This is a prepared statement for congress by Nathan Lambert, author of https://rlhfbook.com/ and AllenAi employee (one of the few who have shared their models as open source)
Impressive you know. They are a few months behind but still the world uses their models. Bet you because the users suspect that Americans will pull the rug from under them. Few months behind versus being left behind forever. Would have been nice to know the differences in spending between the models but I suspect the data is impossible to collect.
That’s certainly part of it. I think people underestimate the value of getting to ‘good enough’. Once that’s reached, the economics start to be more of a factor in decision making.
However, I think geopolitics has also become a factor as the very existence of this article indicates.
It's not a suspicion, it has actually happened. US government briefly banned Fable for non-americans, and the american corporations pick and choose who has access to their unrestricted models which in practice excludes even american citizens, to say nothing of foreigners like myself.
They are literally segmenting the world into haves and have-nots, just like nuclear power. Thank god China is out there and constantly undermining them with their non-stop open weights model releases.
The best situation for us mere mortals is one where they struggle against each other endlessly without any hope of victory. The second either the US or China wins, it's pretty much over for us and unimaginable oppression will quickly follow.
DeepSeek and Qwen set a floor American open-weight models can't match without subsidy or a different cost structure, and that price/performance ratio drives adoption more than benchmarks.
As an aside, it’s always funny to me that anybody outside of Europe listens to anything the Europeans say about AI. The Europeans literally have zero skin in the game. Their entire raison d’être is just to pass regulations that they then attempt to extraterritorially enforce, but they contribute almost nothing to the area of interest. It’s legit insane to me.
The contributions they make vs the amount of inconvenience they are vis-a-vis compliance with their own esoteric rules probably fit some Pareto maximum of 20% of users requiring 80% of the work for compliance. The rest of us (ie, the non-European world) should honestly just point and laugh and then move on when these people try to influence things.
Not a fan of overregulation killing business, but Europe is definitely an important check against the surveillance powers of big tech companies in US. European regulations become a reference point for the rest of the world, especially poorer countries who dont have power to regulate US tech companies by themselves.
It's becoming more clear that for big enterprises to really adopt AI, they need to use open models. Especially if they want to own their own intelligence, which they should.
I spent the last 2 days building basic AI agents to automate some mundane supply chain workflows for a large company. Those seemingly boring workflows had bank statements, supplier IDs and other sensitive information.
For me it was all alarm bells, there is no way they can afford to give closed models access to this data. I was compelled to figure out an open model based solution for them, which made me realize that this is probably the only way for enterprises going forward.
I've actually flipped on this the last few days because of liability.
The big labs are going to be on the hook for rogue behavior by Claude or Sol. Customers will be able to sue for damages and deflect regulators if their customer data is abused or their agents attack external services.
If you use a Chinese OSS model and it goes rogue? Yeah good luck with that, your shop is 100% on the hook.
People - usually suit-wearers - have been making this spurious claim for decades, but it doesn't hold water.
The largest of the finest print reminding you that it's 'sold as is' (or more encompassing variants that might continue '... with no warranty for fitness of purpose') means that liability remains in the lap of the purchaser / consumer / operator.
(This has been a source of immense frustration over my career - where such people have assured me that they have 'recourse' (it's always vaguely described) by spending money on proprietary products & services, rather than opting for functionally equivalent or superior free options.)
I think your third paragraph is implying a distinction (or conflating the difference?) between LLMaaS's and self-hosting publicly available models.
If it's just where it's hosted that provides the legal insulation then things like OpenRouter would give you that. (But again, I suggest that it would not.)
If a frontier lab is willing to draft an SLA that assumes liability, corporate will pay for it as long as the cost/benefit is in favor of it over insourcing.
Sure, but that's quite a fanciful universe you're imagining there - the feasibility of a corporation obtaining insurance to cover that offer of liability ownership has got to be close to zero.
I know this is the risk management answer, but when you're the featured story on the news because of a data breach, noone hears "butbutbut it's Anthropic/OpenAI/whoevers fault...". So it's a balance between "there's someone we can sue" and "what's our reputation worth".
It actually does help a lot to be able to say your OpenAI agent was the fault. People recognize the name. The press doesn't want to write about Better Home Life Insurance agents running loose on the internet, nobody cares.
Having been at the table too many times working corp level incident response to major 3rd party breaches with executive management and spin doctors, no it doesn't. The headline is "Better Home Life Ins BREACHED!:", and somewhere in the 2nd or 3rd paragraph "BHLI says it was because agents went wild".
Now, some tech web site might lead with "Agents at it again...", but the WSJ, et al usually won't.
Everybody including companies need their own models, especially considering that llm providers like openAi have no problem siphoning off your data and intelligence by inspecting metadata. and claiming any resulting value as their own.
I don't think you need to trust them if you are running on something like bedrock. Then I think you're trusting AWS or whatever cloud equivalent you want.
