Welcome to the Deluge (Issue #1)

The downstream impact of the war against LLMs

In March of this year, Elon’s Twitter announced a new pricing structure for its API, which basically eliminated the feasibility of many of its use cases. Masquerading as a “war on bots”, the actual war was brought right to the doorstep of independent, hobbyist, and other low-income developers looking to build legitimate apps on the API.

Despite a lot of really high-quality ragememes, months later the tiers still have not budged.

So about this war on bots… I dug into the pricing structure and it doesn’t add up. The lower cost option heavily punishes reads (3k), like a simple custom UI app might utilize, but still allows for a relatively massive number of tweets to still be posted (50k). Almost the exact opposite of what you’d expect for the $100 tier. A reasonably skilled scammer could scrape their way through enough content to utilize those 50k posts and fully fund it by ripping off only one or two grandmas a month.

So if this wasn’t entirely a war on bots, what was it?

The bad blood that had been building between OpenAI and Elon was hitting critical mass as ChatGPT became the fastest growing software product of all time, hitting over 100 million active users a month earlier this year. There is a deep history between the two, with Elon being one of its early donors (purported @ $50m) while it was still an open source concept.

It’s simple to connect the dots from here.

Drip by drip, tensions continued to escalate publicly as Elon took every opportunity to directly instigate OpenAI and Microsoft (the current controlling entity of OpenAI), while boasting the abilities of Tesla’s AI.

Make no mistake – this move wasn’t about protecting a war on scammers – although it’s a convenient narrative. This is about preventing high-volume reads of potential training set data – specifically that which could be used in competitive interest to that of Tesla/X.

Even at the $42,000/mo limit, developers could only expect to read 0.2% of the fresh monthly tweet content. Do you realize how many grandmas one would have to rip off to just break even?

But this segment isn’t really about Twitter, Elon, or his war on other people’s AI. This is about a new standard that’s being set on social media platforms and its API access.

This week Reddit joined the party when the developer of Apollo – a beloved Reddit User Experience app – publicly discussed his call with Reddit’s team about their new pricing structure. With a user base of over 1.5 billion/month, Reddit is another platform that would be hugely valuable to a LLM trainer looking for niche interests, public sentiment, and the gestalt of internet culture.

According to his post, Reddit would be expecting a payment of over $20 million per year to serve the content of the app, which averages 344 calls per-day per-user. This move renders the future of the app, which costs its users $50 for a lifetime of its Ultra features, entirely untenable.

While on the surface, this too seems like a business move aimed at capturing value from its database, it is one that makes no sense after peeling it back a few layers. Reddit’s product is 100% attention and engagement. Any loss of engagement from eliminating Apollo’s viability is a direct loss to Reddit’s top line. It knows that Apollo can’t pay the exorbitant fees, which sounds like a net loss for everyone.

With Reddit considering its IPO later this year, we should get a peek into the real motivations behind these changes soon. If I had a guess, they know the value of their data and can’t extort LLMs without first closing off access, despite the casualties that may be incurred.

In the current: Kids, don’t build an app on someone else’s platform if it’s your sole source of income.

For Your Consideration

This week I ran into the quote “self-sufficiency is the road to poverty”, presumably coined by American economist Russ Roberts.

The idea is that it is not meritorious to invest in being well-rounded for the sake of well-roundedness itself. In our current evolution of society, we must depend on each other – not only have access to the excellence of others, but also have the focus to offer that same excellence in kind.

I struggled with this one a bit as someone who loves to play a dilettante.

Links and whatnot

• Tether recovers all lost value

• OpenAI's plans according to Sam Altman

• Amazon employees stage walkout over return-to-office mandate

• Pi – your interesting and creepy AI buddy

Reaction of the Week

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