OpenAI Scaling Laws
How OpenAI discovered that AI quality is predictable — spend twice as much on compute, get a measurably smarter model — and why that makes capital the ultimate moat.
Most AI research followed a pattern, build a model, run it, hope it works. OpenAI discovered something else. The relationship between compute spending and model quality was predictable. Spend twice as much on compute and data, and the model got measurably smarter. You could forecast performance months before running experiments. Companies with unlimited capital could compete on dimensions others couldn't. You don't need to be clever, you need to be rich. OpenAI raised 500 million from Microsoft. They trained GPT-3 with 175 billion parameters. The performance jump compared to GPT-2 was staggering. Competitors thought they had cracked something novel. OpenAI had just spent 10 times more.
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