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Welcome everyone to another exciting episode of Dynamics Corner.
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What is Local LLMs DeepSeek Vy4?
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I'm your co-host, chris.
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And this is Brad.
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This episode was recorded on February 20th 2025.
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Chris, chris, chris.
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Local language models.
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Local large language models.
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Is that what that?
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means.
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Yes.
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This was another mind blowing conversation.
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In this conversation, we learned about large language models running large language models locally what are all of these models and how we can communicate with these models, with Business Central With us today, we had the opportunity to learn about many things.
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Ai with Stefano D'Amelio.
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Good morning Good afternoon.
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Good morning for me.
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Good morning for me Good night.
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Good morning for me, good night, good afternoon for you.
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It feels like nighttime here, but it's early morning, it always feels like nighttime here.
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I always forgot the time zone.
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Yes, you are early morning.
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Well, you are six hours ahead of me, okay, and then nine hours ahead of chris okay, so perfect.
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So, yeah, it is, it's perfect.
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It's perfect for me because it's not nighttime, it's perfect for you because it's late.
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Yeah, exactly, it's perfect for chris because it's very early so it's perfect for everybody.
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It's normal that I have an uploading uh message on top yeah, yes, yes, yes it it collects the local audio and video so that we have some high quality files to put together to make you sound amazing.
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But you already sound amazing.
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No, not too much you are amazing with your podcast.
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Yeah, thank you we're only amazing because of individuals like you.
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And what's the greeting in Italy?
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It's not ciao, it's how do you say?
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You know, usually we'll say good morning.
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Hello, we say ciao or no.
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We usually use ciao, it's the standard.
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Buongiorno.
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Buongiorno.
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Buongiorno is another way, ciao is more informal.
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Ok, and then when you say bye, do you say arrivederci?
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or ciao again, arrivederci exactly you speak.
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Italian perfectly, I'm ready to go to Italy.
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I'm ready to go to Italy.
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Still haven't made it over to Europe.
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It's a struggle, but hopefully this year I'll be able to make, I'll be able to make one of the appearances over there, one of the conferences out there it's always a challenge one of the next European conferences yes, yes, there's several coming up.
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It's a matter of trying to find the one that works out best logistically.
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Yeah, I agree.
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It's not always easy to balance every event that there's outside, so balance events, working family and so on is not easy.
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No, it's not easy In Europe we spoke about before, I think casually, europe is like the United States in the sense that, oh, excuse me, the United States in itself is like Europe, where you have the United States as a large continent or a large country, excuse me and it has many states In Europe Now, probably one more If you join Canada.
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Don't even get me started on that, I don't want Canada.
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If you join Canada, don't even get me started on that, I don't want Canada.
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They can keep Canada.
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Let's give Canada to somebody else.
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But we travel in the United States across states, like Europeans travel across countries.
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So when there's European conferences it's a little bit easier for you to move around.
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I understand.
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Also, for you to come over to the United States it's a little difficult because you understand, in essence it's a day of travel somewhere and then you have to attend a conference or do something, then a day of travel back.
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So you don't usually do something like that without trying to get additional time to do yeah it's easier for you though because you're east coast.
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If you're flying east coast to europe, it's it's a much shorter flight, like for me.
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I have to cross the country, yeah, and then go the other way I remember when I was in the us, uh, some years ago, from los Los Angeles to moving to New York.
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It was about, if I remember, four or five hours of flight, something like that?
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Yeah, some of the flights, like you said.
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Yeah, this is about five to six hours, depending on where on the East Coast that you go, so that is just itself going one side to the other.
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It's a little challenging, chris, it becomes.
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Which airport do you go to?
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Yeah, and Europe is fortunate that they have a great rail system because you can go from country to country easily.
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And.
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I often forget that, so I see some of these events.
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I was talking with someone they said they were recommending if I wanted to go to one of the events, we'll fly to this airport.
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You could probably get a direct flight.
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Then you can take a train easily for a few hours to get to the destination, which was much shorter, when I looked at it, than flying oh yeah, for sure, to an airport and having the connections yeah, they do have good.
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You do have good transportation.
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Ours is like a greyhound bus, but that takes like forever to get around.
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I wish I do wish we had a better transit system.
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Some of the cities have great transit systems.
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Boston has a subway and they have some rail, exactly.
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And then New York has it used to be a good system, but now, from my understanding, it's a disaster.
