Gavin Baker Clashes with Gary Marcus: Model-Layer Monopoly Would Crush Neoclouds
GavinSBaker · x · 2026-09-21
Responding to Gary Marcus's claim that more profitable LLM businesses benefit neoclouds, investor Gavin Baker calls it "super obviously not true": a single lab with 99.999999% margins would be a disaster for neoclouds and suppliers, as monopsonies squeeze providers. He argues fragmentation at the model layer benefits everyone outside it — even a world with zero model-layer profits but high returns for chips, datacenters, and power.
Related event: Baker vs Marcus: Do Fat Model Margins Help or Hurt Neoclouds?(5 posts)→
More from Venture
- Chart: AI hits $55.6B annualized revenue in 2026, still trailing GLP-1 drugs — HealthcareAIGuy · 2026-11-12
- Nvidia scandal pushes TL20 portfolio to drop NVDA after 1,084% run since 2022 — TiernanRayTech · 2026-11-12
- 100 paid AI builds audited: 3 systems fetching $5k-$18k checks, chatbots only $1,100 — aryanXmahajan · 2026-11-12
- CoreWeave turns to customer prepayments and shorter contracts to fund AI growth — TechCrunch AI · 2026-11-12
- Bittensor Subnet NOVA Bets on Real Drug Assets to Prove Its AI Discovery Platform — markjeffrey · 2026-11-12
- Foreign Investors Pull $50B From Asian Equities in October on AI Cash-Burn and Regulation Fears — nordicinst · 2026-11-12