arXiv:2610.20782v1 Announce Type: new Abstract: The closed world asks AI for specialized competence and lets it manufacture the iid data its theory assumes: a fixed criterion licenses collecting examples until the task is covered. The open world asks for versatility --- taking up tasks a machine was not built for, from few examples and with little prior from a human designer --- and offers data that is grouped, not shuffled. Its tasks are not known in advance, so a machine must do inference-time learning (1st requirement). Modeling tasks as sharing latent factors and decomposing the training objective, we derive two more: a rich representation, retaining more than iid generalization requires, and a predictive disentanglement that aligns inputs and outputs into matched low-dimensional groups. The analysis further predicts the need for a consistent inner learner, and the benefit of long contexts spanning related tasks. We test these claims on language models up to 8B, asking whether a model has a property (qualitative) rather than how much it wins (quantitative). Models that meet the requirements improve as data from related tasks accumulates; the rest degrade, and neither scale nor layer-type interleaving repairs this.
Evaluating Model Capabilities After Benchmark Saturation