r/stocks
Anthropic has literally no moat without AGI.
Anthropic lacks a moat without AGI; faces high costs, low product stickiness, and cheap Chinese competition, leading to poor margins.
- Claude Code lacks data gravity and switchability makes it vulnerable to cheaper alternatives like Cursor or Devin.
- High infrastructure costs (electricity/data centers) in the US prevent competitive pricing against lower-cost Chinese models.
- Failure to achieve AGI will result in plateauing revenue while capital expenditures remain high, crushing margins.
The whole company's premise is a gamble on AGI.
Claude Code is not sticky at all, it can be easily swapped out for Codex, Cursor, Opencode or Devin. for a fraction of the price. It doesn't have the stickiness of traditional SAAS because it has no data gravity.
Opus is great but other coding models are always on the back foot. Chinese Coding Models are arguably close to the same level at a fraction of the cost because Anthropic is held back by electricity and data centre costs.
The Chinese are too, but they pay physical labour and electricity costs are substantially lower, so they can continually undercut without issues on the global market. The only things that grants them the edge right now is enterprise customers are unlikely to use chinese models (but that's not stopping small-mid size companies).
Therefore their only shot at redemption is AGI. If there are not getting to AGI, then their revenue growth will plateau but they are forced to continually re-invest in data centers, electricity and chips to remain competitive. Therefore their margins will be terrible.
They know this too, so they are desperately scrambling to enter new stickier product categories like Design and Finance but I don't think it's taking (unless something can tell me it is).
It's the water footprint so it accounts for everything.
The idea is that your fraud detection software will now be able to turn transaction data into a paragraph that's readable by humans with the main points summarised. They can also convert text instructions into commands.
Whether you want it call ML or AI with LLM is up to you. It's all just different kinds of statistical analysis on different datasets at the end of the day.
From my work on these systems for credit cards, they use incredibly complex queries to create a probability that the transaction is fraud so I'm not sure why a human needs to read a paragraph. It's all automated already.
Improvements in chatbots/LLMs and their capabilities to infer is nowhere near the road to achieving AGI
Companies with 500 devs all using 10k a month will not switch anything. They get offered enterprise level plans that offer much better discounts than you switching to anything readily available by locking you in for a year or more contracts.
Good for Anthropic for 12-24 months then. But when the contract is up, the competition from vendors for the next contract will be fierce. Commoditized LLMs will be a race to the bottom.
You only spend “more time cleaning up” if you’re really bad at using the tools.
The speed increase is ridiculous, let’s say 10x at least.
The only moat in AI is accepting there is no moat or lobbying the government to give you a monopoly to "protect" the public from AI
You missed some things:
- Claude code is a vibecoded harness that they made open source willingly or accidentally.
- Deepseek is not cheaper due to energy. It's a distilled model from ChatGPT/Claude output. The latter spend billions in training, RLHF, alignment, data curation, just to have it stolen through their own APIs. And they can't stop it. Deepseek will ALAWAYS be cheaper.
- Claude will never reach AGI because it has no world model. It cannot replicate human behavior entirely. The proof is that if it could replicate entire SaaSes, do medical research, etc. , Claude will have an Applied sciences sector/sister company that makes this shit. They don't. Because it can't. It's like a gold prospection company selling a device that locates gold instead of just finding the gold.
This is a dumb take. AGI is not needed for AI to be valuable. I pay $200 a month, that literally defines value. No other subscription in the world can demand that price tag.
That's probably bc your using grok
I think most rational thinking people understand it. The problem is this sub is filled with adolescents and young adults who have a natural bias to be disagreeable
But we had that already, that's how it worked before all this
I believe some companies in USA already use Chinese open source models like deepseek. Maybe not big tech, but definitely some tech companies
If you did 100 years of work, show me your new Linux kernel competitor.
Not an expert, but here's my understanding.
First, current AI is not really AI. They are called LLMs. They don't think at all. What they do is basically predict the next token. You can think of tokens as letters.
To make it slightly easier to understand, let's use words instead of letters to complete. If I asked you to complete this sentence: "I love my..." what word would you pick? The reality is you would pick different words at different times and different people would pick different words due to their circumstances. Some common words that fit are "spouse", "child", "parent", "pet", "car", "phone", "school", etc.
The crucial thing here is - there's no "right" answer. It depends and can vary greatly depending on the context. The problem is you do not have the whole context if you were just given the above sentence. For example, people without children will never pick "children", but when you talk to LLMs you don't give them enough information to know that.
LLMs cannot fix the flaws because they don't know what the right end result is. They just guess the best they can based on what you told them so far. If you knew that they would pick incorrectly, you would have told them, but you don't know what they would pick in advance. Among other things, their answers are somewhat randomized - this is done so when you ask them the same thing, they don't always produce the exact same answer,which would be very unlike us humans and thus feel very artificial. Ironically, we want our artificial intelligence to not feel artificial :)
Got it, so then it would be using about 1/5th of the world's water?
harnesses not models.
claude code, codex, cursor,
What Anthropic/OpenAI etc provide now are remote LLM models, where they run in the data centre somewhere and you get billed for access. There are also lightweight & open models that you can run on your own computer, where the only cost is your RAM and local energy. Right now they are very limited, but progressing quickly (while the frontier models are hitting limits).
Once the open coding models that you can run locally are good enough that enterprise doesn't need to pay Antropic a bajillion dollars for tokens, they will switch en-masse.
Think about what that means. Humans score perfect on ARC-AGI-2 and LLMs struggle. So they trained the models specifically to perform well on ARC-AGI-2. People like you are fooled into believing that "it's really thinking now."
The next test comes out and once again, humans with no special training are able to get 100% and LLMs struggle. They might be able to train it specifically to win, but then version 5 will come out, ad infinitum. It's never thinking, it's just getting trained for the test.
And guess what? Real life is a series of tasks humans have never seen in exactly that format before but nonetheless are able to complete flawlessly. A new game, a new mechanism to operate...
Why do yall think AGI is so unlikely? Most people at the leading labs are estimating it will be here by 2030