How is Anthropic, OpenAI and xAi going to compete against the likes of Google that can spend $200 billion a year? It’s an impossible war and all these investors are throwing their money into a bottomless insatiable pit of money.<p>Until the funding stops for one reason or another and then everyone loses all their money at once like a star that collapses into a black hole singularity in a femtosecond.
As someone who thought Google+ doomed facebook, because of Gmail accounts and everyone with Google as their homepage already, I learned not to overestimate Google’s abilities.
Theoretically Apple can spend just as much. What are the outcomes though? All those giants have their own business that are established and profitable.<p>It’s the new kids in the block that will make the difference.<p>You know those lists on twitter about how many companies US has in top 10 and are presented as a win? Those are actually lists of capital concentrations blocking innovation. It looks like US is winning but for some reason life is better in EU and innovation is faster in China.<p>It’s companies like OpenAI Anthropic that will move US ahead. Even if some core innovation or and capital comes from the establishment.
> Theoretically Apple can spend just as much. What are the outcomes though?<p>The GP was talking about Google specifically, and their outcomes on AI are nothing to scoff at. They had a rocky late start, but they seem to have gotten over that. Their models are now very much competitive with the startups. And it's not just that have more money to spend. They probably have more training data than anyone in the world, and they also have more infrastructure, more manpower, more of a global footprint than the startups.<p>The Innovator's Dilemma is an anecdotal, maybe a statistical relationship at best, but not a fundamental law of nature. When an established company has everything it should take to become a leader in a new industry in theory, and in practice their products are already on par with the industry leaders, you know at some point it becomes rational to think that maybe they might become a leader.
Sometimes I worry about the incentives for innovation in the US.<p>Step 1, find something to innovate on, sell the promise of it to investors.
Step 2, build a prototype or worst case, build it for real and start generating income from your truly innovate and unique product.
Step 3, get acquired by a large company and then shut down because your product competed with theirs.<p>End result, general public possibly benefited from your innovation, but in the long run, it was temporary.<p>Maybe the incentives would be better if it were harder for large companies to acquire small ones? If the path to riches where driven primarily by delivering value to customers. Would love to hear other's opinions on this.
> What are the outcomes though?<p>NVIDIA, and contractors who build data centers, and manufacturers who supply them, will all get rich.
The new kids have an easier time focusing. the big kids can integrate AI with their existing products and user data<p>In the long term, big kids win no? The big kids are also going to have an easier time with hardware at scale too
>It looks like US is winning but for some reason life is better in EU and innovation is faster in China<p>As measured by prosperity life in the US is better; the poorest US state has a higher GDP per capita than most western European countries. Americans have bigger houses, more food, bigger cars, bigger salaries, and access to better medical care and schools if they've got an okay job. Most Europeans are lucky to make $40k/year post-tax. And America is still winning on innovation because its AI models are ahead of China's both in benchmarks and in user preferences. How many people do you know professionally who use a Chinese model and agent framework instead of e.g. Claude Code or OpenAI Codex?
It's telling that the measure of quality of life you use in this comment is entirely materialistic in nature. I also challenge the idea that US provides 'access to better medical care', as it is pretty well documented that Americans spend more for lower quality care compared to similar developed countries.<p>I believe this cultural divide is a big reason America won't make it back to the top - insatiable desire for wealth and a lack of values-based principals. Ironically US companies are the first to tout their 'values' in the workplace.
> I believe this cultural divide is a big reason America won't make it back to the top<p>What top are you referring to?<p>We're in a thread about a US company announcing its new $30B fundraise from a group of elite US growth investment funds arguing about whether this company will be able to overthrow the $4T US tech behemoth and suggesting that all the other US tech behemoths are actually stifling progress.
If you are in the bottom 30% of earners, the EU is better.<p>If you are in the top 30% of earners, the US is better.
> bigger cars<p>I gotta say, I found this one especially funny as I currently don't have a car and that's actually my biggest luxury: being able to go around without one and no spending time in commute.
> more food<p>Yeah, so I don't want to be a Debbie Downer, but as a European who visited the US, your food is definitely not something I would use as an example of your QoL.
