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qlte | on: OpenAI and Anthropic cut their LLM prices by up to 80% within a few months. Why?
The profit comes from the enterprise customers who have to pay for usage at API rates. Not the subsidized subscriptions, which both OpenAI have designed to be unavailable for large enterprises by withholding IAM and auditing features they need except on the usage based entperise plans.

As an individual I'm still paying for a ChatGPT Plus plan since $20/mo gives me a lot of value and I use many multiples of $20 at API rates per month. But in terms of capabilities, I am entirely satisfied when using my Opencode Go plan with open models like Deepseek Flash/Pro, Kimi and MiMo.

At this point keeping my ChatGPT subscription isn't because of a significant capability gap compared to open models. It's 90% about the value of the subscription priced well below API rates (10% the fun of trying latest models).

If OpenAI/Anthropic dropped their cheap subscriptions or drastically undermined the value proposition I'd be happy using open models exclusively and currently barely notice a difference switching back and forth for the vast majority of tasks.

I'm expecting the subs to increasingly provide less value as the US labs IPO and follow the SV pattern of moving from marketshare capture mode to profit extraction mode. Thankfully I'm already comfortable using OpenCode with open models and avoid lock-in to any specific harness so would be a very soft landing.

baq | parent | next
Let’s not forget that Luna max is actually extremely capable for the price, you can get a lot done on the $20 sub.

Haven’t tried haiku 5.5, I expect it to simply run out too fast, but they did change the price below 100k tokens recently; perhaps I should check it out.

ngruhn | parent
I guess I don't understand "enterprise psychology" but why are auditing features worth a 50x premium? I think we're currently blasting through $1000 worth of tokens a month per dev.
ehnto | root | parent | next
Because enterprises have compliance and certification requirements, meaning the enterprise is essentially held hostage by providers on price.

You could argue it's worth that much because of the value that compliance brings the enterprise, but it's just another gouging excercise. Certainly nothing unique to AI companies.

mschuster91 | root | parent
> I guess I don't understand "enterprise psychology" but why are auditing features worth a 50x premium?

Alternatively, one can say that the enterprise customers plus a metric shitload of VC and shareholder/investor money heavily subsidizes cheap personal plans.

It's the same playbook that Adobe used, provide cheap plans for academia and turn a blind eye towards piracy from non-commercial actors, get the young people hooked hard on Adobe's software and workflows, and they will demand that their employers purchase the nice, high profit commercial/enterprise plans.