Frontier AI labs are caught in a 'capex trap' where massive data-center and compute spending forces them into a 'toll road' business model that charges for every use of the model, and this won't survive competition from cheaper open alternatives like Chinese models.

53:50okay, like the governments in most places in the world decided to own it. So now like we have like this interesting story where I think it's kind of clear that Chinese companies, you know, like Deep Seek Moonshot, they're like really not that far behind in LLMs. But if you look at the valuations of these companies at their last round we're talking about I don't know tens of billions like maybe around

54:10like 50 no one is talking about the trillion but like wait a second guys it's like the same underlying tech so what's going on so I think it's we sometimes internally calling like the capex trap these guys spend like so much on the data center so much in compute like raise such a crazy amount of money and creating such an expectations that they just like really try to create a

54:32business model that's a toll road right like that every time that you touch their model you are paying them and uh maybe it could work in the past but giving the the availability of Chinese model I just like don't see how it's going to unfold like that so imagine that in the world of world models we are providing an alternative to people who do not want at all road business models

54:57so we're coming and say listen guys if you are not If you're not hitting $10 million threshold, you can use the model for free. Just like, you know, build something cool, get to some kind of traction, and then we can discuss licensing. Once you're hitting 10 millions of dollars revenue, let's discuss licensing. It can be multi-year deal that's extremely predictable for you so you can manage the cost, etc. And

55:23to me, it's obviously why the big guys don't want to do it because they just like this model is like way way less lucrative economically than to creating a toll road. But our claim is that toll road isn't going to be viable alternative because if you're offering a different business model that's more of the win-win, more and more people going to switch there. And I think like GLM

55:43recently is a great example of that, right? Like once you start edging the capabilities of closed model, then a lot of people suddenly start to think about cost. Um, how do you see this play out with IP holders who to some extent are very scared of uh Google and uh what they might do with their IP? How does this work out for you? Obviously, it's obviously one of the