Not sure what you're referring to. If you're talking about inference cost for frontier models, that's going up because researchers keep pushing those frontiers, often without considering cost. And while they're subsidized (to gain market share), users have no reason NOT to use the crazy expensive frontier models.

Once the market consolidates, and users get used to the idea of using models that are "good enough" because frontier models are too expensive, there's no reason AI cannot be profitable.

There's not much profit in inference, it's heavily commoditized. There is an illusion of potential profitability because the closed-weight models are currently a step ahead of the open-weight models. However, if you ignore the closed-weight models, then the open-weight models are also getting better every year. In the limit, the open-weight models will end up just as good as the closed-weight models.

AI is an inverse gold rush, the people who are getting rich off it are the people using it. The shovel-sellers are screwed.

> Not sure what you're referring to. If you're talking about inference cost for frontier models, that's going up because researchers keep pushing those frontiers, often without considering cost. And while they're subsidized (to gain market share), users have no reason NOT to use the crazy expensive frontier models.

The price of GPUs and the price of RAM to put in the servers.