Yet another Hacker News

OpenAI and Anthropic cut their LLM prices by up to 80% within a few months. Why?

45 points minimaxir 1 hour ago 60 comments

verdverm 1 hour ago | parent

I fully expect token vendors to go the way of mobile data providers. Increasing throughput and efficiency, yet commoditized and not reaping the massive rewards of the economic gains their technologies enable.

Can't wait for the unlimited plans we will have in due time.

Iolaum 1 hour ago | parent

They will not come. You can only spend so much time speaking on the phone.

But if you get unlimited tokens, with scheduled/automated jobs and subagents you will burn a LOT of money.

verdverm 1 hour ago | parent

Mobile video data and tethered devices would tell a different story. Usage growth has been significant.

I expect they will be "unlimited" in the same sense the mobile / ISPs do that 99% of people never reach the limits.

We could have "unlimited" electricity too, if we choose, by printing solar panels (like the Chinese) and hopefully fusion before long.

ModernMech 1 hour ago | parent

> You can only spend so much time speaking on the phone.

Tell that to my dial up modem as I played Active Worlds in 1996.

boredatoms 1 hour ago | parent

Yeu were still limited to about 4GiB/month usage as a time/bandwidth ceiling

verdverm 23 minutes ago | parent

Not where I am, it's 20G mobile and internet is unlimited, the level below mine has 1Tb cap.

Skunkleton 1 hour ago | parent

"Unlimited" for a consumer will probably take a form like limited parallel agents at max intelligence for X amount of tokens, followed by either single threaded agents or nerfed intelligence or both.

This is the same mechanism used in unlimited mobile internet for example.

cicko 55 minutes ago | parent

I rarely use more than 25% of my subscription's weekly allowance. So, it's already unlimited.

JumpCrisscross 1 hour ago | parent

> if you get unlimited tokens, with scheduled/automated jobs and subagents you will burn a LOT of money

Maybe, maybe not. There could be a saturation point of compute demand from ordinary consumers. (See: hot-water analogy.)

bikvfeee 1 hour ago | parent

> Can't wait for the unlimited plans we will have in due time.

I don't see how this can happen. The cost of serving a model grows linearly with use (energy). The cost of serving a mobile data plan is approximately zero.

verdverm 8 minutes ago | parent

> The cost of serving a model grows linearly with use (energy)

The cost of processing tokens however does not. Throughput and efficiency are improving around 10x per year. Hardware is not the only factor.

criemen 38 minutes ago | parent

I'm curious, why would this not turn into an unlimited electricity flatrate? In most parts of the world, consumer electricity is charged by kWh, not as flat payment.

As long as tokens are as energy intense to compute as they are right now, I don't see a flatrate being a viable model.

pixl97 31 minutes ago | parent

Power and memory are apt to become the biggest billing constraints.

verdverm 26 minutes ago | parent

Something close to how we rent other cloud resources today makes sense. We don't worry about electricity costs, it's built into the hourly prices, use as much of the hardware as you can. Electricity rates vary over the course of the day as well.

People don't like complex pricing. This would be for businesses running larger workloads. For individuals, the unlimited plan seems the most probable to me. This stuff is going to get real cheap in the coming years.

buckleyourshoe 1 hour ago | parent

Competition drives prices down. We tried Kimi and GLM models after hitting 'cybersecurity' blocks on OpenAI and Anthropic. We found them to be much cheaper to access and helped us complete our work without 'cybersecurity' refusals blocking us.

soupfordummies 53 minutes ago | parent

I wouldn’t be surprised if US “bans” access to the Chinese models by the end of the year

bethekidyouwant 52 minutes ago | parent

How?

ApolloFortyNine 46 minutes ago | parent

If you are a legally operating company in the US just saying it's banned is enough, the threat of enforcement is enough pressure.

You and I obviously can just use a VPN, but 99% of usage is likely as part of a company.

xscott 35 minutes ago | parent

Presumably, legally operating companies aren't the dominant threat though. So banning open weight models doesn't solve anything.

SahAssar 18 minutes ago | parent

> If you are a legally operating company in the US just saying it's banned is enough, the threat of enforcement is enough pressure.

