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Things are starting to change a bit in frontier model land in two, intermingled ways.
Way #1:
For months, it seemed as though clients were entirely ok with singularly relying on leading closed-source models from one of a few vendors. They were fine with paying hefty token fees to consume more model intelligence, and not all that worried about AI research labs potentially obtaining lucrative and proprietary data in the meantime. We saw exactly what this could mean for large enterprise software firms when Anthropic decided to reveal a Figma copy-cat. This was days after Anthropic’s Chief Product Officer left Figma’s board in a move that signaled an unwelcome movement in competitive boundaries. Whether it was this or just ongoing and general anxiety about AI companies venturing further into enterprise software use cases via agents, there seems to be a sea change happening. Companies are no longer unconditionally eager to effectively pay model companies to consume their LLMs while signing over the rights to their data… AKA… the thing that creates their moat). They’re no longer mysteriously happy to openly share data with the model companies that have shown they’re perfectly willing to disrupt partners and compete directly with their own customers.
And this is all coinciding with rising popularity of open source models from Nvidia and many others across North America and China. DoorDash executive Andy Fang took to X to announce they’ve been able to shift AI coding to more of an open source foundation with zero quality issues. Meta also leaned on open source models as a foundation to build on for its image generation model announced yesterday. Again, this allowed it to reduce reliance on expensive, competing closed-source models. There are real alternatives emerging, with more compelling examples such as Nvidia and Palantir joining forces to combine best-in-class open source models with best-in-class data infrastructure and software. ServiceNow and many other software platforms have also worked hard to add leading open models from Nvidia and others in recent months too.