Comment by HyperL0gi
10 days ago
Here is a trend I'm noticing:
- GPT-5 mini costs $0.25/$2 and will be discontinued in December.
- GPT-5.4 mini costs $0.75/$4.5 and is supposed to be the replacement.
- GPT-5.4 nano costs $0.2/$1.25 and, while it ranks better in benchmarks than GPT-5 mini, it's not even close when you test it in real scenarios.
So you're left being forced to go to GPT 5.4 mini if you use 5 mini today.
The same thing is happening here as their “Luna“ model will cost $1/$6.
Can't we just stay with the models we actually want? I don't need GPT 5.4 mini. GPT-5 does the job.
Maybe it’s the realization that it was never that cheap in the first place and they're forcing us to upgrade in a slow and painful way.
If you have no need for Anthropic/OpenAI's frontier model capability, you may be better served with an open-weight model that can't be taken away.
Edit:
> GPT-5 does the job.
I bring up DeepSeek V4 Flash a lot on HN, but I want to mention that according to Artificial Analysis, it trades blows with GPT-5 (high) (from August, 2025) [0]
[0]: https://artificialanalysis.ai/models/comparisons/deepseek-v4...
We rolled out Deepseek V4 Flash to our customers and it was an absolute disaster, unfortunately. It was not able to follow simple commands, always "forgot" to do things, lied consistently about its work, and so on. It was pretty good though on on-off work, like summarizing something or executing simple commands, so we are experimenting now with using it for subagent work with clear instructions and hand off.
Deepseek V4 Pro on the other hand is a really really good main driver and we have a lot of success using it. Its not Opus or GPT-5.5 level but on its way. Kimi 2.6 as well btw.. so there is already quite some choice.
Your experience with DeepSeek v4 Flash differs from mine: while I usually use DeepSeek v4 Pro (that is also inexpensive), I find using DeepSeek v4 Flash with the Fireworks.ai API and properly configured OpenCode to be very good for routine work, and it is pleasantly very fast. Admittedly I use DeepSeek v4 Pro for difficult problems.
I encourage people to at least once a month to do a quick evaluation with their own problems and workflows. Estimate cost as both what inference tokens cost for a task and also how much human effort it takes to get required results.
I disregard benchmarks.
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I found Flash to be a bit shaky as well until I started using it in xhigh/max thinking effort, then it became my daily driver. It runs quite well on a couple of DGX Sparks.
I still wish it was a little better, but there's hope for another model checkpoint (maybe with some of GLM 5.2's goodness distilled into it, that would be nice).
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deepseek has no part of their privacy policy on their API about training. They are 100% training on every single word you give it.
If your customers are fine with that, your IP is not interesting, then you can use it.
Though with open models you have a lot of choice where to get it from. I see like ~15 providers here with various logging/ZDR policies, so pick whatever mix of price to features you want:
https://openrouter.ai/deepseek/deepseek-v4-flash
I don't believe a single word from AI companies, no matter where they are from. Sourcing their training data is run like genuine criminal enterprises - last year Anthropic settled for 1.5 billion, and and if they settled so quickly it might mean what we would see in court is even worse.
You don’t have to access Deepseek through Deepseek. You can self-host it and your data never leaves your premises.
I self-host Flash actually, but yeah.
When I use their API I use it knowing that they probably train on the data, and knowing that it's probably used to improve future iterations of their models.
But I use their API extremely rarely lately, because local Flash is good enough for me the vast majority of the time
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You can use deepseek through opencode, which says its providers have a no-retention policy.
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DeepSeek V4 Pro is only ~3-4x as expensive as Flash. It won't replace GPT-5.5 (nowhere near) but I've been using the $20 sub to punch through tough cases and use Pro for rest.
It’s my daily driver in opencode
Deepseek V4 flash is actually useless. Sorry I've tested it after seeing so many comments like these. On Open router when trying to get it to output tool calls for creating tables, instead of providing the structured output correctly it was sending me peoples dropbox links and other image sharing site urls that led to pictures of random tables...
Llms seem to only impress a certain type of person. Hint, this type of person also was really excited about NFTs.
Unless you are hosting it yourself on your own infrastructure it absolutely can be taken away.
For all intents and purposes you'll be able to move an open weight model wherever you want.
I really dislike this rhetoric, you sound like the FSF guys who are like "you're not free until you're running coreboot with zero binary blobs". Sure they have a point but also, most people are fine running regular linux.
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Still, with the same model being served by multiple providers, it is much less likely to disappear entirely, even if you would like to keep using a cloud provider. Worst-case scenario, you change providers. Or you use OpenRouter as a proxy.
There is actual market competition to host open models. If one provider stops offering a model you likely can find another provider that will
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But you have multiple providers, not just one.
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No. As long as you downloaded the weights, you can run them somewhere.
Popular open models on Openrouter have dozens of providers.
No it can't you can take it where ever you want. It is yours not theirs.
>Unless you're running Linux yourself, it can absolutely be taken away.
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I just want personal agency
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It’s the same as the SaaS model. Price keeps going up, and to justify it they keep forcing you to upgrade to new versions with features that nobody asked for.
“More intelligence” is the new feature. Almost everyone is asking for this.
Citation: have you looked at OAI and Anthropic’s customer growth numbers?
Every use case of every customer doesn’t need more intelligence. I’m willing to bet that the vast majority will be perfectly fine running on “low intelligence” at a cheap price forever.
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I've struggled with this. You definitely can have great cheap models. There are many of them open source and served profitably by neo-clouds. The big labs have basically given up on cheap models, and it is frustrating. It means applications are not likely to build as much on them anymore (we are shifting workloads from Haiku/Sonnet to Deepseek v4, for example).
