Benedict Evans

And is that sort of how LLMs will work in that it's about the distribution and the brand is not actually about the product or the model?

Or is it maybe more like social in that, yeah, photo sharing is a commodity, but there's a big difference between Instagram and Flickr and all the other people that try to do photo sharing.

um usage to continuously make the investment well that's a slight this is slightly different thing so the winner there doesn't appear to be a sort of self-reinforcing cycle in which more people use it because more people use it the product gets better because more people use it so more people use it which is

what you have with operating systems because you have more apps therefore more users therefore more apps so what you have with google search that google has all the feedback from how people use it that makes the search engine better you have a network effect in social media that you're there because you're there because your friends are there because you're there there's no apparent equivalent in llms right now there's no reason why the llms get better because more people use them now that may come you have that the open ai and people have been doing memory

where it remembers what else you've asked but that seems more like a switching cost than a network effect and also it might be easier for you to just ask it what it knows about you and then tell claude or vice versa so it's not clear if that but we are that sort of stage where you're looking at the browser and saying is there a way that you can create stickiness here or that you can create a network effect on the browser or is it just that the browser itself is a commodity um now capital is

is not a winner-takes-all effect in that convention.

At any rate, it's a different kind of winner-takes-all effect.

I mean, I wouldn't conventionally think of capital as a network effect.

It's not something that's inherent in the product.

It's something else.

It may be that, yes, OpenAI has more money so they can make their model better.

We don't have visibility on what that would be yet.

But we should kind of go back and think about MySpace.

Because you have like, it would be MySpace, in the early phases of these things, and you see the same thing with the early PC industry, you've got a dozen of them.

And there's often an early leader that falls away later.

And so MySpace was the early leader that fell away later.

Then you get a late stage where the S-curve is kind of flattened out, where all the network effects have kind of solidified and the product quality is solidified.

It was very easy, actually, to get people to switch back and forth between MySpace and Facebook and Bebo and Friends Reunited and whatever, Orkut and all these other things.

in the early days, then you kind of get this separation out.

But then, of course, then Instagram comes along, and then TikTok comes along.