GPT-4.5 And Claude 3.7 Are Out...Here's Our Verdict

The landscape of advanced AI models has seen significant movement in recent weeks with OpenAI launching GPT-4.5 and Anthropic releasing Claude 3.7 Sonnet. While both companies tout their latest iterations as substantial improvements, a closer examination reveals a more nuanced picture that e-commerce businesses and Amazon sellers should consider before rushing to adopt these technologies.

OpenAI's GPT-4.5: Incremental Gains at Premium Costs

OpenAI has positioned GPT-4.5 as its "most knowledgeable model yet," promising better writing capabilities, improved world knowledge, and what they describe as a "refined personality." The company claims interactions with the model will feel more "natural," suggesting enhanced capabilities in pattern recognition and drawing connections—ostensibly valuable for content creation, programming, and problem-solving.

However, OpenAI's own internal documentation that leaked ahead of the announcement revealed a more tempered assessment. The company initially acknowledged that "GPT-4.5 is not a frontier model," noting that "its performance is below that of o1, o3-mini, and deep research on most preparedness evaluations." This language was subsequently removed from updated documentation, raising questions about how the company is positioning the product.

The improvements, while real, appear to be incremental rather than transformative. Former OpenAI researcher Andrej Karpathy explained that GPT-4.5 required ten times more computational resources for what he described as "diffuse" improvements—subtle enhancements that many users might struggle to perceive as meaningful advances.

Perhaps most concerning is GPT-4.5's cost structure. Priced at $75 per million tokens for input and $150 per million tokens for output—approximately 10-25 times more expensive than competing offerings—the model faces serious adoption challenges for businesses operating on tight margins.

Industry estimates suggest GPT-4.5 cost approximately $500 million to train, highlighting the massive investment required for what appears to be relatively modest performance improvements. OpenAI CEO Sam Altman acknowledged these challenges on social media, calling GPT-4.5 "a giant, expensive model" that "won't crush benchmarks."

Anthropic's Claude 3.7 Sonnet: A Different Approach to Reasoning

In contrast, Anthropic has taken a different path with Claude 3.7 Sonnet, focusing on what it calls "hybrid reasoning." The model can switch between quick responses and an "extended thinking" mode that walks through problems step-by-step, similar to human reasoning.

According to Anthropic, this approach reflects a philosophy that "reasoning is simply one of the capabilities a frontier model should have, rather than something to be provided in a separate model." The standard version of Claude 3.7 Sonnet is available for free, while the extended thinking mode requires a Pro subscription at $20 per month.

In practical testing, Claude's extended thinking mode demonstrated both strengths and limitations. For creative tasks, such as poetry writing, the extended thinking allowed the model to explore multiple approaches, consider alternatives, and produce more refined results. When asked to write a poem about AI sentience, Claude 3.7's extended thinking mode brainstormed seven different metaphors before settling on the most suitable one, resulting in a more layered and thoughtful poem than those produced by competitors.

However, for straightforward logical reasoning, such as solving riddles, the extended thinking sometimes appeared to be a hindrance rather than a help. While OpenAI's ChatGPT o1 model could quickly arrive at the correct answer to a riddle in six seconds, Claude's extended thinking mode took nearly a minute, working through multiple possibilities before reaching the same conclusion.

On benchmark tests, Anthropic claims Claude 3.7 Sonnet outperforms competitors on real-world software engineering tasks, scoring 62.3% accuracy on the SWE benchmark compared to OpenAI's o3-mini model at 49.3%.

The AI Angle for E-commerce Businesses

For e-commerce operators and Amazon sellers, these developments present both opportunities and challenges. The improved writing capabilities and reduced hallucinations in both models could enhance product descriptions, customer service interactions, and marketing copy. However, the practical question remains whether these improvements justify the associated costs.

GPT-4.5's prohibitive pricing makes it impractical for most operational use cases in e-commerce, particularly for businesses operating with tight margins. Claude 3.7 Sonnet offers a more accessible pricing model, but businesses must weigh whether the extended thinking capabilities provide enough value for their specific needs.

The more prudent approach for most sellers may be to leverage more cost-effective models or to be selective about which premium features truly deliver business value. For tasks requiring creative content generation or complex problem-solving, Claude's extended thinking mode might prove worthwhile. For more straightforward applications requiring quick, accurate responses, simpler and less expensive models may be sufficient.

Market Implications and Investment Outlook

The timing of GPT-4.5's release coincided with a notable sell-off in NVIDIA stock, reflecting investor concerns about the future of AI infrastructure investment. If increasingly expensive models deliver only marginal improvements, the justification for continued massive capital expenditure becomes tenuous.

This cost-benefit imbalance raises fundamental questions about the sustainability of the current AI scaling approach. As AI researcher Gary Marcus noted regarding GPT-4.5, the release provides evidence that "scaling data and compute is not a physical law"—suggesting there may be diminishing returns on investment as models grow larger.

While Anthropic's approach with Claude 3.7 Sonnet takes a somewhat different direction by focusing on reasoning capabilities rather than sheer size, it too must ultimately demonstrate tangible business value to justify adoption.

Looking Forward

OpenAI's roadmap suggests GPT-5 could arrive as soon as late May, incorporating the company's new o3 reasoning model. This positions GPT-4.5 as a transitional release while the company works toward more ambitious goals.

Anthropic, meanwhile, appears to be focusing on making AI reasoning more accessible and integrated directly into its main models rather than offering it as a separate capability.

For e-commerce businesses, the key takeaway is measured pragmatism. While AI will continue to transform online retail, the path forward requires careful assessment of specific business needs against the economic realities of these increasingly sophisticated systems.

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• Anthropic debuts Claude 3.7 Sonnet, a hybrid reasoning AI with improved coding capabilities, and introduces Claude Code for AI-powered software development.

• Amazon introduces Alexa+, a more conversational, personalized AI assistant with agentic capabilities, smart home integration, and deep knowledge, free for Prime members.

• Google Lens now enables on-screen visual search for iPhone users in Chrome and the Google app, while AI Overviews enhance search results for unique images, rolling out globally.

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