Enterprise users tolerate brittle agents; consumers walk away

Transcript

Transcribed by machine (Whisper) from the episode’s audio, so a word may be off here and there.

1. 16:16

   And its frontier capability is actually not the important thing. It's its capability capability. I think the more money and power you have at one of these companies, you get a little bit mentally farther away from what the average consumer wants. So let's say the average consumer does want an AI agent, which many of them don't, as we know. But let's say they do. If they do, they're going to want it to be free or cheap.

2. 16:41

   and they are going to want it to be safe to use without creeping them out too much. You know, they're willing to deal with a little bit of creepiness in order for it to be free, but not too much. Meta's Muse, the headlines about some of the privacy issues with it have gotten a little bit above that comfort level, I think, for some users. That's probably why OpenAI at Dev Day made a lot of, you know, remarks about privacy and the importance of that, especially if they're trying to court enterprise users with their AI agents.

3. 17:15

   Right now, these companies are trying to, especially Meta, just kind of trying to flood the market and create a mass market appeal for this stuff. Similar to how ChatGPT became the default AI chatbot, Meta wants to be that for AI agents, and they feel very hungry about it. They want to create a ChatGPT moment for this technology by making it the default use for the general public, Muse. I just think there's something really interesting about the idea that a less than frontier model wrapped in a better product is actually going to be the success here versus a bleeding edge frontier model that is a little bit harder to use.

4. 17:54

   And there's some dynamic in there that is the history of all consumer tech products, right? The worst product that's easier to use often wins, but we haven't seen that yet in AI. Right. I think that's really important to note here because not everyone needs the bleeding edge frontier model. You know, software engineers do. They see a huge difference with coding prowess from one model to another, and that's why they're always switching. But the general public, if they're using an AI agent, as long as it's useful, they're good, you know. However, not many of them are useful yet. We're still testing Muse and Dots ourselves.

5. 18:28

   Muse, apparently, I saw a couple anecdotes yesterday that it had a big flop for a day or so. People felt like the capabilities got a lot worse. Dots, you know, the jury's still out. We're still testing it. But it depends on what industry you're in and what you're really using this stuff for. That's why OpenAI is going for enterprise because it makes money and they're confident that their agent is going to be more and more helpful in these niche industries.

6. 18:54

   That's also why they launched specialist dots, because as we know, the more specialist niche info you feed into an agent or model, the better it's going to do, obviously. And they don't want to have that imbued into every single agent or general purpose agents, just too pricey and too compute heavy. So they're like, you know, let's launch these specialists. I feel like you and I talk about consumer versus enterprise adoption of AI every time you're on the show.

7. 19:20

   And here it seems very important to note that OpenAI asking people to pay a lot of money and asking people to use it primarily in enterprise context is going to overcome what I think of as the brittleness problem just because enterprise customers, business customers have a lot of economic incentives to figure out how to make something work. So if I'm paying open at $100 a month and I'm using the marketing dot to solve some marketing automation and it doesn't work the first time, it is very likely I will try again.

8. 19:51

   Because if I get it right, then maybe I've saved some money or some time in my business. That is really good and I'll do it again. And eventually that will lead to more revenue for me, the business owner. What I know about consumers is that the first time it doesn't work, they just walk away. They have no incentive to try again to overcome frustration or brokenness. And we've seen this happen with Muse now a few times.

9. 20:14

   I've seen it myself with Muse where it pops open a browser and tries to do something and it runs into a brick wall or a captcha or Amazon blocking it. And it says, hey, I can't do it that way. Do you want me to try another way? And I'm like, ah, whatever. I was just screwing around and I'm never going to try it again. These are very different markets. OpenAI has vacillated between wanting to be the big consumer company and knowing that the revenue is an enterprise.