I suspect the problem is that they need to charge a lot to keep revenue numbers up, and they are more worried about cannibalizing themselves than others cannibalizing them.
Each model release gives an opportunity to reduce the number of old models still on offer, and charge a higher, less-subsidized tier. The trick is to charge a subsidized price that is less than an M3 Ultra, so they continue paying you rent, instead of a one-time fixed cost. So far open models can't compete with Opus 4.5 but as soon as it can, people will be looking at buying devices that can run that model locally.
We are a claude shop but we already bought two mac studios to start migrating less complex but still agentic workflows there. We will break even on those in less than a year.
Breaking even in less than a year? What's the math on that?
Good observations. There's definitely a trend in pricing increasing but also balanced by innovations and availability of other models (both open and closed) emerging as alternatives. It's natural for the labs to explore how much they can push pricing, and for competitors to explore how they can treat that margin as their opportunity to grow their business.
Eventually the pricing should be more stable.
> Eventually the pricing should be more stable.
Why do you think so? This game can be played forever, you just need strong marketing and orgs gullible enough to pay a higher price for a minor upgrade.
Its happening to Anthropic Haiku and Gemini Flash/Flash lite. All of them are increasing prices and deprecating cheap models.
5.5 is smart enough for 99% of my tasks. I need that level of intelligence at ever decreasing prices.
On Nano "it's not even close when you test it in real scenarios" - what have you seen? What kind of things can GPT-5 Mini handle that GPT-5.4 Nano cannot?
We’re using GPT-5-mini in an enterprise data-processing workflow, and we too see that GPT-5.4 nano performs materially worse for our requirements, roughly 30% worse as measured through our test suite.
Also can confirm gpt-5.4-nano was unable to even keep up with 4.1-mini. Had to move off of OpenAI once 4.1-mini was retired
No, you can't. These companies have two infrastructures: model training and model inference.
Inference needs to cache, it can't cache random model data, so it's essentially dedicated; it can't spin up models on demand, it has to know what demand is coming.
These companies are going to end up with very few models offered and that's probably generous. They might end up with just one model and you pay for removing it's safe guards.
Hardware hosting old models isn't hosting new models. If you want consistent models, host your own open weights ones.
> stay with the models we actually want
If you want control over the models you use, you have to self-host.
Gemini has done the same thing, gemini-3.5-flash is 15x more expensive for input tokens than gemini-2.0-flash. They are forcing us up the pricing ladder by deprecating the old models....
I don't know about Cursor or other outlets, but I use GPT 5.4 exclusively in Windsurf (Sorry, Devin!), and it's a very capable model that doesn't break the bank!.
I think it's more that they're abandoning simpler AI tasks to chinese models. Qwen 35b and deepseek flash are better than gp5 mini on my tasks and way cheaper.
discontinuing the cheaper options is a risky move for openai
will trigger re-evaluations of models by other labs + inference providers
I can speak for myself. We are exactly at this moment trying to replace GPT 5 mini with an open weight / open source model. No luck so far.
Yeah, this is the classic silicon valley strategy of selling at a loss and then once they have captured the market inflate prices.
See Uber, Netflix, etc.
I don't see them capturing anything at this point. If inference was profitable then they could compete on price/model and capture the market. Then increase price and pay back the model training.
Feels like they are just pulling in as much as they can whilst competing on capabilities instead. At which point its a case of who can last the longest.
Doesn't feel like Uber/Netflix.
They're trying to do it more like a cartel where all major providers raise prices in unison. The intention is (probably) less specific entrapment and more getting people addicted to a fast LLM. From there, they all play with pricing to give a semblance of choice, without actually overly undercutting each other. At least, in the west.
This is all done to help valuations. The main revenue source are the investor dollars at the prospect that this industry will very soon actually be sustainable and highly profitable. It won't be, but if very soon stays around the corner consistently, the investor dollars keep coming.
This is a constantly repeated conspiracy theory and is not true at all. The api costs do increase but aggregate costs per task decrease. The question is: do people need lower intelligence models at all? The answer is a resounding NO!
How many people do you see using haiku or sonnet? I see very few and most people default to the latest model and just play with thinking effort. I think three layers are good enough and supporting more is not a good UX.
Do I need the most intelligent model to generate boilerplate code, which is my main usage for AI? Resounding No.
For my use case a model from a year ago is good enough
Are you only considering coding use cases?
Many enterprise use cases, such as simple data extraction, are well served by cheaper models.
I... use them all the time: plan with a more advanced model, build with a cheaper one. Anthropic literally packages a metamodel (opusplan) for that pattern.
Also: calling the SV blitzscaling strategy of using VC money to fund loss leader products with the goal of building a monopoly via dumping a conspiracy is quite the position given there's entire books written in the topic...
Why not self host or go to openrouter if you don't need SOTA frontier?
who tf would use mini when you have dsv4 flash
> Maybe it’s the realization that it was never that cheap in the first place and they're forcing us to upgrade in a slow and painful way.
All the analysis I have seen points to frontier models being profitable to serve. It’s using 50% or more of your GPUs for research plus CapEx for capacity expansion that makes these businesses so heavily cash-negative.
What you are observing is downstream of another detail. It gets more expensive to serve a model as utilization goes down. Plus the opportunity cost vs newer, more-profitable models.
There are plenty of valid reasons to critique here. “OpenAI is lying about this being a sustainable price to serve” is not one of them.
There is really ample analysis pointing to inference not being profitable, look at anything Ed Zitron has reported.
Ed Zitron is amazing at cherry picking data to fit his thesis.
No. Welcome to the wonderful world of SaaS. If you want your gui, your terms, your software, self-host.
But I think, in time, a new generation will relearn this truth.