> "Sort a list" doesn't exist by itself. It isn't a terminal goal - it's a step towards something else.

Sometimes it is. But that is also irrelevant. Replace "sort a list" with any given goal and the argument remains the same.

> The saturation of low end feeds the value into the high end.

But that process is not immediate. There's a reason I was careful to include "at any given time" in my comment.

For the purpose of whether or not a frontier lab is a good investment, it doesn't necessarily help them if there is an ever rising demand for intelligence if their market is eaten from below just as fast by cheaper models from competitors catching up.

It could be they manage to out-pace their competitors sufficiently that they will produce returns high enough to justify their valuations.

But irrespective of whether the demand for more and more intelligence continues to rise perpetually if 2nd tier labs hollows out the bottom of their market fast enough, it could equally be that most of the market ends up being low-margin, highly-competitive inference that won't justify their valuations.

Given the size of their valuations, even if they turn out to be tremendously profitable businesses, it's still not a given they'll give a good return on investment for investors getting in now.

I'm not saying they won't. I'm saying we can't easily judge that based on just assuming growth at the high end will continue without understanding what their moat is likely to look like.