I am migrating my company to private open source AI and building custom tooling, orchestration, an IDE and harness around it. The commercial labs have show it’s far too risky to build on top of them.
With the labs moving into the app layer every interaction with the API related to product development or innovation is data they will steal and use to compete against you by adding those features to their everything apps. No one would hire a knowledge firm (law firm, accountants, management consultants) if they could steal your information and give it to your competitors. Their actions have remained me that we can’t tolerate that with AI systems.
With spaceX buying cursor and Google buying windsurf, and gathering all the developer interaction as training data, there is too much risk that development process itself will be rug pulled.
This makes sense but I am not comfortable with the open source picture either. It depends on the use case and long term strategy. If you're handling customer support tickets or something, beyond some capability I can't imagine the ROI would be worth needing the absolute frontier. You are then in a wonderfully lovely place: absolutely full control over the model and inference stack (if you want).
But
- Plenty of businesses are stuck between a rock and a hard place: make 3p models load bearing, or sacrifice performance to the competitors that are willing to swallow that risk
- I just cannot imagine a viable equilibrium where OSS models compete on capabilities with the frontier without a hidden payer and shaky economics. Quant funds, some sovereign AI effort, cloud business, sanctioned distilled frontier models; all of these are demonstrably viable vehicles for OSS development. But the optimal position for these purposes is not to be the best, it's to be good enough (which I think is the position they find themselves in). I can imagine temporary points where open models pull ahead but not sustainably.
I agree there are many many use cases where the optimal choice is to reach for open weight models (I assume yours is one of them).
But the economics of frontier model development necessitates that these models are behind and thats a problem for other cases.