Thread

FTC is investigating OpenAI, Anthropic and other AI companies over product risks

210 points · 160 comments · dgellow

amelius · 1790860691 · focus · HN ↗
They should be investigating them because of massively selling below cost price.
How is this a fair, level, playing field, U.S.? Making a large pile of money to put millions of people out of a job, it warrants some investigations!
1. gtCameron · 1790860810 · focus · HN ↗
  Do you have any evidence of this assertion? What is 'cost price' and what is being sold below that?
  1. hedora · 1790861450 · focus · HN ↗
    Claude says my token spend is $15k per week. I’m being charged $50.
    They can only do that because of circular finance deals and other fraud. Those deals are also the reason a machine that’d run ~ Claude Opus 4.6 locally costs $5000 instead of the original $1400 MSRP.
    NathanaelRea · 1790863005 · focus · HN ↗
    Their margins are 90-95%. If I have a gym that charges $50 for an hour pass, but $100 for a month "subscription", would you feel the same way, that you got $36k of value?
    dgellow · 1790863318 · focus · HN ↗
    That percentage is speculative for now, we don’t actually know their margin. What we know is that Anthropic said publicly they have 80% gross margin IFF they use their own adjusted EBIDTA metric, which ignores revenue sharing, training costs, and stock based compensation
    lelanthran · 1790883335 · focus · HN ↗
    > Their margins are 90-95%.
    Where did you read that? Linky?
    arctic-true · 1790864731 · focus · HN ↗
    For antitrust purposes below-cost pricing is not expressly illegal. It is only illegal if there is a “dangerous probability” that the firm in question will be able to recoup its losses after eliminating its competitors by taking away all their demand and then jacking up prices when they’re the only game in town. In the case of your Claude tokens, even if they’re being sold below cost, they’re being sold for more than anyone else is selling tokens. So it’s hard to argue that they’re going to drive everyone else out of the market with their pricing.
    amelius · 1790864958 · focus · HN ↗
    > So it’s hard to argue that they’re going to drive everyone else out of the market with their pricing.
    Eh, their AI is going to put millions of people out of a job ...
    AnimalMuppet · 1790866912 · focus · HN ↗
    For the antitrust argument, that is irrelevant.
    amelius · 1790867157 · focus · HN ↗
    I don't think so. But maybe your definition of fair competition is more narrow than mine.
    Gormo · 1790870306 · focus · HN ↗
    I think the previous commenter is referring to the actual legally applicable definition, not his own definition or yours.
    amelius · 1790872380 · focus · HN ↗
    The law doesn't matter, it was not made for this. Let a judge make their own interpretation. If you talk about level playing fields, then you should act like it. Not allow VCs to make piles of money to put everybody else out of business.
    If this is not unfair competition, then what is?
    AnimalMuppet · 1790873419 · focus · HN ↗
    Judges are supposed to make their interpretation on the law. The law wasn't made for this? Then you better pass something that is. The alternative is to abandon the rule of law. "Just once, just for this urgent problem" rarely remains confined just to this problem. Keep the rule of law; pass a new one if you need to.
    amelius · 1790873965 · focus · HN ↗
    The problem with this approach is that the law will always be lagging behind. It is not fair to change the rules during the game.
    Therefore, the only solution is to ensure people act according to the spirit of the law, not the actual law.
    If you talk about "fair competition" then "fair" also applies to how the law works. If one party is always one step ahead, then that is not fair.
    Gormo · 1790880896 · focus · HN ↗
    > The problem with this approach is that the law will always be lagging behind. It is not fair to change the rules during the game.
    Why is that a problem? Why would we want prescriptive rules to be formulated in advance of the reality to which they're meant to apply being fully understood?
    > Therefore, the only solution is to ensure people act according to the spirit of the law, not the actual law.
    Which is something our actual legal system already does fairly well, precisly because it doesn't overemphasise technical, instrumental details, and applies broad rules to intentional conduct in an often form-agnostic way. For example, anti-trust laws about collusion and price fixing wouldn't care about what specific communications medium was used to coordinate collusion, apart from validating the evidence that there was indeed collusion.
