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Open-weight AI models undercut proprietary rivals by up to 50x, raising questions about Big Tech's pricing strategy

By

by James O'Claire

5h ago· 3 min readenOpinion

Summary

The article discusses the dramatic price disparity between open-weight AI models like DeepSeek V4 and proprietary models from Anthropic and OpenAI, noting nearly a 50x price increase for the latter. The author expresses concern that Anthropic and OpenAI have backed themselves into a corner with high costs and questions whether they can reduce prices by 20-50x to compete with open-weight alternatives like DeepSeek and Xiaomi's Mimo.

Source

Hacker NewsOpen-weight AI models undercut proprietary rivals by up to 50x, raising questions about Big Tech's pricing strategyjamesoclaire.com

Key quotes

· 3 pulled
Nearly a 50x price increase based on tokens alone, let alone how much pondering any of their models might fall into (using more tokens for the same task).
What worries me about this is that Anthropic and OpenAI seem to have backed themselves into a corner of high costs.
Can they reasonably decrease their prices by 20-50x to compete with DeepSeek or Xiaomi's Mimo?
Snippet from the RSS feed
Today I was setting up Hermes to see how it does with web research. I chose DeepSeek V4 because I know it is cheap, but seeing it’s pricing next to Anthropic and OpenAI ‘frontier’ models is crazy. Nearly a 50x price increase based on tokens alone, let alo

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