And there was never any question as to how social media would make money, everyone knew it would be ads. LLMs can’t do ads without compromising the product.
But inference? Inference is dirt cheap and keeps getting cheaper. You can run models lagging 6-12 years on consumer hardware, and by this I don't mean absolutely top-shelf specs, but more of "oh cool, turns out the {upper-range gaming GPU/Apple Silicon machine} I bought a year ago is actually great at running local {image generation/LLM inference}!" level. This is not to say you'll be able to run o3 or Opus 4 on a laptop next year - larger and more powerful models obviously require more hardware resources. But this should anchor expectations a bit.
We're measuring inference costs in multiples of gaming GPUs, so it's not an impending ecological disaster as some would like the world to believe - especially after accounting for data centers being significantly more efficient at this, with specialized hardware, near-100% utilization, countless of optimization hacks (including some underhanded ones).
Spoiler: they are still going to do ads, their hand will be forced.
Sooner or later, investors are going to demand returns on the massive investments, and turn off the money faucet. There'll be consolidation, wind-downs and ads everywhere.
The Meta app Threads had no ads for the first year, and it was wonderful. Now it does, and its attractiveness was only reduced by 1% at most. Meta is really good at knowing the balance for how much to degrade UX by having monetization. And the amount they put in is hyper profitable.
So let's see Gemini and GPT with 1% of response content being sponsored. I doubt we'll see a user exodus and if that's enough to sustain the business, we're all good.
It depends on what you mean by "compromise" here but they sure can inject ads.. like make the user wait 5 seconds, show an ad, then reply..
They can delay the response times and promote "premium" plans, etc
Lots of ways to monetize, I suppose the question is: will users tolerate it?
Based on what I've seen, the answer is yes, people will tolerate anything as long as it's "free".
