Fal wants to sell compute, and since they're straggling behind the compute-as-an-API leaders they've attached their cart to the art, image, and video subset of the market.
They think they've got a leg up on their model partners. That the foundation model companies will mostly become generic copies of one another, servants of the compute layer. There are so many foundation video models now, and they'll battle it out over dwindling margins. Pika, Runway, Kling - they're all the same. And there's also growing open source foundation models.
The thing that stands in Fal's way is that the future of AI video for artists is local. Hunyuan and Comfy can run on desktop machines, and real artists hate the SaaS model and non local stuff. It doesn't look like we'll even need A100s to reach Pixar levels of quality.
The ones to watch in the art space are Comfy and Invoke. And Adobe.
Fal probably has a future in powering the API-driven YouTube Shorts slop, though there's probably an upper limit to the number of talking head startups.
But there's no way they win artists over to cloud. Sophisticated tools are going to be local. Any SaaS art tools that do achieve escape velocity will buy and manage their own compute and won't go through Fal as a reseller.
Call me thick, but it's like back in the day, rich bored person goes to an artist and says "paint me this and that". Except now the "rich" person calls themselves an artist and "actual" artist is replaced by AI contraption that basically regurgitates real artist works. It's kind of comical.
But also makes sense. If you wanted e.g. music, you could either look at catalogue of what's out there or try to make your own. But if no one is making what tickles you and you yourself have no talent to make what you would like to listen, the AI comes to rescue.
People don't want to watch two chess computers play even if they can both smoke Magnus Carlsen.
Art is an even more extreme version of this. Part of what makes a Dali painting a Dali painting is the mimetic desire of the general weirdness of the human Salvador Dalí.
AI can't displace human mimetic desire. AI art is just worthless muzak playing in the background at Dennys. Non-artistic/non-creative people right now are amazed at how they can make muzak but muzak is shit by its very nature.
I'm an engineer, filmmaker, and DiT researcher. I know thousands of people in this community and organize local AI film meetups and festivals. I've talked with decision makers from 100 person marketing firms all the way up to Disney execs and the CTO of Pixar.
You don't know.
Midjourney might have tons of revenue for being the first mover, but they're busy building VR headsets and generative world models for their metaverse thing.
Meanwhile everyone who is using these models for work - ie, making money with these tools - is clamoring for local execution and deep controllability. Midjourney won't give them that.
The top AI studios are all building on Comfy.
Don't write off Topaz, either. It's the last stage in the pipeline for everyone's workflow.
Stable Diffusion came before Midjourney. What first mover advantage?
Flux has been around almost a year, by your reasoning everyone should have switched. They didn't. Everyone who used Midjourney a year ago is still using it.
The Midjourney sub on reddit has 1.6M subs. The Stable Diffusion sub has 600k.
I don't care what AI studios you know want to use. They use Premier Pro. Just like every film school in America does. Despite plenty of open source alternatives.
90% of people don't give a shit about running locally as long as it's high quality, easy to use and not expensive. And that's exactly why Midjourney is dominating.
Oh, and Runway is projecting to hit $150M in ARR this year.
And you're also underestimating how many billions of images have been generated with Flux. The marginal cost and value of these models will trend towards zero.
> The Midjourney sub on reddit has 1.6M subs. The Stable Diffusion sub has 600k.
So you're saying that they're within the same order of magnitude?
> I don't care what AI studios you know want to use. They use Premier Pro. Just like every film school in America does. Despite plenty of open source alternatives.
Premiere is local software. There's also Final Cut and lots of other alternatives. They're not using CapCut to edit their films.
We're also super early in this game. You're mentioning 20+ year old mature software.
> 90% of people don't give a shit about running locally as long as it's high quality, easy to use and not expensive.
They absolutely do care.
Right now 9 out of 10 generations are garbage, and that's being generous.
> Oh, and Runway is projecting to hit $150M in ARR this year.
That's a really ambitious target they set for themselves, and I think they're getting ahead of things. The field is full of much better competition now.
They also failed to raise their ambitious last round. They've raised too much and have too high a valuation, meanwhile smaller companies have caught up.
That's fair. But I know a lot of smart folks out there that have trouble building that "thin layer of UI". So if that helps them, mission accomplished.
Anyone can replace the AI layer with their own local models, other services... whatever suits your use case and preferences is fair game.
