No one falls in love with ink and paper. They fall in love with the world those pages open.
Tech is the same.
People never buy software. They buy more customers, higher profits, less work, more free time, or fewer headaches.
I am old and was around for Sun's demise. Aravind's reasoning is 100% true. Sun sold web servers that cost a million dollars each, with expensive services wrapped around them. They could do incredible things small Linux servers could not. For example, you could hot swap cards out of a Sun server WHILE it was running.
But a fully loaded Linux web server cost maybe $10,000, so you could buy ten and still save 90%. People rushed for the cheap Linux boxes. Sun tried to adapt, but the whole org was built around million-dollar servers. They just couldn't change. This all happened very quickly, about two years if I recall correctly.
Lots of parallels to expensive cloud AI and local AI. If Kimi K3 ships open weights as promised, you could run it on a couple of future Mac M5 or M6 or M7 systems (whatever ends up shipping) for maybe $50,000.
And local AI is the worst it will ever be today. Think where it is in two years. I don't think Fable 5 at $50/MTok output is sustainable.
At its peak, Sun Microsystems was valued at 205B (394B if inflation adjusted). Sold software in enterprise servers. Got disrupted by Linux, x86, and commodity hardware. Ended up selling to Oracle for 7.4B, losing 96% of its value.
Open source models running on local hardware can have a similar impact given what’s going on.
“Most businesses don’t have a traffic problem.
They have an economics problem.
If one company can profitably spend $500 to acquire a customer while you can only spend $100, eventually they’ll own the market.”-Dan Kennedy
@venturetwins@thinkymachines See https://t.co/rGceE2nlmU It lets you find the exact moment anyone said something across videos, podcasts, and books.
It connects ideas you'd likely never find yourself: who disagrees, where the same strategy appears in different fields, and every perspective on a topic.