Maybe they should rename the company 'ClosedAI' ;)

Distillation, as you've eloquently explained it seems like the future. OpenAI need VC money just to keep the lights on as it costs them so much to run a data centre and customers aren't willing to pay for it. They will never see a return on that investment.

Companies will naturally keep reducing the LLM size until they run on-device cutting out the server costs entirely. I imagine Microsoft would kill for a Co-Pilot that ran entirely on-PC and was built into Windows.