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You avoid it.
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There's ways that you can get around, uh, but if you want to go from boston to florida, for example, you can take a train, but the train will take you a day and it's so it's it's challenging it's challenging but thank you for taking the time to speak with us.
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I've been looking forward to speaking with you about a topic that is interesting to most people these days, even more so, I think, in the development point of view.
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But before we jump into it, can you tell everyone a little bit about yourself?
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A little bit about myself.
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My name is Stefano.
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I'm working mainly in the business central area and in the Azure area, so this is the topic that I cover.
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In my company.
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I am responsible for all the development team inside my group.
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My group is called Lodestar and we are quite a large group in Italy and I have the responsibility of managing the development part of business central area and the Azure area, so serverless applications and so on.
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Recently, as you can imagine, we have also started working on the AI staff, and so I'm currently also leading it at the moment small, but I hope that we will grow team that is involved on providing also AI solutions to the customers.
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I have a long history from in business central area, previously NIV.
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I started in NIV I in version 2.1, navision when it was NaVision 2.1.
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Then it was acquired by Microsoft and so on.
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So I follow all the roadmap of this product and now we are here.
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We are in the cloud.
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So there was lots of evolution in the product, lots of steps and there really was.
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I.
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One day we'll have to sit down with a few people that have been working with it as long as you have and just talk about the evolution of the product from where it was, back with the classic client, with the native database that they had, then when they added SQL, then when they added the roll-tailed client, you know, continue through the progression of the evolution of both the product and the language.
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And I said it before, originally they had three versions, if you recall.
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They had the financials version, the distribution version and the manufacturing version.
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So depending on which customer type you were, you would get a specific version of.
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Navision and that was Navision has had a lot of evolutions in the years.
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I remember we started with the classic client and the native database, so this was extremely fast, so very, very great on that, with a lot of limitations probably when going to big customers and unfortunately we started.
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My first Navision project in my life was with a very big customer because we decided to move to Navision and all the healthcare system that we have and we historically in my company we have an healthcare dedicated sector and we have a solution, previously handmade solution based on Oracle database.
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In years, two or three years before the introduction of the euros, we decided to move this solution, solution to Navision classic database, because it was only possible this solution had, if I remember four or five hundred users and it was a very big solution.
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And then we moved to SQL Server.
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When we moved to SQL Server from classic, there was a lot of problem conversion of data and something like that but the solution is still live and the curious part of that is that we are in 2025, we'll be the central line and so on, but we have also today customers that are using the old Navision, converted to NAV 2009,.
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But we have still today live customers and also big customers that are still on the platform.
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We are trying to convince them.
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Wow.
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Is that it?
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I know of a customer as well that's using Nav 2009, and I think they have close to 400 users and they haven't decided to make a move.
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The curious part of that.
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What sometimes makes me crazy is that in my everyday job at office, maybe during the day, I need to switch from yes Code, iel language and so on to OpenClassicLine and IV2009 to fix something or to add something.
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So also today we need to switch from totally different.
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Wow, it is interesting to see the difference and, as you had mentioned, you get used to working with AL and VS Code and all the tools that you have within VS Code, all the things that were added, and you go back to 2009,.
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You see what we really had to do to do code, even when they added the separation for functions.
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It was a big deal for me that they had the gray bar where you could separate between the functions, which was an even fine reference.
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It was good.
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Also, I didn't get a chance to speak with you in person.
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I know we've communicated with text and written, but congratulations on the book that you and Julio put out.
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It's a great book.
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I did pick it up.
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I have it.
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Yeah, we have worked quite a lot on that.
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So we hope that I can only imagine.
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I can only imagine.
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We receive a lot of positive feedback from the community Very useful.
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It's very useful.
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It is on my shelf.
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I have it right behind me.
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Yes yes so it's uh, I have it as well no, so, uh, thank you for doing that and creating that and congratulations on putting together something so informative, uh for users.
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But now let's jump into this llm stuff.
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Yeah, because you have been doing some things that I don't know, if I can say I understand or don't understand, but anytime I see something that you post, you're always doing something new with local language, large language models, but you're also doing a lot locally, exactly.
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I see so you're installing and setting up AI or language models on your computer.
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Yes, your local machine.
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Wow, exactly, computer.
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Yes, your local machine.
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Wow, exactly uh what we have uh, but I think that everyone that is following uh technology information uh today on socials or on internet or something like that.
