Gerstner identifies a fifteen-year trend of top tech companies using open source strategically as a defensive weapon, starting with Android.
“And Google convinced the rest of the world, all the handset manufacturers, the carriers to support this model by telling them it was going be open.”
Gerstner says smart Silicon Valley companies use open source as defensive weapon, starting with Google's Android.
“Something happened over the past, I'd say fifteen years, where some of the smartest companies in Silicon Valley have developed a new strategic play, where they use open source as a defensive weapon rather than as an offensive weapon. That's my terminology. Of the first to do it was Google with Android”
Gerstner reports Sam Altman said OpenAI has been on wrong side of history on open source.
“Sam said, yes. We are discussing. I personally think we have been on the wrong side of history here, and we need to figure out a different open source strategy.”
Gerstner characterizes OpenAI as shifting from regulatory advocacy to launching open source models.
“And now I think it's like more clear, the distinction that's being drawn. OpenAI is talking about launching an open source model here shortly,”
Gerstner notes Alibaba's Qwen model has passed 400 million downloads under Apache 2.0 license.
“Of course, that's released like these other models under the Apache 2.0 open source license, so very open, as Bill's talked about.”
Gerstner poses whether AI's future will be dominated by closed corporate giants or open source.
“Are we heading towards a future dominated by a few closed corporate giants or will open source win the day?”
Gerstner reports his personal token usage is ten times higher on frontier models and over one hundred times higher on open-source models since January.
“@altcap my token usage since jan is 10x on frontier models and like 100x+ (barely used them) on oss models.”
Open-source models are gaining market share in token usage while both open and closed models continue rapid overall growth.
“@Jason Agree. Grt competition! Share of tokens increasing at open source models (tho both still early in growth curve & growing rapidly).”
Corporate buyers are increasingly choosing open-source AI models over proprietary ones to avoid vendor lock-in with their data.
“It's not that frontier models are dead; it's that open-source models are surging in interest from corporate America and startups -- because people don't want to give their intelligence to private companies.”
Gerstner argues competition between frontier and open-source models is not zero-sum because both revenues fund American AI infrastructure.
“Brad Gerstner posted that he has heard claims frontier models are dead for 18 months yet argued competition with open source is not zero sum, as revenues from both are needed to fund the annual capex for American AI infrastructure.”
Gerstner claims that open-source AI models are increasing their token usage while frontier labs are capturing more of the actual revenue.
“Token consumption is going up for the open-source guys while share of economics is going up for the frontier labs.”