Vendor Lock In: Good for Geese, Bad for Other Birds
December 21, 2023
This essay is the work of a dumb dinobaby. No smart software required.
TechCrunch examines the details behind the recent OpenAI CEO exodus and why vendors are projecting a clear and present danger to tech startups: “OpenAI Mess Exposes The Dangers Of Vendor Lock-In For Start-Ups.” When startups fundraise for seed capital, they attract investors that can influence the company’s future.
OpenAI’s leaders, including ex-CEO Sam Altman and cofounder Greg Brockman, accepted investments from Microsoft. This forced OpenAI into a vendor lock-in situation, where they relied on Microsoft as their business model and vendor of OpenAI products. While there are many large language model products on the market, ChatGPT 3.5 and 4 were touted as the best product on the market. It’s in no small part to Microsoft’s investment and association with the respected and powerful tech company.
As Sam Altman and his OpenAI friends head to Microsoft, it points to the importance of diversifying a company’s vendor portfolio. While ChatGPT was the most popular solution, many tech experts believe that it’s better to research all options instead of relying on one service:
“The companies that chose a flexible approach over depending on a single AI model vendor must be feeling pretty good today. If there is any object lesson to be learned from all this, even as the drama continues to play out in real time, it’s that it’s never, ever a good idea to go with a single vendor.
Founders who put all of their eggs in the OpenAI basket now find themselves suddenly in a very uncomfortable situation, as the uncertainty around OpenAI continues to swirl.”
This is what happens when you rely on one vendor to supply all technology and related services. It’s always best to research and have multiple backup options in case one doesn’t work out.
Whitney Grace, December 21, 2023
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