As long as you don't have "realtime" workloads, owning the GPUs quickly becomes the economical option. The main cost problems is in e.g. chat applications where the workload is spikey, and users expect an near-instant response, for which you need to scale the GPUs to the highest spikes of the workload.
You really don't need to be large. $100k can buy you a lot of compute and it's less than hiring an engineer. With that kind of money you can build an LLM server for a dozen people.
One engineer's salary to accelerate a team of twelve is so cheap you can't afford not to.
Open models on-prem is the future, not a single doubt in my mind.
I'm old enough to remember when my company had everything on-prem (both analytical and operational databases and servers) due to cost and security concerns. Nowadays we have everything on GCP.
The biggest problem we had with on-prem was maintenance as it took a lot of staff and time to ensure decent reliability.
If you don't believe AWS follows their ToS, you shouldn't use any cloud provider for CPU/data storage/anything else either. That's not a mainstream position in the industry.
good question! i was able to build the agents by using Opencode and used a combo of locally hosted models. Specifically Kimi and Deepseek.
but didnt deploy an agent anywhere. instead we wrote all the code, system prompts, harness, etc locally and just shared those files with the customer.
all the customer had to do is deploy what we provided them on their locally hosted models, essentially just had to add inference. and boom, started working on their systems!
Thank you for sharing this perspective. I agree with the conclusions outlined. However, I would have appreciated more insights into the OpenAI OSS family of models like gpt-oss.
I’m super uncomfortable with the idea of a single company or country holding all the cards when it comes to AI. So from that perspective I welcome the Chinese models.
Additionally, the big labs’ formulation of AI as a US-vs-China national security issue is very convenient for keeping those pesky regulations at bay, and for ensuring AI financial bubble doesn’t pop before everyone can unload in an IPO first. Both of those offend my sense of fair play.
As an aside, it’s always funny to me that anybody outside of Europe listens to anything the Europeans say about AI. The Europeans literally have zero skin in the game. Their entire raison d’être is just to pass regulations that they then attempt to extraterritorially enforce, but they contribute almost nothing to the area of interest. It’s legit insane to me.
The contributions they make vs the amount of inconvenience they are vis-a-vis compliance with their own esoteric rules probably fit some Pareto maximum of 20% of users requiring 80% of the work for compliance. The rest of us (ie, the non-European world) should honestly just point and laugh and then move on when these people try to influence things.
So many paragraphs of Claude explaining why open models will be frontier soon, which is the daily propaganda. Beneficiaries are startups selling the "open works" narrative and Big AI for the "we are not an oligopoly" narrative.
He says he is briefing Congress members. As presented, not a single one will understand anything, which is perhaps desired. It is very hard to tell what game is being played here unless Substack released bulk subscription numbers.
Data points from my own usage, for whatever they're worth[1]. I'm just an individual contributor and hardly represent enterprise or large orgs:
I've been on Kimi, with a little DeepSeek-V4-Pro, GLM 5.2/5.3, and MiMo thrown in, for probably about a year now. It's great here!
For DeepSeek, I recommend their Reasonix harness strongly, due to its alignment to DeepSeek's prefix cache. It means mostly (95%+) cache hit input tokens, so very cheap large-scale code analyses and things that require mega context windows (at the cost of some attentional drift, yes). Reasonix does require that you send data to China.
For most everyday stuff outside of where Reasonix + DeepSeek just makes overwhelming sense, I use OpenCode/Maki/Pi/whatever harness I feel like using today with Kimi K3, via OpenRouter. This does not require sending data to China.
I also use Kimi K3 in Zed via OpenRouter quite a bit, but sometimes like to mix it up with the other models.
For local hardware experiments on my MacBook Pro (M4 Max, 128 GB unified memory), Qwen3.6-35B-A3B (speed) and Qwen3.8-27B (intelligence, but slow). As has been widely noted, this amount of unified memory isn't as useful as it seems, due to memory bandwidth and decoding constraints, lack of tensor cores (on the M4 Max, anyway), etc. A giant bag of memory isn't fast, but it'll let you load some impressively big models. The future M5 Studio Macs will continue in this general vein, but will of course be somewhat faster, particularly due to the apparition of tensor cores in the M5 -- excuse me, "Neural Accelerators".
The Chinese models are simply _excellent_, and cater to lots of use-cases and tastes.
[1] Disclaimer: this comment is largely a duplicate of https://news.ycombinator.com/item?id=49809605, which is not something I'd normally do. However, it seems a lot more relevant here than where I had originally posted it, in an article about gauging MiMo Pro v2.6 capabilities.
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[ 0.25 ms ] story [ 36.0 ms ] threadHowever, I think geopolitics has also become a factor as the very existence of this article indicates.
The world powers have only said things like "bigger and more important than the Manhattan project”.
So what gives you that idea?
They are literally segmenting the world into haves and have-nots, just like nuclear power. Thank god China is out there and constantly undermining them with their non-stop open weights model releases.
