The AI Development That Just 10X’d the Rate of Innovation

Developers can now add OpenAI's ChatGPT and Whisper into apps and products using an API.

ChatGPT is OpenAI's now-famous conversational interface. Whisper is the company's human-level speech recognition model.

With the API come major cost savings.

Since December, OpenAI says it has reduced the cost of ChatGPT alone by 90%.

The bottom line?

It's now much easier and cheaper to bake ChatGPT and Whisper into your business.

OpenAI offers some early examples of how top companies are already doing that:

• Snapchat just released My AI, a chatbot that users can converse with. It's built on the ChatGPT API.
• Instacart has used the API to pair ChatGPT with its own data. Customers can now ask Instacart questions like "How do I make great fish tacos?" and get a response with relevant products.
• Speak is an AI language learning app and the fastest-growing English app in South Korea. They’re using the Whisper API to power an AI speaking companion product.

In Episode 37 of the Marketing AI Show, Marketing AI Institute founder/CEO Paul Roetzer talked to me about why this is such a big deal.

1. This just 10X’d the rate of innovation.

“Basically, this just accelerated the rate of innovation by 10X,” says Roetzer.

That’s thanks to decreasing costs and open access. It just got way cheaper (and, by definition, way faster) to build. And it’s going to force the rest of the market to make their models more affordable, too.

As a result, you’re going to see even more rapid innovation in AI.

2. You need to think carefully about moats.

In a recent analysis by Andreessen Horowitz, the VC firm found very few competitive moats in generative AI, thanks to this rate of innovation. That rate is so fast that solutions are quickly commoditized and then replaced by better solutions.

This leaves only a couple of moats for products today, says Roetzer.

“Distribution matters,” he says. “Your existing audience size becomes critical.”

For example, HubSpot just released generative AI features. They weren’t remotely the first company to do this. But they have an existing customer base of 167,000+ companies already using their platform—a competitive advantage few startups can match.

Also, data matters, says Roezter. When we all have access to the same models, the data you train those models on becomes a serious competitive advantage.

Look to either distribution or data—or both—when you build or build on top of generative AI.

3. Expect big winners and consolidation.

It’s very likely the big players, the ones with the most distribution and data, end up winning big—and getting bigger—as their moats widen.

There may also be a period of rapid consolidation in the market as generative AI tools get churned out, get acquired, or become obsolete.

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