The Era of Vertical AI Models

From the video description

Analysis contrasts Sutton's Bitter Lesson with a rising era of vertical AI models trained on last-mile interaction data, exemplified by Intercom's Apex and Cursor's Composer Two. Post-training on proprietary interaction datasets and reinforcement learning on curated quality data can elevate open-weight base models to meet or exceed frontier-model performance for specific tasks. Resulting effects include model speciation, a shift to in-house fine-tuning on open models, erosion of API-based moats, and a renewed premium on proprietary evaluation data.