Is there precedent for the US actually "banning" software? I know for example the Kaspersky ban and tiktok ban, but both of those were either banning the sales or banning the service. IIRC neither made the actual software illegal.

What is an example of a specific software being illegal to possess? What is an example of a specific software being illegal to use if it is not used to break other laws (copyright, etc.) or talks to banned service providers?

Closest thing I can think of is restricting the export of cryptography in the 90's, but that was not even close to what you are suggesting.

bethekidyouwant 3 minutes ago | parent

Correct it’s 7% chance on kalshi, and those 7% of people are just wrong. I know everyone likes to larp that the US is some kind of dictatorship, but lol, lmao as they say. Also on the “how” side so far we have “they will just announce that “they” are banned, hilarious.

xscott 37 minutes ago | parent

I think your question is rhetorical, in which case I agree with the sentiment.

The US absolutely could (and very well might) make Chinese models illegal, possibly open weight models in general, but all that will do is keep them out of the hands of law abiding US citizens.

Law breakers in the US and the entire rest of the world would still have access, and nothing in the US will be any safer. People who think regulation will solve the problem should be embarrassed by their ignorance.

aktenlage 33 minutes ago | parent

It may solve the problem of anthropic and open ai going out of business with all major consequences that would have for the rest of the US.

xscott 27 minutes ago | parent

Lol, that's funny in an awful way. Choose between popping the AI bubble or creating a duopoly, and still have all the cybersecurity and other risks.

holoduke 18 minutes ago | parent

I don't get why people think Chinese models could bring openai and anthropic to their knees. There are zero signs of such a scenario. In fact the market is still growing at a gigantic pace. Quality of American models is still AAA. Chinese will have their place. But they are unmatched by their American rivals.

xscott 12 minutes ago | parent

If the capability keeps growing significantly, then I agree it's possible the US could hold their significant lead indefinitely.

However, capability could plateau or reach a point where most of the market can't tell the difference and isn't willing to pay a premium.

jonathanstrange 28 minutes ago | parent

Banning open weight models in the US would provide the rest of the world with a huge business advantage since these models are much more cost-effective than US models.

rcstank 46 minutes ago | parent

What harness are you all using? OpenCode?

mr_mitm 42 minutes ago | parent

I found Claude Code to work best. You can use it with any compatible API.

denkmoon 5 minutes ago | parent

[delayed]

gum_wobble 1 hour ago | parent

Because they have found a way that cost them less to have you use a lesser capable model o less expensive

hauntingseaweed 1 hour ago | parent

Price war. Duh. There is no moat. Also them chinese competition. It’s going to be race to the bottom. It’s gonna be ugly for the stock market. Good for consumers though!

SugarReflex 1 hour ago | parent

Can they do the same thing with fuel prices?

dwattttt 1 hour ago | parent

If you make it easy for lots of people to make the fuel, yes. EVs and smaller scale power generation anyone?

YetAnotherNick 1 hour ago | parent

Yes if China somehow gets the fuel and subsidize it to sell it for cheaper in the global world, even the gulf state price will go down.

dymk 57 minutes ago | parent

Solar panels (which continue get cheaper every year) on my house makes charging my low-TCO EV free in 5 years

3eb7988a1663 1 hour ago | parent

Just wait until the government ban on the dangerous open models materializes.

pixl97 32 minutes ago | parent

Not just models, won't be long before hardware is regulated too.

verdverm 18 minutes ago | parent

I do not expect an outright ban. (1) the bots are too useful, open is the way, re: HF handling the incident (2) you can train without certain capabilities, see Kimi K3.1 (3) reminiscent of the encryption is dangerous debate of the '90s

There will likely be requirements like registering with the government (China already does this, every business already does everywhere), certain usages require more or have deeper regulations (this is already done with most technologies, depending on application)

3eb7988a1663 14 minutes ago | parent

I think it will not technically be a ban, but a de facto one.