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You everywhere read about ai, uh, ai is a topic that is absolutely exploding and uh there are.
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I don't think you can go five minutes without hearing it Exactly.
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I really don't, except when you're sleeping, I think, even maybe what you're talking about.
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If you're listening to the news, if you're having a conversation with someone at work, if you're reading something online, I think you can't go five minutes unless you, like you had mentioned, Chris unless you're sleeping or you just are sitting by yourself in the woods somewhere without hearing AI Exactly.
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And I totally agree.
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And the history about my these stuffs that I'm doing today is I think that the majority of us knows that the big AI vendors like OpenAI, microsoft, google, something like that so these are now also Twitter or X sorry, not Twitter X Grok, as we recently released Grok3, that is extremely powerful.
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So the concept that we embraced some years ago is that we start providing AI solutions by using standard AI models.
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So Azure, openai was our first choice, and this was absolutely easy to do.
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Just go on Azure, set up a model, deploy.
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Deploy a model and then you can use your model in business central or in different applications you want to use.
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We.
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We have some problems on that, so on on some scenarios, and the problem of that is that sometimes, when is it not easy to provide and convince customers that an AI solution is something that can be a winning choice for them?
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So you need to demonstrate something, and some customers also are not so prone to leave your data accessible to internet or maybe have some devices, particular devices.
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We have, for example, scenarios in manufactories where they cannot access internet or don't want to access internet for different reasons, or cannot access the browser, for example.
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This was another limitation no browser as the way to interact.
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And so for that reason, this was one of the reasons that turned me the light to start exploring something different.
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And the second reason for that was that there are a lot of scenarios at least in my experience lot of scenarios where AI can be useful, but for these scenarios is not absolutely needed the full power of a giant LLM.
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For example, why I need to pay for I don't know GPT-4A when I only need small staffs or I only need to do function calling or something like that.
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Sometimes AI for a big company can be costly for probably nothing.
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For a big company can be costly for probably nothing, and it's not absolutely not always choosing the best performance LLM is gives an advantage to the final customer.
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So, with these reasons, I started exploring a new world, that is, the open source LLMs, because it's probably a world that is not so spread everywhere.
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But the AI world is also full of open source LLMs, and these open source LLMs are also provided by big vendors like Microsoft is providing open source LLMs, google is providing open source LLMs, meta Lama and more.
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So DeepSeek is also provided as an open LLM.
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These LLM these LLM are, in many scenarios absolutely powerful can be executed offline and sometimes can give the same result to the customers as using one of the full version that you have available in OpenAI or Azure, openai or X or something like that, giving absolutely the same results but without going to internet, without totally private, and so on.
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So that's why I started exploring this world.
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My mind is full of questions.
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So you're working with open source LLMs to run AI locally, the language models locally, versus running them online.
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I have several questions.
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With that One we'll get to.
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How do you set all that up, but we'll talk about that after.
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How do you determine the differences between the models that you choose to use, which they and you had mentioned some of the big names that we hear of outside of the open source ones, with microsoft, with google, with meta and now XAI how do you know which model to use, or what's the difference between the models?
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Because I see, like the GPT-4.0, grok 3, grok 2, Cloud, sonnet 3.5.
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I see all these different language models and how do you know what the difference is between them?
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Or is?
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it just all the same, and it's a different name based upon who creates it.
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Are they created equal?
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No, if I can try to share a screen, if possible, so that we can.
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Yes, that would be wonderful.
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We can talk probably now.
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Very cool Excellent.
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I'm excited about this.
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I'm excited.
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There's some cool stuff on your screen with graphs moving.
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And you're a Mac user.
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But now it's working.
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Sorry for the problem, but I don't know why no one will know, so we can see your screen.
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You have a window open with some graphs and some things moving.
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Yes, what?
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I will start first showing is this, this window.
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So Hugging Face.
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Hugging Face is one of the main, probably probably one of the main portals and platforms where open source LLMs are distributed from all the different vendors, and so every vendor that wants to distribute an AI model today in the open source world release on AgingFace and on AgingFace you can see, if you click on models, you can see that here there are tons of models deployed here.
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Some are models completely open source, models like and not very known models like, as you can see, a lot of names that are not so famous.
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But there are models that instead are extremely famous and they have also their counterpart that is not open source and is released as a paid service, like, for example, probably one of the most famous today is DeepSeq.
