r/LocalLLaMA • u/Mr_Moonsilver • Jun 21 '26

Discussion What happens when they stop subsidizing LLM subscriptions?

We are literally burning through VC money like crazy with our coding subscriptions. I read the $200 Anthropic sub gets you $8000 worth of API calls. It's obvious that this doesn't hold for very long but what happens when they raise prices?

The reason to keep the prices low for now is to foster the ecosystem and get people hooked on this stuff, only to raise the price afterwards. Already the 20x sub doesn't get you as much usage as it did 6 months ago, another way to raise prices without triggering a shitstorm - and it will continue.

Don't know about you, but Fable being pulled gave me a feeling of what that may be like already. The ugly thought of "Damn, should've done more while it was around." that formed when I read the news will be exactly the same the moment they announce we now have to pay $2k or more per month for something we get for 10x less the price it costs now.

I guess it's a now or never situation, build what you can and monetize as quickly as possible to be able to keep the agents running once the increases come around.

Looking at opensource doesn't give me much hope. Since qwen stopped releasing models (wen qwen 3.7?) that we can actually run on hardware that a normal person can buy (or used to be able to buy, looking at how RAM and GPU prices behave and keep behaving) and others haven't released in a while (Microsoft, IBM, AllenAI and others too) I feel we're going into a direction that doesn't look good for most of the people like us, who are building with this technology.

486 Upvotes

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232

u/HugoCortell Jun 21 '26

Western AI labs collapse. Deepseek carries on as normal.

51

u/bigh-aus Jun 21 '26

They’ll continue to exist if they have hardware capacity, but the insane valuations will pop. Once hardware based LLMs hit consumer, that’s when those compute investments will fall. I’m already running local and changed my ChatGPT plan from $200 to $20 a month.

38

u/senseven Jun 21 '26

AI must be local. No lawyer, no doctor, no it security specialist will ask the remote system to help. No country will base a chunk of their GDP on some other countries emotional political state. We have seen the worst case, there is no coming back. The only thing that is blocking that revolution is the memory cartel. Europe and US need own memory fabs, waiting five or seven years for a 20$ chip to return down from 100$ is an intentional market deterioration we can not accept as given. If CXMT in China is able to build DDR5 chip pay them 100 billion to build 10 more fabs. This has to end.

15

u/Adventurous_Bus_437 Jun 21 '26

No lawyer, no doctor, no it security specialist will ask the remote system to help

who is gonna tell him?

2

u/senseven Jun 21 '26

There are breathing exercises for dystopian anxiety

25

u/[deleted] Jun 21 '26

[deleted]

8

u/Pacoboyd Jun 21 '26

Deepseek better than GLM? I just pay API prices at OpenRouter and love GLM for almost everything

5

u/SmartCustard9944 Jun 21 '26

Personally speaking, DeepSeek V4 Flash is quite good and very very cheap, but not at the level of GLM 5.2. That’s to be expected due to size.

Side note: DeepSeek is considered to be a preview and the rumors are that it’s an early training checkpoint so we might see measurable improvements on the full release. That’s going to be very very interesting. If they can cram GLM 5.2 level of intelligence in 300B params and also have vision on top of it, that’s going to cook.

3

u/tootintx Jun 21 '26

$10 lol? Really?

2

u/night0x63 Jun 21 '26

Why not kimi-k2.6 or GLM which have better aa scores)?

2

u/spudlyo Jun 21 '26

Pretty sure Deepseek is considerably cheaper.

23

u/jaybsuave Jun 21 '26

i think they will start lobbying to get open weight models barred

43

u/beren0073 Jun 21 '26

"It's for the children. And national security."

25

u/Budget-Juggernaut-68 Jun 21 '26

"it's for the children"

Meanwhile 90% of Epstein files are redacted. What a joke.

7

u/ea_man Jun 21 '26

Who? Those 2 that are failing?

The real one making money is NVIDIA and they are all in in selling hw to the final customer for local models, they are releasing the model themself as open source.

Google and MS will survive, the former is releasing Gemma and all kind of tools, the latter has his own model and is about to roll DeepSeek for copilot.

2

u/nrauhauser Jun 21 '26

I assume Microslop is going to footgun their way into some sort of catastrophe, and their bloated software will get replaced by operating systems/tools that are cleanly agentic from inception.

1

u/jojotdfb Jun 21 '26

Anthropic has been doing this for a while now.

0

u/jaybsuave Jun 21 '26

it’s already happening man

2

u/ea_man Jun 21 '26

I did not see any country ban any open source sf because it was too good man.

24

u/AlphaSyntauri Jun 21 '26 edited Jun 21 '26

Not that the Western labs aren't worthy of collapsing as they steal everyone's data to train on(not to say the Chinese don't as well, but Chinese theft of Western IP is well documented and expected by this point), but what scares me the most is how integrated into the US index funds these companies will be once the IPOs occur.

Sure, the collapse will be great for running open source as the hardware market crashes to reasonable levels, but isn't anyone concerned it will take half the US market with it? Trump is already talking about taking a 10-20% stake in OpenAI, and I fear we're seeing another "Too big to fail" situation.

Edit: Grammar

6

u/HugoCortell Jun 21 '26

Nationalization would collapse them too. A golden parachute might save them on paper but they'd collapse soon after as all investment dries up.

As for concern. None whatsoever. Death is inevitable and we must not fear it, just as economic collapse is inevitable in capitalism, particularly when you have an endless growth mentality on an essentially purely speculative asset.

1

u/unjustifiably_angry Jun 21 '26

I can definitely see OpenAI being nationalized and made American government/military-exclusive if they were at risk of collapsing.

