OpenAI and Anthropic Slashed AI Model Prices by Up to 80%

As competition from cheaper open-weight models intensifies and both businesses face questions regarding potential public listings, openAI and Anthropic have reduced rates for their flagship AI models by as much as 80% over the past four months.

Key points

• DeepSeek's Flash V4.1 1017 model, published in April, offers input, output, and cached token pricing of $0.15, $0.60, and $0.003 per million tokens, respectively.
• Kimi K3.1 Pro Takes on Claude Opus 5.5 and GPT-6 Astra at Much Lower Cost.
• Data from Vercel's AI model gateway additionally indicates that the average cost per token has fallen to 43.3% of its April 2026 level.
• Moonshot AI's Kimi K3.1 Pro reportedly delivers performance comparable to Claude Opus 5.5 at half the input and output cost.
• Pricing comparisons additionally show that OpenAI's 80% reduction for GPT-5.6 Luna significantly improved its cost competitiveness against DeepSeek V4 Pro.

Notably, the rapid cost cuts, which began in June, have lowered API usage costs by 75% or more in some cases. Competitors such as DeepSeek and Moonshot AI have rose pressure on the two businesses by offering lower-cost models through platforms such as OpenRouter, where dozens of providers offer AI inference services.

OpenAI began the latest round of reductions in late June when it introduced GPT-5.6 Luna at $1 per million input tokens and $6 per million output tokens. By July 30, the firm had reduced both costs by 80% to $0.20 and $1.20, respectively.

Anthropic followed in August by making its temporary launch discount for Claude Sonnet 5 permanent. In September, it further reduced Claude Opus 5.5 pricing by 40% to 60%.

Days afterwards, OpenAI introduced GPT-6.1 Sol at half the input and output costs of its predecessor. The firm additionally reduced cached input pricing to 5% of the regular input cost, matching Anthropic's rate.

Max Woolf, a former senior data scientist at BuzzFeed who tracks AI model pricing on his blog, remarked the speed of the reductions surprised him. He observed that the cost of using leading AI models has fallen much faster than he anticipated a year ago.

Meanwhile, the lower rates are particularly notable for AI coding tools such as Codex and Claude Code. These tools repeatedly access cached conversation histories, with cache reads accounting for 96% to 99% of token spending in such workflows.

Consequently, a 75% reduction in cache-read rates can reduce effective usage costs by approximately 70% to 75%.

Data from Vercel's AI model gateway additionally indicates that the average cost per token has fallen to 43.3% of its April 2026 level. Nevertheless, total spending continues to rise since improvements in AI model capabilities are driving greater usage. Cheaper Open-Weight Models Growth Competition.

OpenAI and Anthropic are additionally facing stronger competition from open-weight AI models, particularly those developed by DeepSeek and Moonshot AI.

Notably, the model is now available through 29 different inference providers on OpenRouter, compared with just 13 in May. Providers such as Cloudflare and DeepInfra offer effective usage costs within 10% of DeepSeek's own endpoint.

Meanwhile, Moonshot AI's Kimi K3.1 Pro reportedly delivers performance comparable to Claude Opus 5.5 at half the input and output cost. Moonshot AI intends to release the model's weights on November 4.

Pricing comparisons additionally show that OpenAI's 80% reduction for GPT-5.6 Luna significantly improved its cost competitiveness against DeepSeek V4 Pro. Without the reduction, DeepSeek's model would have offered a better position on the documented quality-versus-cost comparison.

Despite their lower rates and growing availability on OpenRouter, open-weight models still account for a minority of total token usage.

Woolf remarked OpenAI and Anthropic must continue developing higher-quality models to compete with cheaper alternatives. He identified Claude Opus 5.5 as an example of how premium models can maintain an advantage through performance. Cost Cuts Raise Questions Concerning Potential IPOs.

Meanwhile, the reductions additionally come as both businesses reportedly consider entering the public market.

While Anthropic could file for an IPO within the next few months, openAI is rumored to be targeting an initial public offering in 2027.

Both firms have noted billions of dollars in losses related to research, development, and infrastructure expansion. Nevertheless, those figures predate the recent rise in AI agent usage.

Cutting rates by as much as 80% could complicate their financial positioning ahead of potential IPOs, particularly if lower costs reduce profit margins. Scientists Discover What AI Does When Left Alone.

Nevertheless, some reports suggest the businesses previously generated profit margins of around 80% per token before the latest reductions, potentially giving them room to lower rates while remaining profitable on inference. The changes have additionally affected how developers manage AI spending.

Woolf remarked GPT-6.1 Sol's pricing reduced his effective usage costs by approximately 75%. He subsequently lowered his Codex usage quota to one-fifth of its previous level while keeping his overall spending roughly unchanged.

Meanwhile, OpenAI reduced the usage allowance for its $200-per-month Codex tier by 50%, citing increasingly efficient models. AI Model Rates Could Fall Further.

Woolf believes AI model rates could continue declining as long as competing inference providers maintain similar performance and pricing while allowing customers to switch services with minimal difficulty.

Meanwhile, OpenAI and Anthropic are trying to strengthen customer relationships through enterprise agreements and personal AI agents, including OpenAI Dots and Claude Duet.

Nevertheless, growing competition could eventually push costs closer to the actual cost of running AI models.

While major AI firms face increasing pressure to improve performance and maintain profitability, if current trends continue, developers could benefit from further reductions in AI usage costs. Stay Connected with ProPakistani.

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For now, openAI and Anthropic Slashed AI Model Prices by Up to 80% remains the part of the story worth watching, and further updates are likely as more details are confirmed.