To your last point, the answer is probably much different in China
I have a friend who needs a medication that costs more than 30,000$ a year. Here in Canada it is 100% covered by our government health insurance regime. In the USA he would be bankrupt (or dead).<p>Here in Canada if I have an accident i do not have to worry about being bankrupt if the ambulance brings me to the wrong hospital.<p>I am really not enthusiastic about the so-called superior quality of life some US-ians like to boast about.
> In the USA he would be bankrupt (or dead)<p>Why? I live in the US. I have the best healthcare coverage in the world. I pay absolutely nothing for it, ever. No matter the cost. And I have access tot he best doctors, innovations, and technology in the world.<p>Tell me again why your friend would be dead? It sounds like you really have a poor understanding of American health care.
>As measured by prosperity life in the US is better; the poorest US state has a higher GDP per capita than most western European countries.<p>GDP per capita/prosperity is a poor proxy for quality of life. The US is lagging most of the developed world in most quality of life metrics, even as reported by US news outlets, which don't rank the US in even the top 20: <a href="https://www.usnews.com/news/best-countries/rankings/quality-of-life" rel="nofollow">https://www.usnews.com/news/best-countries/rankings/quality-...</a><p>>Americans have bigger houses, more food, bigger cars,<p>The size of one's house or car is <i>at best</i> weakly-correlated with quality of life. I would rather not own a car at all and be able to walk everywhere, rather than spend hours of my life commuting in a gigantic SUV.<p>>bigger salaries, and access to better medical care and schools if they've got an okay job.<p>The US ranks the lowest in the developed world for life expectancy, and among the highest in obesity globally (obesity being a major determinant of health). The US remains the only developed country where an unlucky dice roll (e.g. genetic-linked cancer) will bankrupt you and destroy the livelihoods of your children.<p>This is not the flex you think it is.
Keep in mind there are two Americas, a wealthy one and a not wealthy one; someone posting on HN is likely in the former bucket, and not juggling a retail job and doing Uber on the side while being unable to afford healthcare.
"but for some reason life is better in EU" citation needed
Because it's Google they can't build products and they only care about benchmarking.<p>The product they released so far are all half assed experiments.<p>Gemini 3 Pro is now being beaten by open source models because they can't fix or don't want to fix the problems with the Gemini models being completely useless.<p>The same for Microsoft.<p>Microsoft had GitHub Copilot, and Microsoft Copilot and both of them are useless to Claude Code and Claude Cowork.<p>You can have all the money in the world, but nothing is stopping you from building useless garbage.
I'm trying paid tier Gemini and it doesn't allow to keep have personal chat history when you disable training on your data, on reload of the page your chat is gone. Even free tier of ChatGPT allows disabling training on your data while allowing to keep such basic functionality.<p>Some technical advancements are not worth it if you do not respect your users.
Yeah I’m never using a Google product. The sole purpose of their company is to be evil. At least other companies are indifferent.
Google is evil in passive way, like sprawling bureaucracy making you life slowly worse and worse but also doing some stuff to at least some fraction of population. OpenAI and Sam are determined and energetic evil, laser focused on making whole human population jobless and homeless in shortest way possible and not producing anything else of value, no other products. I'd rather prefer the former evil out of the two.
How does their top tier subscription compare in usage limits to the $200/mo Claude usage limits?
Another basic feature that’s missing is sharing a Gemini chat as a link anyone can view.<p>OpenAI figured this out: it’s awesome marketing when people send each other links to the app with a convenient text box to continue the conversation. It’s viral.<p>Google meanwhile set this up so that “anyone with the link can view” is <i>actually</i> “anyone with the link <i>and</i> a Google account”.<p>That’s grade A failure of marketing.<p>The PM in charge of that decision ought to be walked off a plank.
Google fucks up 90% of their products, why do you think Gemini is in the 10%?
Google has barely released a successful product in 20 years.
