refused because of a poor filter for sensitive content. But still, it was annoying.
The only thing OpenAI has right now is the ChatGPT name, which has become THE word for modern LLMs among lay people.
Anecdotally, I've switched to Gemini as my daily driver for complex coding tasks. I prefer Claude's cleaner code, but it is less capable at difficult problems, and Anthropic's servers are unreliable.
Market share of OpenAI is like 90%+.
Source? I've seen 10 to 20% [1][2].
[1] https://iot-analytics.com/leading-generative-ai-companies/
[2] https://www.enterpriseappstoday.com/stats/openai-statistics....
I probably need to clarify what I'm talking about, so that peeps like @JumpCrisscross can get a better grasp of it.
I do not mean the total market share of the category of businesses that could be labeled as "AI companies", like Microsoft or NVIDIA, on your first link.
I will not talk about your second link because it does not seem to make sense within the context of this conversation (zero mentions or references to market share).
What I mean is:
* The main product that OpenAI sells is AI models (GPT-4o, etc...)
* OpenAI does not make hardware. OpenAI is not in the business of cloud infrastructure. OpenAI is not in the business of selling smartphones. A comparison between OpenAI and any of those companies would only make sense for someone with a very casual understanding of this topic. I can think of someone, perhaps, who only used ChatGPT a couple times and inferred it was made by Apple because it was there on its phone. This discussion calls for a deeper understanding of what OpenAI is.
* Other examples of companies that sell their own AI models, and thus compete directly with OpenAI in the same market that OpenAI operates by taking a look at their products and services, are Anthropic (w/ Claude), Google (w/ Gemini) and some others ones like Meta and Mistral with open models.
* All those companies/models, together, make up some market that you can put any name you want to it (The AI Model Market TM)
That is the market I'm talking about, and that is the one that I estimated to be 90%+ which was pretty much on point, as usual :).
1: https://gs.statcounter.com/ai-chatbot-market-share
2: https://www.ctol.digital/news/latest-llm-market-share-mar-20...
Your second source doesn’t say what it’s measuring and disclaims itself as from its “‘experimental era’ — a beautiful mess of enthusiasm, caffeine, and user-submitted chaos.” Your first link only measures chatbots.
ChatGPT is a chatbot. OpenAI sells AI models, including via ChatGPT. Among chatbots, sure, 84% per your source. (Not “90%+,” as you stated.) But OpenAI makes more than chatbots, and in the broader AI model market, its lead is far from 80+ percent.
TL; DR It is entirely wrong to say the “market share of OpenAI is like 90%+.”
[1] https://firstpagesage.com/reports/top-generative-ai-chatbots...
>10%-20%
Lmao, not even in Puchal wildest dreams.
One, you suggested OP had not “looked at the actual numbers.” That implies you have. If you were just guessing, that’s misleading.
Two, you misquoted (and perhaps misunderstand) a statistic that doesn’t match your claim. Even in your last comment, you defined the market as “companies that sell their own AI models” before doubling down on the chatbot-only figure.
> not even in Puchal wildest dreams
Okay, so what’s your source? Because so far you’ve put forward two sources, a retracted one and one that measures a single product that you went ahead and misquoted.
OpenAI trained GPT-4.1 and 4.5—both originally intended to be GPT-5 but they were considered disappointments, which is why they were named differently. Did they really believe that scaling the number of parameters would continue indefinitely without diminishing returns? Not only is there no moat, but there's also no reasonable path forward with this architecture for an actual breakthrough.
If the entrenched giants (Google, Microsoft and Apple) catch up - and Google 100% has, if not surpassed - they have a thousand levers to pull and OpenAI is done for. Microsoft has realized this, hence why they're breaking up with them - Google and Anthropic have shown they don't need OpenAI. Galaxy phones will get a Gemini button, Chrome will get it built into the browser. MS can either develop their own thing , use opensource models, or just ask every frontier model provider (and there's already 3-4 as we speak) how cheaply they're willing to deliver. Then chuck it right in the OS and Office first-class. Which half the white collar world spends their entire day staring at. Apple devices too will get an AI button (or gesture, given it's Apple) and just like MS they'll do it inhouse or have the providers bid against each other.
The only way OpenAI David was ever going to beat the Goliaths GMA in the long run was if it were near-impossible to catch up to them, á la TSMC/ASML. But they did catch up.