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Deepseq is a very powerful model.
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Deepseq, as the full DeepSeq model, is a big model with 671 billions of parameters, so it's a very extreme large model that, in order to be executed locally, requires more than 400 gigabytes of RAM.
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Wow.
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So you need 400 gig of RAM to run this locally.
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Wow.
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That was one of my questions.
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The hardware requirements.
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Well, you have a large model that is run online, such as DeepSeek and the ones that we had mentioned.
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That was the first question I had is if you want to run these locally, what are the requirements that you have to run them locally, Because I don't know of many people that have a 400 gig of RAM computer?
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people that have a 400 gig of ram computer.
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It's uh, it's something that uh you cannot execute uh in a local, uh local machine, but here for uh open source model, that's uh an important concept to understand.
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That is called quantization.
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So quantization is, in simple terms, is a technique that an LLM vendor can use to reduce the computational and memory cost requirements of a model.
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So in try to explain that in simple terms, is like starting from a full power LLM.
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So an LLM that is provided by the vendor cannot be executed online because it requires a data center in order to be executed.
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These models pass through a process that reduces the precision of the model, so can reduce the floating point required representation of that models.
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So it's something like compressing that model and create from that model a smallest model with the same capacity but with less precision.
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That's the idea.
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So you start from a giant.
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You can detach smaller children of that giant with a bit of smaller precision.
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But smaller precision doesn't mean precision in terms of responses or in terms of capacity.
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It's something like reducing the neural network inside that model.
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So if you can see here, for example, without going to mathematical concept, because quantization is honestly a mathematical concept, if you can see here this is the full DeepSeq model 671 billion of parameters.
00:25:32.435 --> 00:25:49.751
These models cannot be executed offline unless you have a cluster of machines, because it requires not less than 400 gigabytes of RAMs and GPUs in order to be executed online.
00:25:49.751 --> 00:26:01.548
So I cannot execute it offline and probably you cannot execute it offline in your machines and probably also many of them, Unless you got a data center there, Brad somewhere.
00:26:02.963 --> 00:26:05.509
It's under my desk.
00:26:05.509 --> 00:26:15.525
This is why these models are provided as services from the cloud, so you can execute, activate a subscription to DeepSeq or deploy DeepSeq today.
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Also on Azure.
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It's available on Azure AI Foundry.
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You can deploy the full DeepSeq and you can use as services.
00:26:23.367 --> 00:26:27.778
But here you can use as services.
00:26:27.778 --> 00:26:35.148
But here you can see that also there are available the distilled models and that distilled models are a reduced version of DeepSeq in this case.
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So models that are passed through a process called quantizations and through a second process in this case, from the case of DeepSeq called quantizations, and through a second process in this case from the case of DeepSeq called distillations.
00:26:51.199 --> 00:27:03.770
And distillation, as you can see here is another technique that is using open source AI.
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So the distillation is a machine learning technique that involves transferring knowledge from a large model to a smaller one in order to create a model that has the same features and knowledge of the big but of the medium.
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In this case, dpsic transfer it to a smaller model.
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So in this case you can see that here DPSIC is providing several distillation of DPSIC, so it's coming from these models.
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These are the base model that is used to.
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Deepseq has trained this model in order to have a new model called with these names, ah.
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It's a voluntary model.
00:27:59.284 --> 00:28:09.142
So with this process, just to take it back, so in the cloud, they have a model that has billions of parameters, as you had mentioned.
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They go through a distillation process and they reduce it so that it can run locally on a reasonable machine.
00:28:16.746 --> 00:28:24.568
Exactly, you said that the precision is off, is there a difference in the results?
00:28:24.568 --> 00:28:27.086
What's the difference with them?
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Reducing it versus running it in the cloud?
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Is it speed in response?
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Is it accuracy?
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I don't even want to use the word accuracy.
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The main difference that you can experience on some scenarios is probably accuracy, because the full model has obviously more parameters, so accuracy is sometimes at least not always but for some tasks accuracy is probably better.
00:29:00.789 --> 00:29:33.886
If you have followed some of the posts that I have done, I've done, for example, some tests on auto-generating JavaScript complex scripts for creating animations or something like that, and for, for example, these tasks, probably the full model is more accurate With the distilled model, so the local model is less accurate With the distilled model, so the local model is a bit less accurate and you need to more turn up the prompt in order to have the same result.