alt Hacker NewsI’ve said this before on HN, but there are two things that make me optimistic that we won’t see a big rug pull where price-to-capability ratio skyrockets relative to today:
* People keep finding ways of cramming more intelligence into smaller models, meaning that a given hardware spec delivers more model capability over time. I remember not that long ago when cutting edge 70B parameter models could kinda-sorta-sometimes write code that worked. Versus today, when Qwen 27BA3B (1/23 of the active parameters!) is actually *fun* to vibe code with in a good harness. It’s not opus smart, but the point is you don’t need a trillion parameters to do useful things.
* Hardware will continue to improve and supply will catch up to demand, meaning that a dollar will deliver more hardware spec over time. Right now the industry is massively supply constrained, but I don’t see any reason that has to continue forever. Every vendor knows that memory quality and memory bandwidth and the new metrics of note, and I expect to start seeing products that reflect that in a few years.
I hope that one day we’ll look back on the current model of “accessing AI through provider APIs” the same way we now look back on “everyone connecting to the company mainframe.”
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I agree.
Between: more efficient models - tuned for the task at hand, the ability to run those models in-house, or even at the edges, plus Google and Microsoft are well positioned to stay ambivalent as they’ve got lots of products to sell and whether or not LLMs are part of the portfolio mix is completely dependent on enterprise customer demand.
Anthropic/OpenAI have a number of aggressive downward pressures on their pricing.
The price for a given level of capability will fall, but the frontier has recently been getting more expensive. If you compare GPT-5 to GPT-5.5 on the Artificial Analysis benchmark, it's ~4x more expensive, but achieves a higher score. Claude 4.7 is also more expensive than predecessors because of a tokenizer change.
As the AI labs become more reliant on enterprise adoption, it makes sense to push capabilities at a cost that makes sense for businesses. Even if it prices out consumers or hobbyists.