Where is the moat? There is no cost of switching. Anyone or any company can bounce between AI with minimal cost of switching. So unless they find a way to compelling or way to keep users beyond, “our model is the best” user acquisition isn’t going to matter a whole lot.

The important point is that all competitors are in the same position, they’re all on equal footing and face the same costs for training frontier models. The major players do have advantages from their infrastructure buildout and the deals they’ve negotiated with enterprise businesses which partly shuts out small competitors. It’s also yet to be determined whether smaller competitors can actually surpass the big labs in capability or whether the degree to which they depend on synthetic data generated using frontier models puts a hard limit on how far they can improve. The market is unique, it requires huge infrastructure but can also grow through investment in research and also easy to duplicate the latest advancements. It’s also not constrained by location so it can’t be easily understood as something like railroad infrastructure or power utilities. The biggest factor is growing demand, there’s more than they can all supply together and it seems likely to keep growing as more tasks can be automated.