Some variation on, "Open weight models must be A) trained in the USA B) have a public training dataset + training pipeline C) be reviewed by a government 'safety council', etc" Something which technically leaves a crack open for someone to release a less capable model than the commercial ones.

verdverm 11 minutes ago | parent

That kind of policy will hold a country back, and why I don't think it will happen. There are already many companies already using Chinese models.

Another confounding factor, if a US company fine-tunes a Chinese model, or vice versa, what is that country that should be assigned to that model.

You also have to consider the competition between the US and China. If the US did something like this, the world will move to Chinese hardware and Ai. The think tanks that talk with legislators understand this.

shwaj 4 minutes ago | parent

Sounds like an eventual Supreme Court case.

Kuyawa 53 minutes ago | parent

Duh, China?

verdverm 22 minutes ago | parent

We also see improvements like 7x between the current and last Google TPU generations, with different chips for training vs inference.

bhu8 51 minutes ago | parent

It’s probably more efficient caching methods and smaller models (6 sol is actually 6 terra and opus 5.5 is smaller than 5.1 etc). Don’t overthink this please

chakintosh 50 minutes ago | parent

It’s a race to the bottom to see who blinks first and goes bankrupt. It’s not sustainable.

trollbridge 37 minutes ago | parent

Is it? DeepSeek has already proved they’re selling inference at a profit.

holoduke 16 minutes ago | parent

Not DeepSeek themselves, but their open models are run by third-party companies in a profitable way. The unsustainable interference theory has been debunked.

written-beyond 2 minutes ago | parent

Define profit? If by profit you mean covering compute costs then yes you're correct. If by profit you mean covering spent RnD budget and future RnD budget allocations then no, by no means are any of these AI companies running at a profit.

Also these third-party providers are running magnitude smaller models than what Anthropic and OpenAI's power users expect from them. Yes the average chat message isn't being routed to the 1+ Trillion param model but people running CC or Codex on Ultra probably are. Those are objectively more expensive.

deadbabe 43 minutes ago | parent

People think OpenAI and Anthropic are just these wildly unprofitable companies with no future or business.

They know what they’re doing. The naysayers are like the people that said this little internet thing wasn’t going anywhere.

shooly 36 minutes ago | parent

It sounds like you're just a "yessayer", though? Not much different from naysayers, just on the opposite side.

One thing that naysayers have going on for them is the fact that those companies indeed aren't making profit right now.

lhd1 30 minutes ago | parent

Whether you think they have a future or not does not change fact that they currently are wildly unprofitable.

>internet thing wasn’t going anywhere.

This is conflating the utility of the technology with the economics behind it. Few people claim LLMs are useless. It's a question of figuring out a viable business model.

wswx 7 minutes ago | parent

correct.

Commercial airlines are of great value to our lives. Who's questioning or denying that?

Horrible business to be in though.

wswx 9 minutes ago | parent

So did the bankers in 2008.

Crazy how delusional people are.

They are in too deep - they have to believe it all works out and act accordingly. lmao.

prjkt 40 minutes ago | parent

They're competing with NVIDIA (huggingface)

Starlevel004 38 minutes ago | parent

> It turned out that GPT-6 Sol was a dud performancewise, so a week later OpenAI announced GPT-6.1 Sol,

I strongly believe that GPT-6 Sol was only ever meant to be the web chat model, but it was a panic public release to respond to Opus 5.5. It's clearly been over fitted for drawing diagrams in the chat.

dez11de 36 minutes ago | parent

Moore’s Law.

redrix 32 minutes ago | parent

This is why Anthropic and OpenAI are pushing for more “regulation”. You can’t show ROI to investors by cutting inference costs.

Regulation might inconvenience them a little, but the upside is huge if it means open models out of China get banned.

paxy 17 minutes ago | parent

Because they have been making inference a lot more hardware efficient.

EXHades 9 minutes ago | parent

Think of all the open source projects in DeepSeek

maxdo 4 minutes ago | parent

It’s both competition almost 3 way , cheaper open source , a clearly lagging behind a bit open ai that cuts prices to win Anthropic customers .

There was an interesting technical advantage by some models where Anthropic as a leader start loosing dramatically in speed to. 5.5 made a come back in that dimension too.