China isn’t allowed to use advanced expensive US models. And US nationals can’t afford advanced expensive US models so they want to use Chinese models.
What a weird situation. Huh?
An interesting side effect is that the models coming out of China are very efficient. They don’t have access to all the high-end hardware the US has, so they have to make do with what they’ve got.
Just like Japanese motors and the oil crisis in the 70s.
This administration can’t see a week ahead in front of them. Does anyone have doubts this will only consolidate China’s autonomy and eventual dominance in the sector?
If ONLY there was a Cheaper way to get MORE Work done with LESS Mistakes! OH WELL! Don’t forget to BUY our Products with your
Unemployment Checks!Savings!WHY aren’t people BUYING things?I see you’re problem. You’re using the old Fordist mode of economic growth, wherein you employ people at an income level such that they can buy the products they produce. Then you grow your capital stock by reallocating the labor surplus into new undeveloped areas of the country. That model of growth went out of fashion in the 80s.
Post Volcker-Shock, we adopted a strategy of indebting unaligned countries in exchange for modern technological improvements, then harvesting their natural resources at a functional loss to finance the USD denominated debts they struggled to pay back. Then we could effectively export dollars for cheap imports and allow Americans to buy them with money laundered through government contracts, grants, and Fed credit expansion.
But after COVID, we’re on to an even more revolutionary approach to profitability. We don’t need consumers. We don’t need to develop capital in foreign territories. We just do a direct 1:1 exchange of B2B SaaS services and American Dollars with the corporate oligarchs. Now people don’t need to buy anything, because governments buy everything. And if you’re friendly with the government, you get a slice. And if you’re not, you get shoved off a cliff.
so now they’re gonna be buying more hardware, too, so they can run their own models instead.
great.
at this rate they’ll be buying Chinese hardware in a couple years
$14000 in API pricing is not $14000 in costs, though. Costs are hard to calculate because of the huge capital outlays and unknowns about hardware lifecycles, various business deals, and limited public knowledge.
It’s likely that inference costs for good-enough models will go down over time. China’s API pricing tells us the direction already. Energy costs will be a driving factor in the west, I guess.
So… they are almost certainly subsidizing plans right now, but on average, it won’t be by sooo much. Your average ChatGPT user will hardly use Codex, for example. Your average developer is not token-maxxing either.
Why are they subsidizing plans? To build a sticky customer base … which means they want you to stick to their tools - their coding agents/harnesses, their integrations, etc. Models are/will be increasingly interchangeable, so they are building sticky ecosystems instead.
neither copilot nor anthrophic offer a business ready harness and people are going open source already. Yeas, their cli, ide integrations are nice but security-wise all this is rather begging the agent not to do dumb stuff instead if actually restricting it in access to customer data, secrets etc.
To be fair, protecting credentials and important data is the company and individual’s responsibility. The building blocks to restrict access are there, but are often not leveraged (even by large companies with the ability to invest)
Sandboxing is one of them: Both Codex & Claude’s sandboxing is reasonable (sandbox-exec, Linux cgroups & seccomp). Many others are lacking, sometimes deliberately.
I do most coding with Pi these days, and I have it heavily sandboxed. I expose sensitive services via a localhost network service with auth (typically for running scripts outside the sandbox). Reads are limited to the system binaries/libs, nad writes to the project dir & Pi’s own dirs. If I choose to give a particular session creds, then I have to be very deliberate. I also force egress traffic through a proxy (just logging for now, but I have plans)
So it begins.
Qwen3.6 35b-A3B 4bit does pretty darn good on a $1K Intel B70 running Llama.cpp SYCL with Kilo Code and OpenWebUI. Just saying.
Legal won’t allow Chinese models where I work—not just in production, but on employee machines or any company-owned device. I believe the rationale is they don’t want any legal problems if federal or state bans are enacted for “national security”, which certainly isn’t an unfounded fear. I have a feeling a lot of larger companies will be implementing similar policies, and I do also worry that any individual using Chinese models for personal use will be arrested and charged as a terrorist or something. Chinese open weight models like Qwen are fantastic, but it does feel a lot of eggs in one basket.
