Shouldn't we know a better answer to these questions once Anthropic's IPO materials surface publicly? I understand, and maybe even expect, SpaceX's materials to be all over the place and skate on by any discussion of unit economics, but the nerds over at Anthropic might just be forthright enough to just tell us what their margin is on tokens as part of their IPO.
AI's Affordability Crisis
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Re: AI's Affordability Crisis
#12This is basically bunk because AI costs have gone down by 50x or more (api costs) since 3 years.
Can you cite a source? Everything I've read describes the costing as linear with growth.
Re: AI's Affordability Crisis
#13This is basically bunk because AI costs have gone down by 50x or more (api costs) since 3 years.
Can you cite a source? Everything I've read describes the costing as linear with growth.
The quality of what you can get from DeepSeek V4 Pro for $10 is light years ahead of what you could get for $20 a year ago.
Likewise, the quality of what I can get from a local model like Qwen 3.6 on an RTX 5090 is light years ahead of what I could get a year ago on the same hardware.
Re: AI's Affordability Crisis
#14I really can’t stand when writers point to the difference in price per token on the api and subscription and use that as evidence that inference loses money. This author even says it’s implausible that the api charges 4x marginal cost when I think it’s very likely even higher than that. The entire rest of the post sits on this faulty assumption. Fixed costs don’t matter when marginal revenue is profitable and growing rapidly. The ai labs only have 2 questions. Can they prevent users from switching to open source models? Can they scale the number of users on enterprise plans the way they did for coding but in a more general way for all knowledge jobs?
Re: AI's Affordability Crisis
#15This is basically bunk because AI costs have gone down by 50x or more (api costs) since 3 years.
Because of it's unpredictability and massive dependence on the training data, when LLMs start hallucinating most of the time the only fix these "engineers" have is to feed it another LLM... The genius was the transformer architecture, and evidently none of us have a damn clue how it works
Re: AI's Affordability Crisis
#16Shouldn't we know a better answer to these questions once Anthropic's IPO materials surface publicly? I understand, and maybe even expect, SpaceX's materials to be all over the place and skate on by any discussion of unit economics, but the nerds over at Anthropic might just be forthright enough to just tell us what their margin is on tokens as part of their IPO.
Well it probably doesn't help that Dario is going around on podcasts saying things like "frontier labs need $1T of revenue or they will go bankrupt" lol.
Re: AI's Affordability Crisis
#17The article fails to mention DeepSeek, Alibaba, Qwen, Xiaomi, MiMo, z.ai, or GLM. It's hard to take such an article seriously that doesn't do this. (Our monthly total spend is around $180 with a team of 6, about half technical; our biggest line items are for American models or subscriptions which we probably will be planning to get rid of.) And then remarks like this: Anthropic, OpenAI and Microsoft have all now tran…
> Our monthly total spend is around $180 with a team of 6, about half technical; our biggest line items are for American models or subscriptions which we probably will be planning to get rid of.)
Please tell more :). Do you pay per token from bedrock / openrouter / somewhere else? How many tokens you use over the month, and how many for each task? Which harnesses?
Re: AI's Affordability Crisis
#18This is basically bunk because AI costs have gone down by 50x or more (api costs) since 3 years.
This doesn't really tell you anything useful. AI companies have both built huge datacenters and raised a colossal amount of money. Include caching, quantization and etc. All of those would allow them to undercut on price considerably, even more so if you count in all the users who don't actually cap out their plans. Prices going down doesn't really tell you anything about the production cost, especially in a market where every major participant is happy to burn money just for the marketshare.
Re: AI's Affordability Crisis
#19This is basically bunk because AI costs have gone down by 50x or more (api costs) since 3 years.
This doesn’t solve the problem because (tautologically) the more AI prices go down the less money the companies make. If right now today the companies are operating at a profit and a price war causes the API costs to sink 90% next year, and their capex amortization costs stay fixed.
The math doesn’t math.
Re: AI's Affordability Crisis
#20Spelling mistake: "a return on these invetment"
It's Proof of (human) Work. Much more useful than having a sticker saying "Done by a Human".
Ask your LLM to 'write like a phishing email' to have it seem more human.
I'm actually curious if this works, haven't tried but I assume it would.