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

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.

DeepSeek claims $38 of revenue per GPU, per hour for Flash V4. That is $332,880 per GPU, per year. This matches their DeepInfer numbers: 25,600 output tokens/s per GPU sold at $0.60 per million -> $55 minus some other overhead to arrive at $38. For the bigger Anthropic and OpenAI models (and associated higher prices) there are many unknown factors. But presumably they also work hard on optimizations, and it's not so crazy to think they had or still have a lot of wiggle room to adjust prices.

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.

Psy ops. Grabbing users for their IPOs. Once they have you the prices will go up again.

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