Yes; and trying to justify their own valuation by pointing out that Deepseek cost more than advertised to create if you count in the cost of creating OpenAI's model.
Though I also think it’s extremely bad for OpenAI’s valuation.
If you give me $500B to train the best model in the world, and then a couple people at a hedge fund in China can use my API to train a model that’s almost equal for a tiny fraction of what I paid, then it appears to be outrageously foolish to build new frontier models.
The only financial move that makes sense is to wait for someone else to burn hundreds of billions building a better model, and then clone it. OpenAI primarily exists to do one of the most foolish things you can possibly do with money. Seems like a really bad deal for investors.
It still doesn’t justify their valuation because it shows that their product is unprotectable.
In fact, I’d argue this is even worse, because no matter how much OpenAI improves their product, and Altman is prancing around claiming to need $7Trillion to improve their product, someone else can replicate it for a few million.
It still doesn’t justify their valuation because it shows that their product is unprotectable.
First-mover advantage doesn't always have to pay off in the marketplace. FedEx probably has to schedule extra flights between SF and DC just to haul all of OpenAI's patent applications.
I suspect that it's going to end up like the early days of radio, when everybody had to license dozens of key patents from RCA ( https://reason.com/2020/08/05/how-the-government-created-rca... ). For the same reason, Microsoft is reputed to make more money from Android licenses than Google does.
