AI costs spike as subscriptions hit pricing wall — firms turn towards Chinese LLMs, open-source models to extend budget

Summary

As token costs for frontier AI models skyrocket, companies are seeking cheaper alternatives, turning to Chinese LLMs and open-source models. Subscription models are also eating into the profitability of startups like OpenAI and Anthropic, with utilization rates above 5.7% potentially leading to losses.

Source links

• https://www.tomshardware.com/tech-industry/artificial-intelligence/ai-costs-spike-as-subscriptions-hit-pricing-wall-firms-turn-towards-chinese-llms-open-source-models-to-extend-budget