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Price per 1M tokens is meaningless

janilowski.pl

101–110 of 113 posts

Re: Price per 1M tokens is meaningless

#101

Earlier quoted context omitted.

Tokens do reflect the provider's cost though - each token output required them to execute the model once, normally incurring a fixed amount of compute per token.

Providers amortize the compute across a batch. If yours is the only request in the batch it will cost them one full pass through the model. If yours is one of 1024 inputs in the batch the per token cost is 1024x less.

Apparently hardware depreciation is the dominant cost rather that operational cost (electricity etc), and this is occuring at a fixed rate per the planned replacement lifetime.

So, the cost to provide the service is essentially fixed regardless of load, but the revenue they are generating is variable. In practice most GPU's are going to be capacity-maxxed since the providers sell cheap batch APIs that they queue to keep the machine loaded. They'd be losing money over a given time interval if revenue generated during that interval wasn't greater than depreciation (etc), but it seems that will rarely happen.

Re: Price per 1M tokens is meaningless

#102
post #92

Earlier quoted context omitted.

[flagged]

>Careful you don't "it's just a text predictor" yourself into unemployment . Says the guy who is "I-can-now-just-push-buttons-and-get-paid-forever"-ing into not only into unemployment, but also being totally redundant. Before you come back with, "Oh I review everything LLM does": Only in your dreams you ll gain or retain experience by just reviewing stuff. That is even if you actually review every line that the LLM w…

I do have an entirely AI written project, and I don't think I've reviewed even 1% of the code the bots have generated; it's been my pure vibe project. It's about what you'd expect, too.

Elsewhere, I still haven't reviewed the vast majority of AI code I've generated, but all of the AI-generated code I've submitted I did review exhaustively. I have a couple of past roles to thank for drilling some strong code-review strategies and - thus far - have had the willpower to reject an AI generation when I know I can't/won't diligently review.

LLMs do not do anything but generate a token. It's a trivial but critical distinction like RNG vs pRNG. The LLM doesn't learn, it doesn't do backtracking, their output is deterministic.

Not "chatgpt.com"s output, but the LLM powering it; Anthropic aren't customizing a version of Claude's weights/tensors on your inputs, they're adding billable input tokens to the baseline of your subsequent contexts.

Its very financially convenient for Anthropic and OpenAI if people think of the LLM as doing the work, because for a lot of people that conjures a sense of a system that inherently learns and improves.

Even some of the people I've worked with on low-level LLM harnessing tools/systems since early 2023 fall for it and start thinking of the LLM as an AI with the connotations of back-propagation, weight adjustment, ... learning.

The "AI" is in what the harness software does with the inference output and the context it feeds back to it.

It took forever to convince people that quality degrades with context length but then all we got was compaction, there's still huge resistance to harnesses actively curating the context.

A lot of non-devs I've spoken to assumed when their tool said "Now I need to re-read" it was overwriting the 'in memory' copy.

You open aider or code or claude and ask it to fix a bug in file., it reads the entire 8k file, reasons about it (in which it sometimes echoes specific lines of code), and then it "edits the file".

To edit a file, inference currently injects a stream of tokens into the context that your software identifies as a tool call.

[tool name="edit" file="..."] @120,131 - halt_and_catch_fire() + exit_nicely() [/tool]

And frequently the tooling will guide the model to re-read the file, in some pathological cases by prompting the model to generate a tool instruction to do it.

Your context now contains: pre-prompting, your prompt, first file read (8k tokens), reasoning, all the tool calls to make the changes, re-read (8k tokens), conclusory reasoning, tooling prompts llm to describe what has been done, work-done-summary.

Because of the way the underlying LLM works and because of the way the APIs are presented, tools are discouraged from redacting or eliding the original read.

Otherwise, what they'd already be doing is curating the context: read file once, append output from inference/tool calls, and when it's done, replace the original insert of the file.

Having 2 or more disagreeing versions of a significant source file in your context is detrimental to model attention and output quality, and you either see people who get it and manage it, or who wallow in superstition and hand-waving and a near eagerness to pay for "mistakes" that the "model is making" because they believe it is learning, on the fly.

Re: Price per 1M tokens is meaningless

#103
post #56

I feel we are caught in a "this is fine, pay more and we may turn down the fire" situation. The LLM itself produces one token. Some tool adds that token to the input and runs it again, flogging the horse. Downstream another tool, some kind of harness, tries to control this stream by injecting tokens into the context and then sending it to the inference tool, and then trying to pattern-match the output. Finally, there…

> it's just a text prediction algorithm that can pull out entire sentences when you use it to infer output on topics it trained on This downplays the incredible things that can be done with it. There's a lot of noise, yes. How long has the web existed? And yet we're still figuring out how to optimize (HTTP/3). Disregard the signal at your own expense.

Maybe, but I think the downplay is worth it to emphasize that the things have to be done. The point is precisely that token generation is a phenomenal power source but it does not give you anything but debt unless you build the tools to leverage it.

None of the big players involved right now seem to be doing anything to disarm the perception that the LLM does all the work.

I feel like we're at a state fair 180 years ago having just seen an impressive demonstration of small animals momentarily coming back to life, someone in the crowd said 'eternal life' and everyone lost their minds trying to give money to the 'inventor' on the stage who applied the electric current.

Ask some lay people or junior devs how they feel about LLM mistakes, listen for answers about "learning" etc. Do they realize the model doesn't change? The same set of weights and tensors are deployed to every GPU hosting it. If you use a power tool that lets you specify the temperature and seed, it will generate the exact same output time after time.