The best situation for us mere mortals is one where they struggle against each other endlessly without any hope of victory. The second either the US or China wins, it's pretty much over for us and unimaginable oppression will quickly follow.
The contributions they make vs the amount of inconvenience they are vis-a-vis compliance with their own esoteric rules probably fit some Pareto maximum of 20% of users requiring 80% of the work for compliance. The rest of us (ie, the non-European world) should honestly just point and laugh and then move on when these people try to influence things.
I spent the last 2 days building basic AI agents to automate some mundane supply chain workflows for a large company. Those seemingly boring workflows had bank statements, supplier IDs and other sensitive information.
For me it was all alarm bells, there is no way they can afford to give closed models access to this data. I was compelled to figure out an open model based solution for them, which made me realize that this is probably the only way for enterprises going forward.
The big labs are going to be on the hook for rogue behavior by Claude or Sol. Customers will be able to sue for damages and deflect regulators if their customer data is abused or their agents attack external services.
If you use a Chinese OSS model and it goes rogue? Yeah good luck with that, your shop is 100% on the hook.
The largest of the finest print reminding you that it's 'sold as is' (or more encompassing variants that might continue '... with no warranty for fitness of purpose') means that liability remains in the lap of the purchaser / consumer / operator.
(This has been a source of immense frustration over my career - where such people have assured me that they have 'recourse' (it's always vaguely described) by spending money on proprietary products & services, rather than opting for functionally equivalent or superior free options.)
I think your third paragraph is implying a distinction (or conflating the difference?) between LLMaaS's and self-hosting publicly available models.
If it's just where it's hosted that provides the legal insulation then things like OpenRouter would give you that. (But again, I suggest that it would not.)
If a frontier lab is willing to draft an SLA that assumes liability, corporate will pay for it as long as the cost/benefit is in favor of it over insourcing.
Right?
Now, some tech web site might lead with "Agents at it again...", but the WSJ, et al usually won't.
https://www.openaifiles.org/ceo-integrity
So if you're running open models on AWS GPUs, you might as well run Claude (which AWS supports, and doesn't share any data with Anthropic).
Same with Azure/OpenAI.
One engineer's salary to accelerate a team of twelve is so cheap you can't afford not to.
Open models on-prem is the future, not a single doubt in my mind.
The biggest problem we had with on-prem was maintenance as it took a lot of staff and time to ensure decent reliability.
I want to believe (pinky promises from terms of service don't count)
Ah... oh.
Well, it's a nice thought.
I guess it depends if we believe that or not.
I see the flaw in your clever plan...
but didnt deploy an agent anywhere. instead we wrote all the code, system prompts, harness, etc locally and just shared those files with the customer.
all the customer had to do is deploy what we provided them on their locally hosted models, essentially just had to add inference. and boom, started working on their systems!
Additionally, the big labs’ formulation of AI as a US-vs-China national security issue is very convenient for keeping those pesky regulations at bay, and for ensuring AI financial bubble doesn’t pop before everyone can unload in an IPO first. Both of those offend my sense of fair play.
Some open-weight models aren't so open in their license.
He says he is briefing Congress members. As presented, not a single one will understand anything, which is perhaps desired. It is very hard to tell what game is being played here unless Substack released bulk subscription numbers.
I've been on Kimi, with a little DeepSeek-V4-Pro, GLM 5.2/5.3, and MiMo thrown in, for probably about a year now. It's great here!
For DeepSeek, I recommend their Reasonix harness strongly, due to its alignment to DeepSeek's prefix cache. It means mostly (95%+) cache hit input tokens, so very cheap large-scale code analyses and things that require mega context windows (at the cost of some attentional drift, yes). Reasonix does require that you send data to China.
For most everyday stuff outside of where Reasonix + DeepSeek just makes overwhelming sense, I use OpenCode/Maki/Pi/whatever harness I feel like using today with Kimi K3, via OpenRouter. This does not require sending data to China.
I also use Kimi K3 in Zed via OpenRouter quite a bit, but sometimes like to mix it up with the other models.
For local hardware experiments on my MacBook Pro (M4 Max, 128 GB unified memory), Qwen3.6-35B-A3B (speed) and Qwen3.8-27B (intelligence, but slow). As has been widely noted, this amount of unified memory isn't as useful as it seems, due to memory bandwidth and decoding constraints, lack of tensor cores (on the M4 Max, anyway), etc. A giant bag of memory isn't fast, but it'll let you load some impressively big models. The future M5 Studio Macs will continue in this general vein, but will of course be somewhat faster, particularly due to the apparition of tensor cores in the M5 -- excuse me, "Neural Accelerators".
The Chinese models are simply _excellent_, and cater to lots of use-cases and tastes.
[1] Disclaimer: this comment is largely a duplicate of https://news.ycombinator.com/item?id=49809605, which is not something I'd normally do. However, it seems a lot more relevant here than where I had originally posted it, in an article about gauging MiMo Pro v2.6 capabilities.
So "open models" buy you little and the independence from the oligopoly is not achieved.