Anthropic faces user backlash over degraded performance in its Claude AI models. Users, including an AMD director, report more errors and failures on complex tasks, labeling it "AI shrinkflation." Anthropic denies "nerfing" its models, attributing changes to new default "effort" settings designed to save tokens. The controversy is fueled by speculation about a compute capacity crunch at the rapidly growing company, which has also experienced recent outages.
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