Gerstner notes rates have jumped from zero to 8% mortgages, 10% car loans, and 20% credit cards.
“We've gone from effectively a 0% interest rate environment in ZERP, where corporations borrowed for free and consumers borrowed for free, to now we have 8% mortgages. We have 10% car loans.”
Gerstner reports OpenAI consumer product has 65% annual churn rate based on credit card data.
“At least for the cohorts that are old enough, the churn's about 65% annually. So they're only 35% retaining, which Sax had hinted at on all in.”
Gerstner estimates OpenAI's consumer business represents $2.1 billion of roughly $3-4 billion total revenue.
“It would imply that there are about 2.1 of the three four is the consumer business”
Gerstner argues consumer ownership, not hardware, determines value; Google dominated for twenty years this way.
“The battle for the consumer is ultimately where the value accrues, Sonny, not who runs, you know, what hardware.”