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Is it fair when the one is heavily subsidized and the other one is not? I think it's most fair to compare the plain token pricing that is used by everyone.
by buster 3mo ago
Is it fair when the one is heavily subsidized and the other one is not?
I think it's most fair to compare the plain token pricing that is used by everyone.
- esperent 3mo ago> Is it fair when the one is heavily subsidized As a consumer, yes, it's totally fair. All that matters to me is the price I pay at the pump, not whether that price is "real" or not.
- usef- 3mo agoZ.ai is also believed to be "subsidised". Its parent company is running at a large loss right now. Anthropic have claimed they expect their first profitable quarter this year -- they may have bigger margins on their raw API than you realise.
- stavros 3mo agoWe're all sure they have big margins in their raw API, it's the subscription we're claiming is subsidised.
- usef- 3mo agoOh I know. But people often point to the API usage cost as an indicator of the magnitude of subsidisation, or to say that the big labs are far less efficient than cheap competitors. I'm saying that this is not necessarily the case. They do a lot of optimisation and don't have the same price pressure to lower margins. They may not be losing as much on subscriptions as people think.
- stavros 3mo agoOh hm, I've never seen this. API prices have always been exorbitant, I'm sure they're making good margins on that. Let's hope they aren't losing as much on subscriptions, because I'm not ready for everything to be API costs.
- fooster 3mo agoI don't think it is fair to say that opus or gpt 5.5 are subsidized? inference for both anthropic and openai are very profitable.