The AI landscape is evolving rapidly and not all startups are expected to thrive in the coming years. A senior executive at Google, Darren Mowry, has highlighted that two particular business models in the generative AI space face significant challenges. The first group includes companies that act as wrappers around existing large language models, offering simple interfaces without developing their own proprietary technology. These startups rely heavily on third party models and risk being overtaken as major AI providers integrate similar features directly into their platforms.
The second group comprises AI aggregators that combine multiple models into a single interface but do not contribute meaningful innovation. Customers increasingly seek solutions with built in intellectual property rather than platforms that simply route queries between models. Mowry emphasized that startups must focus on building real competitive advantages through proprietary datasets, domain expertise, or specialized workflows
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