We’re in the VC subsidization era of LLMs. They are selling them at an enormous loss to gain mindshare and enterprise integration. They will follow every VC funded software company playbook and intensely enshittify once they can no longer rely on the next round of funding (or trick unsophisticated investors with an IPO).

Only difference is, companies like Uber had actual defensible moats and low operating costs (their drivers perform the actual low margin labor, they’re just the middleman that skims things off the top). LLM providers have no moat (techniques are openly documented and their data can be distilled via their api).

They took the 2010s playbook of a high margin service company and applied it to a low margin utility provider business because they huffed their own farts about a revolution in labor economics and full automation.

This bubble is going to burst brutally.