alt Hacker News> Inference is not being subsidized and in fact has pretty high margins.
I was referring to the "AI labs" here. Sam Altman himself conceded that OpenAI is losing money on the $200 subscription. Using open-weight/open-source models is indeed cheaper (and no reason for inference to be subsidized).
That's not what I mean. If competitors can offer tokens 15x cheaper, the big labs must have high margins per token. (which they can use to amortize training costs)
>Sam Altman himself conceded that OpenAI is losing money on the $200 subscription.
They have since stopped offering the $200 subscription, probably for this reason.
Subscription margins are harder to judge because it depends on usage; token costs are a better comparison.