Depend on the definition of the "product". For example some banal cloud storage in which everyone competes. And it's an "old" product, despite being invisibly improved behind the scenes, just like at any other provider. Google has pretty competitive storage AND they are fully abusing Android integration for AND they have pretty good bundling of that storage with other products, including, you've guessed it - LLM Gemini. So say a person is not a professional user of LLMs like a developer burning tokens in a dozen accounts simultaneously. A person has a phone and eventually memory runs out, so he buys a one click Google storage for 4 bucks. And suddenly he has Gemini Pro included too. So why pay 20 bucks to Anthropic, when Google costs 1/5 of that AND has other stuff bundled too?<p>So maybe Google is lagging on truly new products (btw, does Gemini itself with its TPUs count as a new product? I'd say yes), but "old" products are entrenched enough to carry them and compete.
Google Cloud is good and successful. Except they can't implement billing hard caps, or pretend they can't.
Google is good at buying existing products and scaling them, which is exactly what they did with DeepMind.
I thought that the likes of Android, Google Docs, Google Translate, etc. were fairly successful. Chrome and ChromeOS also seem fairly popular too.
well, it's basically existential, so the incentive is there to not only get it very right but also to limit the delta with how right anyone else gets it. The same can't really be said of the long tail of products Google have done.<p>Look to GCP as an example. It had to be done, with similar competitive dynamics, it was done very well.<p>Look to Android as another.
> well, it's basically existential, so the incentive is there to not only get it very right but also to limit the delta with how right anyone else gets it. The same can't really be said of the long tail of products Google have done.<p>I've yet to see anything that threatens Google's ad monopoly.
I mean I guess this is classic disruption theory.<p>It's not that a dominant position goes away overnight. In fact that would be precisely the impetus to spur the incumbent to pivot immediately and have a much better chance of winning in the new paradigm.<p>It's that it, with some probability, gets eaten away slowly and the incumbent therefore cannot let go of the old paradigm, eventually losing their dominance over some period of years.<p>So nobody really knows how LLMs will change the search paradigm and the ads business models downstream of that, we're seeing that worked out in real time right now, but it's definitely high enough probability that Google see it and (crucially) have the shareholder mandate to act on it.<p>That's the existential threat and they're navigating it pretty well so far. The strategy seems balanced, measured, and correct. As the situation evolves I think they have every chance of actually not being disrupted should it come to that.
Because Google has the money to build 10 different versions/iterations of Gemini and can essentially force one to work. They have most people's data and most people use them for mail/search/browser/maps as well.<p>In my opinion though this is a race to the bottom rather than a winner takes all situation so I don't think anyone is coming out ahead once the dust settles.
Google built ten different chat products, how did that go?
This was the same argument made for Google Wave and Google+ and both completely tanked
The tech behind wave eventually made its way into Google docs though and pioneered collaborative document editing, so wasn't a complete failure even though the product itself was killed.<p>No comment on Google+, Google has a storied history of failure on any kind of social media/chat type products.<p>Where Google wins is just simply having enough money to outlive anyone else. As the saying goes "the market can remain irrational longer than you can remain solvent" In this case, Google is the market and they can just keep throwing money at the wall until OpenAI, Anthropic, etc. go under.
Social media has strong network effects that keeps competitors at bay. What network effects are OpenAI/Anthropic/etc accumulating?
Yes, but Gemini is actually good and so are their APIs.
Agree. Look at how miserably MSFT has failed at integrating AI tastefully in their business.<p>Google makes money selling ads. Nothing else matters.
Because the product quality doesn't matter if the competition isn't making any money.
google the only ai which invests mixing llm ai with real ai, and it seems work well.
race to the bottom. google in house cheaper inference hardware. anthropic buys it.
The conclusion Google is engaged in consumer capitalism is wild.<p>They're engaged in computing research and merely engage in consumer capitalism as a consequence of political and social constraints.<p>Products are a means to an end not the goal.<p>OpenAI and Anthropic are product companies and are more likely to fail like most product companies do as they will lack broad and wide depth.<p>Google has experience in design, implementation, and 24/7 ops with every type of SaaS there is. They can bin LLMs tomorrow and still make bank. Same cannot be said for OAI or Anthropic.
Persistence. Google has a lot more endurance then OpenAI does in this game.<p>The current AI market is going to destroy anyone who's specialized into it compared to having alternative revenue streams to subsidize it.
