Do software companies actually have good margins? - ’In other words, software development costs are COGS. Not literally; not according to the accountants. But in practice, if you can only sell SaaS software—and retain customers—by promising a steady stream of new releases, how are the expenses associated with developing those releases functionally any different than the money you spend on servers and support agents?’
Amazon Isn’t Killing Just Walk Out But Rather “Pushing Hard” On It - Hmm, hopefully we’ll see some nuanced corrections in all them news outlets…
Notes on how to use LLMs in your product. - “Even the most expensive LLMs are not that expensive for B2B usage. Even the cheapest LLM is not that cheap for Consumer usage – because pricing is driven by usage volume, this is a technology that’s very easy to justify for B2B businesses with smaller, paying usage. Conversely, it’s very challenging to figure out how you’re going to pay for significant LLM usage in a Consumer business without the risk of significantly shrinking your margin”
The Art of Product Management in the Fog of AI - “before products launch, it’s critical to run the machine learning systems through a battery of tests to understand in the most likely use cases, how the LLM will respond."
‘This shit’s so expensive’: a note on generative models and software margins - “The fundamental problem with generative models is that they are 10x too expensive to work with the industry’s default business models and structure. Either these companies who are going all-in on ‘AI”‘need to fundamentally change everything about how they work – laying off a bunch of people won’t make ML compute 10x cheaper so they’d need to change the org to survive on razor-thin margins – or they need to discover some undefined magical way of lowering compute costs 10x. So far they’re opting for magic."
Forrester: IT departments are blowing their cloud budgets | Computer Weekly - “Nearly three in four (72%) of the IT decision-makers polled reported that their company exceeded its set cloud budget in the most recent fiscal year. Among the areas experiencing an acceleration of cloud deployments are: applications/workloads in IT operations (54%); hybrid work (50%); software development platforms and tools (45%); and digital experiences (44%).” // vendor-sponsored // has ranking of causes.
Substack Is Setting Writers Up For A Twitter-Style Implosion – Home With The Armadillo - Seems weird. // “New reporting from The Wrap details how Substack’s decision to implement a new “follow” feature — part of its transition from newsletter publishing platform to social media site — has tanked subscription growth for lots of newsletter writers."
Kubernetes community capitalizes on open source and AI synergies - Among AI talk, 451’s Kubernetes TAM: $1.46bn in 2023, growing to $2.85bn in 2028.
Americans increasingly using ChatGPT, but few trust its 2024 election information, Pew Research Center - Techmeme summary: “A survey of 10,133 US adults: 43% of those aged 18-29 used ChatGPT in February 2024, up from 33% in July 2023, compared to 27% of 30-49 and 23% of all adults”
AI - two reports reveal a massive enterprise pause over security and ethics - “When we go into a CIO discussion, it’s ‘How can I use Gen-AI?’ And I’m like, ‘I don’t know. What do you want to do with it?’ And the answer is, ‘I don’t know, you figure it out!’"