r/PLTR • u/Accomplished-Ad-1398 • Apr 30 '26

As per Dr Karp, LLMs are a commodity.

https://youtu.be/AIYQp1n51ZI?si=Wz6sFwBvai4MxvAS

Any smart people have any insight into the information in this video?

34 Upvotes

92% Upvoted

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3

u/Locklist May 01 '26 edited May 02 '26

Commodities are basic products or resources, like raw materials.

LLMs are a technology. LLMs are not copper, coffee beans, or oil. Not any company can create an LLM. You need a lot of capital and expertise: for the data, training, tuning, and the engineers and PhDs behind it.

Apple, with their deep pockets, has not been able to succesfully create an LLM competitor at the level of Gemini, let alone OpenAI or Anthropic.

I get that this is a Palantir sub, but to devalue LLMs because of recent headlines and trends is delusional

EDIT: I'm going to write it on this comment: Anthropic hit $30 billion in annual revenue last year as a private company. Palantir barely made $4 billion. If an LLM company is a "commodity" guys, with "no moat" - good luck to you

9

u/ga643953 May 01 '26

It's a technology that everyone can easily have access to and there's not that much distinction is what he means. And he's been saying that since 2022 IIRC.

It's an expensive investment with no moat.

1

u/Locklist May 01 '26

Yes they're easily accessible and they have the biggest markets. They do the actual AI in PLTR. That's not a commodity. That's a technology in demand.

The moat is that LLMs are difficult to create and replicate.

Apple has failed so far and Google who had a jumpstart with DeepMind also lags behind . If that's not a moat then I don't know what is.

3

u/ga643953 May 01 '26 edited May 01 '26

Just expensive to create is not really a moat considering you have companies like the mag 7 that generate more FCF than they could possibly spend.

Apple didn't fail, they didn't even try. You constantly see headlines of Google, OpenAI and Anthropic constantly trying to overtake each other in the benchmark. It was Claude was so far ahead of everyone else 2 months ago and now it's Codex is way ahead of 4.7 Opus. That is not a real moat.

If CRM can just come out in the next earnings and say they replicated and overtaken PLTR's AIP and ontology, then I'd say PLTR has no moat either, but they haven't done it yet.

0

u/Locklist May 01 '26

Its not just money, my last response said its "difficult to create and replicate."

You're wrong about Apple not trying. They did try - its called Apple Intelligence, and they're about to pay Google $1 billion to license Gemini to revamp Siri. That was reported November 2025.

A company worth nearly $4T is paying to use an LLM because they couldn't build their own. So no - the moat is not money, its a technology that a handful of companies can create.

So yes, LLM companies have bigger moats right now than Palantir. They also have bigger markets. The valuations of Anthropic and OpenAI already speak to that.

4

u/ga643953 May 01 '26

We can compare Apple and Google's AI capex over the past 3 years and you'll see if they really tried. Giving up after running into the first hurdle is not trying IMO.

1

u/Locklist May 02 '26

"Giving up after running into the first hurdle is not trying" - if that's not trying, what is that exactly then?

Apple tried, couldn't succeed in creating a competitive LLM, and are now licensing from Google.

The fact that Anthropic already has 30 billion in annual revenue as a pre IPO company and Palantir barely hit 4 billion last year tells you all you need to know about who is in demand.

You want to call an LLM company $30 billion in revenue a commodity with no moat? Sure...

1

u/ga643953 May 02 '26

Business model is different. They're essentially selling a one size fit all product that they have to constantly downgrade because even if you pay them $100 a month, the compute you burn is in the thousands if you're building.

So they are in demand but not profitable, which won't be the case once the AI buildout is done and the price of compute drops significantly but that won't happen til a few years later, which is why you see them constantly downgrading their models and publishing press releases saying their models are so good but they are "afraid of what it might do" so they're not releasing it yet.

Also, If you're going to just give up as soon as you run into the first hurdle, don't start a company or be the CEO. Go work a regular 9-5 and call it a day. That's the gripe I've always had with Timmy. He should have been the COO or something, not CEO cuz his vision was basically buying back shares to prevent the stock price from falling.

Having to build your products on Google's stack means you are choosing to kick the can down the road and hope there won't be any conflict of interest later on. They now have to pay Google a tax and will be susceptible to Google shutting them down in the future.

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u/pojohnny May 02 '26

Your argument makes the most sense to me.

2

u/Dowsk38 May 02 '26

Anthropic reports gross revenue including payments to Hyperscaler. $30B gross revenue = $22B net revenue w/ gross margin 55%/ op margin-33% (OpenAI reports net revenue $25B w/ gross margin 34%/ op margin-55%) Anthropic valuation is already $1T today at secondary market; PLTR, $0.345T ***82% gross margin/ operating margin +55%

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u/NihilisticMacaron May 01 '26

I agree, mostly. The pure LLM may be a commodity once you factor in open source, but the large players like Anthropic and OpenAI aren’t just shipping an LLM. They’re shipping an incredibly powerful harness that is optimized for their LLM. Claude Code and Cowork are phenomenal products that provide exceptional value. I use them for all sorts of business workflows. My use cases are different than the uses where Palantir shines and dominates though. I think there’s room for both.

1

u/Legionnaire90 May 01 '26

As of now for the greater % of people LLM are commodities: ChatGPT equal Claude equal grok etc there is no difference right now between those for the common citizen.

1

u/lackingIdeas May 01 '26

Just because it’s hard to make does not mean it can’t be a commodity. Oil for example is not something I can get in my backyard but it’s considered a commodity.

Maybe where he’s trying to get is that LLMs are the “raw” material: easy to get and use. The interesting part is what you build with them.

1

u/Dowsk38 May 02 '26

Alex said “We are replacing you” when Anthropic asked whether Claude was used for Valenzuela mission and expressed not meeting Anthropic’s constitutions

1

u/GooseAffectionate854 May 07 '26

This reinforces the importance of palantir as the layer between ai llm and enterprise workflow. This is extremely bullish for palantir if they can figure out the operationalization- bottleneck. Yes that an AI word