"But I told it to always speak like a pirate, and it does": No, you signed up to pay for the model to be told to speak like a pirate every time you use it.

There - that's the curtain I'm talking about that you're lifting/tearing. I think momentarily downplaying the potential of LLMs themselves is worth it to expose that.

Re: Price per 1M tokens is meaningless

#104
post #103

Earlier quoted context omitted.

> it's just a text prediction algorithm that can pull out entire sentences when you use it to infer output on topics it trained on This downplays the incredible things that can be done with it. There's a lot of noise, yes. How long has the web existed? And yet we're still figuring out how to optimize (HTTP/3). Disregard the signal at your own expense.

Maybe, but I think the downplay is worth it to emphasize that the things have to be done . The point is precisely that token generation is a phenomenal power source but it does not give you anything but debt unless you build the tools to leverage it. None of the big players involved right now seem to be doing anything to disarm the perception that the LLM does all the work. I feel like we're at a state fair 180 years…

I suspect the next real advance will be the LLM equivalent of thin-client/fat-server evolution, a sort of "local lora" system that forms the unique part of your own agent(s) distinct from the underlying static model, and capable of dynamic learning/processing.

Could it be cloud-based? That changes the risk and scale calculus in a way that's going to take a long time to get funding into.

Re: Price per 1M tokens is meaningless

#105
post #103

Earlier quoted context omitted.

> it's just a text prediction algorithm that can pull out entire sentences when you use it to infer output on topics it trained on This downplays the incredible things that can be done with it. There's a lot of noise, yes. How long has the web existed? And yet we're still figuring out how to optimize (HTTP/3). Disregard the signal at your own expense.

Maybe, but I think the downplay is worth it to emphasize that the things have to be done . The point is precisely that token generation is a phenomenal power source but it does not give you anything but debt unless you build the tools to leverage it. None of the big players involved right now seem to be doing anything to disarm the perception that the LLM does all the work. I feel like we're at a state fair 180 years…

We're at a state fair watching a lightbulb flicker to life, that works for 12 hours before burning out.

Re: Price per 1M tokens is meaningless

#106
post #103

Earlier quoted context omitted.

Maybe, but I think the downplay is worth it to emphasize that the things have to be done . The point is precisely that token generation is a phenomenal power source but it does not give you anything but debt unless you build the tools to leverage it. None of the big players involved right now seem to be doing anything to disarm the perception that the LLM does all the work. I feel like we're at a state fair 180 years…

We're at a state fair watching a lightbulb flicker to life, that works for 12 hours before burning out.

On the summer solstice, with the bulb going on shortly after sunrise and burning out just before it started to get dark? :)

Re: Price per 1M tokens is meaningless

#107

I keep trying to convince directors and executives at my company to look past the cost per token amount but they refuse to do so. Those are the only things that actually give any sort of measurement of the monetary value of a token by these labs, and so its what many go by. For example there's some benchmarks that show that Opus for any task that requires a higher than `high` level of effort, may have actually been c…

All of this should be abstracted by the harness, which (ideally) should figure out which model to use for which queries.

Re: Price per 1M tokens is meaningless

#108

Earlier quoted context omitted.

Yes, it's a "cloud provider" but it's a cloud provider running an open model you can download (and that other cloud providers do host). I just happen to not have a computer big enough to host it. As for the Orchestrator, it's pretty simple. In essence, it's like "Jira/Trello/Kanban on autopilot". Work items have states, a state machine defines how those work items transition between states, states are todo, in progre…

Ok, so I have to try that. How are you specifiying the graphs? Is this on github (I am still trying to move from concept to how to actually do it (plus Inhave only just woken up and need coffee :-)

Leland is a CS student, that being said I agree the concepts and pricing are tempting. There are more of these Kanban for Agents eg Multica, PlateSpinner, KitKot, Kanbots.

Re: Price per 1M tokens is meaningless

#109

Earlier quoted context omitted.

Ok, so I have to try that. How are you specifiying the graphs? Is this on github (I am still trying to move from concept to how to actually do it (plus Inhave only just woken up and need coffee :-)

Leland is a CS student, that being said I agree the concepts and pricing are tempting. There are more of these Kanban for Agents eg Multica, PlateSpinner, KitKot, Kanbots.

I was a student whenever I wrote my old bios but I've been a developer professionally for over 10 years at this point.

My inspiration was the mayor idea from Gastown, plus wanting to formalize the informal workflow I used with agents and Jira at $dayjob.

Re: Price per 1M tokens is meaningless

#110

An LLM is an extremely complex thing used for all manner of purposes. The hope that there would be some simple pricing construct that would map nicely to value provided is a pipe dream. Pricing per token is at least reasonably straight forward. If you aren't getting value, you don't use the service. One doesn't buy a Ferrari and then complain that in their town Ferrari doesn't help them pick up women and hence it sho…

I'd say it's more like going to a Ferrari dealership and they tell you they will build a car for you and bill you per gram of parts used. It might also not work. And they might also not build it ever, really — but they will bill you for any attempts to build it.

That's fine though. If that doesn't work for you, don't buy. There are all manner of situations where what one wants or needs and what they get don't match up well. You don't price out every situation - it's take it or leave it. Pricing in a way that is somehow based on cost structure at least enables the provider to work to reduce the cost and hence price and win. Costco prices at a small margin above cost, they don't price "if this meets value prop X, pay Y and if only value prop A, pay B".
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