The End of the LLMs Gold Rush, the Start of the AI Product Era

If you flip through history, you’ll notice something interesting, so many world-changing ideas started small, quietly, in the background. Nobody paid much attention at first. No headlines, no fanfare. Just someone tinkering away, solving a problem, or following a hunch.

Take Johannes Gutenberg in his cramped workshop, tweaking and carefully tuning his metal type. He inks the letters, presses them to paper, then shrugs. “Well, that’ll save me some time,” he says casually. To him, it’s merely a clever shortcut, a handy little trick, a faster way to reproduce books, nothing earth-shattering. Yet here we are, 600 years later, still running on the operating system he built.

Fast-forward to 1989. A programmer at CERN scribbles on a napkin:
”What if scientists could link their research… like footnotes?” His boss scrawls ”Vague but exciting” on the proposal. That napkin became the World Wide Web , the same one you’re using to watch cat videos and read this article.

The 21st century? Same old story , just with better tech. We’re stacking the bricks of the future, just like every era before us. But this time, the big game-changer isn’t steam engines or the internet, it’s something called large language models (or LLM if you’re into acronyms).

At first, LLMs were just fancy autocomplete neural networks called transformers, trained on oceans of text, learning to mimic how humans write, speak, and reason. They lurked in labs, startups, and open-source projects, quietly getting smarter. No one paid much attention.

Then, November 2022. A single tweet detonated the status quo. Almost overnight, the way we used computers changed forever. If you were there, you probably felt the shift in the air and you probably saw the internet hold its breath.

That tweet came from Sam Altman. It marked the moment OpenAI moved from building in private to reshaping the future in public. History won’t just remember OpenAI as another tetch company. It’ll mark them as the ones who democratized AI, who flipped the switch and launched us into a new era. The before-and-after moment. The Big Bang.

For nearly three years, we’ve watched the AI market expand rapidly with the entry of new players like Anthropic’s Claude, Google’s Gemini, Grok(xAi) Meta’s LLaMA, and Chinese models such as DeepSeek and Qwen, among others.

Yet, we’re now stuck in the world’s most expensive game of déjà vu: every company releases a new model, slaps a shiny benchmark on it, and declares victory. Rinse and repeat. The problem? AI can no longer scale vertically (a topic I’ll explore in my next article). Instead, we’re getting microscopic “upgrades” that nobody outside a research lab would even notice… companies are forced to make minor tweaks slight improvements in reasoning or speed, that the average user hardly notices.

Think about it:

The brutal truth? We’ve hit the ”Who cares?” phase of AI. Speed bumps in reasoning? Slightly better math scores? Most users won’t feel the difference. The hype is fading because the improvements are — let’s face it — boring.

And the worst part? Throwing more money at bigger models isn’t fixing it. We’re not getting another GPT-3 moment; we’re getting incrementalism disguised as innovation and the AI race is no longer about transformative breakthroughs, it’s about selling the illusion of progress through tiny, often imperceptible upgrades.

So if vertical scaling has hit a wall, where does AI go next?

It has become clearer than ever that AI needs a new frontier: moving beyond chatbots and APIs toward tangible, integrated experiences. AI has reached a phase of maturity, its capabilities are strong, but the next leap won’t come from scaling parameters but from rethinking how AI lives in the world: through design, interaction, and physical embodiment.

This may seem like a simple truth, yet many in tech either fail to grasp it or refuse to admit it. OpenAI, however, appears to be an exception. They seem serious about the AI race, driven not just by competition but by a sense of ownership. It’s as if they believe they started this revolution, so they must dominate it and shape the future. And from what I can see, that’s exactly what they’re doing.

About two weeks ago, news broke that OpenAI had acquired Jony Ive’s hardware startup, IO, in a deal valued at $6.5 billion. It’s a striking move, not just because of the price tag, but because of what it represents. Jony Ive, If you’re not familiar with Jony Ive, he is the designer behind some of Apple’s most famous products. He worked closely with Steve Jobs and helped bring the iMac, iPod, iPhone, and iPad to life. Basically, if it looked sleek and futuristic, there’s a good chance he had something to do with it.

Steve Jobs and Jony Ive.

So why would an AI company like OpenAI want to team up with a designer best known for hardware? well actually this acquisition signals a major shift in OpenAI’s direction, from offering AI as a service (like ChatGPT) to building AI as a product. it looks like they’re aiming to take AI beyond the screen. Until now, tools like ChatGPT and Copilot have lived on our devices, we type something and they respond. But this move suggests something different: turning AI into a real-world product you can interact with more naturally.

OpenAI’s acquisition of IO suggests that the next frontier for AI isn’t just in what it can say or do — but how it can live with us. Screens? Keyboards? OpenAI thinks those are relics. The future of AI isn’t about staring at glass or tapping keys, it’s about an intelligence that just _gets_ you. Talk to it. Gesture at it. Maybe it’ll even pick up on your mood before you do. No commands, no interfaces just you, living your life, with AI as your invisible co-pilot.

This isn’t sci-fi. It’s ambient computing. AI dissolved into the world around you, helping without asking. And with Jony Ive (the guy who made your iPhone irresistible) and OpenAI’s brainiacs teaming up, they’re not just building tech. They’re crafting a presence. Something that feels less like a gadget and more like… well, a friend who’s always there but never annoying.

Think about it: What if you never had to “open” an app again? What if AI didn’t live in your phone but in the air around you — responding to your voice, your shrugs, the way you sigh when you’re frustrated? That’s the quiet revolution coming. Not AI you summon, but AI that just _is_.

OpenAI snapping up IO tells you everything. This isn’t just about smarter machines. It’s about machines that fit into human life like they’ve always belonged. The endgame? AI so seamless, you forget it’s there until you realize you can’t remember how you lived without it.

The era of pouring billions into ever-larger language models may be coming to an end.. The next frontier isn’t brute-force intelligence, it’s ambient intelligence. OpenAI’s real bet isn’t on a better chatbot, but on a future where AI dissolves into the background, an always-present companion with no interface at all.

As Naval Ravikant once put it: ”The promise of AI is to have no UI” No screens, no prompts, no friction.. just an invisible layer of assistance, woven into life itself. That’s the true endgame. Not an app you open, but an intelligence that’s already there, quietly listening, anticipating, and acting before you even ask.