alt Hacker News> They aren't going away but for some they may become prohibitively expensive after all the subsidies end.
Even if inference was subsidized (afaik it isn't when paying through API calls, subscription plans indeed might have losses for heavy users, but that's how any subscription model typically work, it can still be profitable overall).
Models are still improving/getting cheaper, so that seems unlikely.
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ernst_klim • yesterday at 12:56 PM
It probably is still subsidized, just not as much. We won't know if these APIs are profitable unless these companies go public, and till then it's safe to bet these APIs are underpriced to win the market share.
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> afaik it isn't when paying through API calls
There is no evidence for this. The claims that API is "profitable on inference" are all hearsay. Despite the fact that any AI executive could immediately dismiss the misconception by merely making a public statement beholden to SEC regulation, they don't.
> Models are still improving/getting cheaper
The diminishing returns have set in for quality, and for a while now that increased quality has come at the cost of massive increases in token burn, it's not getting cheaper.
Worse yet, we're in an energy crisis. Iran has threatened to strike critical oil infrastructure, and repairs would take years.
AI is going to get significantly more expensive, soon.