Do they though?<p>Google does things <i>I hate</i> with their products. But the money printing machine keeps going whrrr faster and faster.
> It’s an impossible war and all these investors are throwing their money into a bottomless insatiable pit of money.<p>Anthropic went from zero to $14 billion in revenue in less than 3 years, growing at 10x per year.<p>That's what they're investing in.<p>Also Anthropic seems laser-focused, unlike some of their competitors who are throwing stuff against the wall to see what sticks.
Well there's a good reason that OpenAI partnered up with Microsoft. The calculation is that the established big techs - Amazon, Apple, Microsoft, Google, Meta are all going to be significantly impacted by AI so it's not unreasonable to look at Anthropic at 10% of their market cap as a reasonable value. Would it be worth Apple to bring Anthropic in house? They failed to deliver AI themselves, they know the risks of being dependent on Google. If AI goes far enough it may totally remove Apple's differentiation.<p>Some of the Big Techs are building their own in house stuff (Meta, Google), but it wouldn't be crazy to see acquisitions by the others, especially if the market cools slightly. And then there's the possibility that these companies mature their revenue streams enough to start actually really throwing off money and paying off the investment.
> they know the risks of being dependent on Google<p>I wouldn't argue it's that risky. Look at their past entanglements:<p>1. Google Default Search Bribe - brings in $20B a year for literally doing nothing<p>2. Google Maps: Google let them build their own custom app using Google's backend, and it worked fine all the way up until Apple chose to exit that arrangement<p>actually I can't think of any others, but is there an example of Apple getting burned by Google?
Have you ever used anything that is on google cloud console? Or tried not to get randomly ratelimited with a single request to a vertex llm model? They are shooting themselves in the foot for solid 20 years, any of these players can compete with google in this frontier
Slight counter point - claude code is basically the only developer tool that ever been happy to pay money for. Getting the entire software industry to give you $200/mo/person is quite the market.
> Getting the entire software industry to give you $200/mo/person is quite the market.<p>Quite the fantasy, you mean.
this matches my experience. i'm building a mobile game solo and the amount of leverage i get from claude is wild, probably saves me 15-20 hours a week on stuff that would've required either a second person or just grinding through slowly.<p>$200/mo is nothing compared to what that time is worth. and it keeps getting better with each model release, which is the opposite of what usually happens when you pay for developer tools (they get acquired, enshittified, or abandoned).<p>the meta point about this funding round imo: competition between anthropic, openai, and google is the best thing happening for small builders right now. it keeps the tools improving fast and pricing competitive. if any one of them had a monopoly we'd be paying 10x for worse output.
how does any startup beat an incumbent?
I think GP is probably implying that this particular vertical requires obscene amounts of capital to keep up, which makes it really hard for a startup if you’re going up against businesses with giant free cash flow machines.<p>It’s the same reason Reid Hoffman sold his AI startup early… he realized he just couldn’t beat Google/FB/MSFT long term if it devolved into a money race.
The most efficient way Google could spend that money is probably to buy a company and not poke at it too much. I have no confidence that large rich companies can actually innovate beyond buying small innovators or spawning business units and not poking at them much.
Google's only focus isn't on Gemini. Anthropic is do-or-die
Look at Sundar's most recent remarks and tell me Google's isn't only focusing on AI: <a href="https://blog.google/company-news/inside-google/message-ceo/alphabet-earnings-q4-2025/#introduction" rel="nofollow">https://blog.google/company-news/inside-google/message-ceo/a...</a><p>Basically "we have youtube subscribers" is the only thing that isn't all about AI, but even that i'm sure they're trying to figure out how to shoehorn AI into that product
Also Theranos was do-or-die and we know how it ended.
The same way that Google+ never overtook Facebook
How long is Google going to be able to keep selling search engine ads?
just want google to have good web apps again, it's so bad on desktop
Given the amount money that they are spending for vastly subpar products maybe they need to quadruple their capex
I’d guess they want to outlast OpenAI and then get bought by Apple or Amazon.
Google has invested in Anthropic. I don't trust that Google will compete on fair grounds with Anthropic on coding. Their common enemy is OpenAI.
Culture.
Google is invested in Anthropic