> ...like saying Microsoft has no moat for spreadsheets
Which would be very inaccurate as network-effects are Excel's (and Word's) moat. Excel being bundled with Office and Windows helped, but it beat Lotus-123 by being a superior product at a time the computing landscape was changing. OpenAI has no such advantage yet: a text-based API is about as commoditized as a technology can get and OpenAI is furiously launching interfaces with lower interoperability (where one can't replace GPT-4o with Claude 3.5 via a drop-down)
> OpenAI has no such advantage yet: a text-based API is about as commoditized as a technology
It has branding, for most people AI is ChatGpt. Once you reach critical mass, getting people to switch becomes difficult if your product is good enough and most people are happy.
Branding is a very weak moat outside fashion industry and similar places - outside visible status symbols. It's a relatively strong moat for clothes, watches, even things like the iPhone.
But for things you do alone at home, this quickly goes away. Uber is a strong brand, everyone associated non-taxi taxis with Uber. When Bolt came around in much of Europe, and offered the same service with better wait times (they were paying drivers more, so lots of drivers switched), people moved over to Bolt in droves.
> Branding is a very weak moat outside fashion industry and similar places - outside visible status symbols.
Have you tried getting someone to switch from Chrome to Firefox?
UI is basically the same, the product is more performant (faster load, easy to disable all ads, etc). But the moat is how resistant a normal user is to switch from the thing they've used without having to think about it, to the new thing.
I can definitely see the ChatGPT app becoming as "sticky" as Chrome.
First of all, that's not branding, it's bias for a known, existing solution.
Second of all, people have switched browsers en masse before, it just requires a good enough reason to do so. People switched from IE6 to Firefox in a relatively large number, and then they all switched to Chrome. Even today, people on Windows tend to install Chrome, while people on Macs tend to stick to Safari, so some browser choice is happening.
Third of all, and perhaps most importantly really, Chrome is free, so the only reason to switch away would be finding some major features you want in another browser. ChatGPT is not free, and it's losing money fast at its current price point. But if they make it more expensive, as they need to unless they can significantly reduce their costs, people will look for alternatives. Other than fashion brands, I don't think you'll find almost any example of people in general using a more expensive service when a cheaper equivalent one exists and is being actively marketed.
Which would be very inaccurate as network-effects are Excel's (and Word's) moat. Excel being bundled with Office and Windows helped, but it beat Lotus-123 by being a superior product at a time the computing landscape was changing. OpenAI has no such advantage yet: a text-based API is about as commoditized as a technology can get and OpenAI is furiously launching interfaces with lower interoperability (where one can't replace GPT-4o with Claude 3.5 via a drop-down)