A correction on this statement: “What the data does show, unambiguously, is that the tool works well enough for hundreds of thousands of professional developers to use it every day. That’s not a beta test. That’s a market.”
A market must meet two constraints:
1. User wants
2. User is willing to pay.
I use Clause code on the $100 pro plan. I can’t tell how many credits I’m using to produce the code. Its very good at creating code especially for my wordpress/woocommerce site but also to Square, Quickbooks, and my mac.
But its the amount of credits I’m using really a profitable business for Anthropic? I’m guessing the power + capital amortization costs could be really be in the thousands per month. If a developer is getting paid $10K a month. Claude code may be just as expensive as a human right now.
The future based on TPUs specifically designed for the LLM and localization of the LLM on my mac could change the cost to anthropic. But the company that is best positioned to do that is Apple, not Anthropic.
LLMs are very cool and amazing. Whether LLMs can create a profitable business cases is TBD. So much of the AI discussion totally skirt when their will be a positive business case and what tech will make that happen. Can claude engineer its own LLM to take 10x less power and 10x less infrastructure? Bottom line, NVidia is in deep trouble because their margins are a big part of the business case issue. How do they engineering their way out of wall street exceptions that they maintain their margin when they are part of the problem.
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