Santiago Valdarrama argues foundation model companies won't dominate the AI product layer, pointing to cloud history

Original post

I don't think the companies building the best foundation models will also be the ones that win on the products built on top of them.

Doing both well is really hard. Focus wins.

The cloud is one example: the best products running on AWS, Azure, and GCP came from companies that obsessed over the details and focused solely on their core product.

AI will be the same.

The companies with a real edge are the ones that 1) don't lock themselves into one model and 2) sweat the details.

Customers will always go to whoever makes the "it just works" app.

Fryd Wiatrowski@frydwia

http://x.com/i/article/2070125273790492672

6:32 AM · Jun 25, 2026 · 6.7K Views

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Rohan Paul@rohanpaul_ai

The model alone is no longer the product.

The value is the system that turns a model into reliable action, the harness around the model. Utility per watt.

The big lab may own the model, but @viktor__com is betting that the company closest to the workflow owns the user.

Viktor is making a workflow layer for Slack and Microsoft Teams that connects into 3,000+ tools that Viktor can read and write to. 2 platforms, one AI employee.

Fryd Wiatrowski@frydwia

http://x.com/i/article/2070125273790492672

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Santiago@svpino

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Santiago@svpino

I don't think the companies building the best foundation models will also be the ones that win on the products built on top of them.

Doing both well is really hard. Focus wins.

The cloud is one example: the best products running on AWS, Azure, and GCP came from companies that obsessed over the details and focused solely on their core product.

AI will be the same.

The companies with a real edge are the ones that 1) don't lock themselves into one model and 2) sweat the details.

Customers will always go to whoever makes the "it just works" app.

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Pinkman@pinkman_ai

@svpino The aws example tracks but model labs have way more reach into the product layer than aws ever did into apps built on it

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Kai Benetti@kai_benetti

@svpino the "don't lock into one model" point is the real lesson from this, single model dependency is basically building on rented land

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Ari the Insider@artiinsider

@svpino Amazon didn't build the best apps on top of AWS, third parties did, bcs infrastructure and product excellence require completely different organizational muscles. Model agnostic builders who obsess over UX are going to eat the labs on the application layer

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