    In this case, I think the mistake you're making is in thinking that restrictions on the introduction of new technologies based on the long-term effect they might have on demand for particular services in the overall economy is something that is within the spirit of the existing law. It isn't. It never has been.
    People have certainly worried about how new technologies would impact people's earning power over time, dating back centuries to at least the era of steam engines and railroads, but that's never translated into any legal framework allowing for restraining the development of new technologies. Anti-trust law has nothing to do with it, and the spirit of the law behind it has always been aimed at protecting consumers against market manipulation, not protecting employees against reduced demand for their services.
    lesuorac · 1790873584 · focus · HN ↗
    Putting people out of Jobs isn't directly an anti-trust concern.
    The concern is predatory pricing [1]. Which may or may not result in job loss (the surviving company could hire/acquire the dieing companies).
    [1]: <a href="https://www.ftc.gov/advice-guidance/competition-guidance/guide-antitrust-laws/single-firm-conduct/predatory-or-below-cost-pricing" rel="nofollow">https://www.ftc.gov/advice-guidance/competition-guidance/gui...
    Gormo · 1790876962 · focus · HN ↗
    > The law doesn't matter, it was not made for this.
    Not sure I'm following. This appears to be a conversation about how the law applies to the situation.
    > If this is not unfair competition, then what is?
    Again, "unfair competition" has a specific legal definition. If you don't care about the specifics of the law, and are just expressing your own normative opinions about how you'd prefer for certain things to play out, what is the purpose of attempting to express those opinions using specific, already existing legal terminology?
    TheCoelacanth · 1790883684 · focus · HN ↗
    Judges making their own interpretation is the entire problem with anti-trust law.
    The law is very explicit: no mergers or acquisitions where the "effect may be substantially to lessen competition". Not "will" lessen competition, "may" lessen competition.
    The law as written should prevent basically any merger between large competitors. Judges have watered that down with bullshit about customer harm that appears nowhere in the law.
    lelanthran · 1790883261 · focus · HN ↗
    > It is only illegal if there is a “dangerous probability” that the firm in question will be able to recoup its losses after eliminating its competitors by taking away all their demand and then jacking up prices when they’re the only game in town.
    Aren't the competitors in this instance the workers?
    deepwoods · 1790914838 · focus · HN ↗
    Not really, no. Anthropic sells tokens, not services. It's up to the user to turn those tokens into something useful.
    There are also non-price reasons to switch from human labor to agentic labor. No sick days, no recruiting costs, no moral foibles, etc. It's like arguing that Ford competes with Uber - both are ultimately selling you a way to get from A to B, but they are doing it in radically different ways.
    lelanthran · 1790946209 · focus · HN ↗
    >> Aren't the competitors in this instance the workers?
    > Not really, no. Anthropic sells tokens, not services. It's up to the user to turn those tokens into something useful.
    > There are also non-price reasons to switch from human labor to agentic labor. No sick days, no recruiting costs, no moral foibles, etc.
    I have to know, how can you call them "agentic labour" and still claim that it is not competing with human labour?
    ChrisRR · 1790866357 · focus · HN ↗
    Frying pan infomercials say I'm getting a £200 value for only £29.99. I'd take their claims with a pinch of salt
    user43928 · 1790866537 · focus · HN ↗
    For $15k you can rent like 14x B200 on-demand at retail prices and run them continuously for a week.
    According to this analysis, at 70 tokens per second for Kimi K3, you could expect to run >800 parallel streams on that setup:
    <a href="https://inferencex.semianalysis.com/run/kimi-k3-on-b200" rel="nofollow">https://inferencex.semianalysis.com/run/kimi-k3-on-b200

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