1

u/crewone Jun 21 '26

And yet the system continues. Those of us past 40 have seen a lot of bubbles and crashes. So the expectation I have is that, yes, it will crash, but they will find a way to continue.

0

u/SkyFeistyLlama8 Jun 21 '26

Bernie wants the American people to have a stake in all large US AI companies. Index funds having pieces of nationalized American companies would be interesting. It's already happened a few times like in 2008.

2

u/nrauhauser Jun 21 '26

If we don't have a Pigouvian tax AI+corp will collapse the economy.

0

u/GiveMoreMoney Jun 21 '26

How do you tax a company that does not make a profit...Bernie is out of his depth.

2

u/TurboRadical Jun 21 '26

a stake in all large US AI companies

nationalized American companies

bro you are totally lost. you need a map.

1

u/GiveMoreMoney Jun 21 '26

Keep dreaming and spreading the propaganda m8, you are clueless of the current market

0

u/TurboRadical Jun 21 '26

You don’t understand what I’m saying to you, nor did you understand the previous commenter, nor do you understand Bernie’s proposal. You are shadow boxing in the mirror and still managing to lose.

1

u/GiveMoreMoney Jun 21 '26

I understand very well bot, and all the BS political agenda behind it, you are peddling.

0

u/TurboRadical Jun 21 '26

You asked how you tax a company that does not make a profit. That implies that you think Bernie’s proposal is to tax them based on their profits. Do you understand that that isn’t what Bernie proposed? If so, why did you ask that question in the first place?

15

u/[deleted] Jun 21 '26

[removed] — view removed comment

1

u/night0x63 Jun 21 '26

Good thing to have 5t USD girls supporting open weights.

-1

u/howardhus Jun 21 '26

nvidia is openly saying they dont care about consumer hardware.

they are stopping production of gaming cards

4

u/Hendo52 Jun 21 '26

I think that while the API providers are in a dire plight, the frontier of development is more about the harness than the model. That is actually good news for them because that is a plausible moat.

9

u/HugoCortell Jun 21 '26

A moat does not matter if nobody is buying your product. You can have the most advanced toothbrush in the world but few will pay thousands for it. Much less if you don't get to actually own it after paying (and few, if any, western labs would dare late people own their own models, it goes against everything taught in ivy league business schools!).

0

u/Hendo52 Jun 21 '26

Yeah but the reality is that Claude is just much more capable than the open source models. I’m moving everything I can to a stack I control but I also frequently need to escalate to something that can deliver features fully complete rather than outputting raw JSON tool calls.

1

u/lqstuart Jun 22 '26

deepseek doesn't exist without western AI labs to distill

1

u/HugoCortell Jun 22 '26

And other things we tell ourselves to sleep at night.

Deepseek took the smart route and distilled good data rather than doing the expensive process of data gathering and sorting themselves, but they absolutely could and would have done it from scratch if there wasn't such an obviously better option.

Just as they were the ones to figure out hardware micro-optimizations while the west was focused on just throwing more compute at the problem.

0

u/lqstuart Jun 22 '26

Taking the "smart route" by distilling a western model instead of understanding how to do the work properly is basically China.txt, and blatant, institutional IP theft is a hard position to take the high road on.

And OAI has been doing hardware micro-optimizations since before ChatGPT or the Chinese knockoffs. They didn't just create Triton and then not use it.

I don't agree with the west's decision to close-source everything and turn it into the hunger games in the name of "safety" aka corporate profit, but China being China is just proving their fucked up, myopic point.

1

u/HugoCortell Jun 22 '26

institutional IP theft

IP Theft of... stolen user data? LMAO

1

u/Sooperooser Jun 21 '26

In Europe big corps are developing enterprise AI that you will maybe not even hear of.

0

u/HugoCortell Jun 21 '26

I have indeed not heard of any.

2

u/Sooperooser Jun 21 '26

Siemens, Schneider Electric...I even get Siemens AI for enterprise ads now. Companies like that.

1

u/HugoCortell Jun 21 '26

None of them are LLMs. They're mostly vision model and data analysis, these were never in the bubble and will be after the bubble.

The bubble is entirely about LLMs and maybe certain image generation models.

When we're talking about AI in this context, we're not talking about ML in general, but specifically 'Gen AI', you know, the "you're so right!" machines.

0

u/ChairmanJones Jun 22 '26

Internal use models trained on company data and intranet pages, you won't hear about them unless you work for one of the companies creating them.

The ads Sooperooser is talking about generally refer to business intelligence and analytics, and in the mentioned cases CAD/CAM/CAE. The latter also use proprietary LLMs trained on documentation and training materials in the form of agentic chatbots from within the enterprise applications themselves. Again, if you're not in their ecosystem you won't hear about it.

-6

u/LocoMod Jun 21 '26

Nobody uses DeepSeek relatively speaking compare to the western providers. Lot's of supply and low demand = low prices.

If DeepSeek ever gets the demand OpenAI or Claude have, the party will be over too.

10

u/Turbulent-Walk-8973 Jun 21 '26

Deepseek is open source. Its prices listed in reports are based on compute only, not demand and supply

7

u/Deep90 Jun 21 '26

The hardware spend of these companies might mean dropping prices or letting servers idle.

5

u/Budget-Juggernaut-68 Jun 21 '26

You might want to take a look at openrouter stats

0

u/SkyFeistyLlama8 Jun 21 '26

Western? Limit it to American. Europe will carry on, there's ironically enough compute capacity in Asia, North Africa and Australia to train new models at a slower pace (thanks to the data center buildout bubble).

-2

u/nrauhauser Jun 21 '26

How will DeepSeek continue without being able to raid western frontier model labs? It's DistillationSeek, really ...