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One of the strangest things in the AI industry is 'tokenomics'. It's not very clear why using GPT-4 in early 2023 was so expensive and then six months later 20 bucks could get you a fair amount of GPT-4 inference. This pattern has continued across various labs/providers for years--there is a continuous see-saw of pricing that doesn't seem related to anything.

So what open weight models do is at least provide a baseline of inference cost to add some sanity to the price markers. And of course predictability too--if you really want Kimi K2 instead of K3 you can still use it.

So the competitive pressure and predictability offered by open models is helpful for users

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> It's not very clear why using GPT-4 in early 2023 was so expensive and then six months later 20 bucks could get you a fair amount of GPT-4 inference.

FlashAttention was a hell of a drug.

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Why do prescription medications cost so much, and generics so little (comparatively)?

Artificial inflation to recoup R&D.

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Its very clear: nobody wanted to pay for usage at that price point
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It's basically supply and demand?
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