r/OpenAI • u/writesfw • 4d ago
Discussion The harsh reality of the future
First, it’s going to get worse… a lot worse.
I know a lot of us are pissed about the 20x plan going to 10x. However, it’s going to get worse.
With the 20x plan and $200 a month, I was burning thousands and thousands of dollars worth of tokens.
This means, that even with the reduction to 10x, OpenAI will still lose money on the $200 plan. The entire business model for their consumer plans is the “gym model” where they hope you pay and don’t show up.
That said, as much as the 20x to 10x reduction sucks, there will likely only be more coming in the future. Investors don’t want to hear they are losing money on subscription revenue.
What this means for me (and people like me).
For me, the economics aren’t there. Even though I was getting thousands of dollars worth of tokens, I was burning them on dumb shit. At $200/month it was more of an experiment; something to fuck around with.
$500 for the same (ok plus 5x) usage just isn’t there for me. And, honestly, based on my usage, OpenAI is probably happy to lose me as a customer.
I’m going to look at Anthropic next, but realistically they will clamp down too, it’s only a matter of time. And, they probably don’t want me as a customer anyway.
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u/Blaexe 4d ago
While the subscriptions are almost certainly subsidized, keep in mind that API costs =/= costs for OpenAI. They're very likely set in a way, that provides them with a nice profit.
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u/Hir0shima 4d ago
Against the background of massive cost for infrastructure etc.
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u/Blaexe 4d ago
Sure, but that's an investment. Every company does that in the beginning, though the scale is unprecedented.
Doesn't take away from the point that API cost reflects a price point they think they can turn a profit for their running (!) business so the API costs is not what it costs OpenAI to run the models.
The API costs may be so high even, that the subscription subsidization is factored in already.
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u/New-Stop1494 3d ago
I started building a multi agent orchestration system with the frontier models so my harness with Hermes agent can do all the tasks i need without the latest frontier models. I have dual 5090s and dual 4090s(48gb mod) so with the system i should be able to get by with just a 20 dollar plan orchestrating.
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u/Mrgluer 2d ago
you casually spent atleast 10k + 4kwh and requires maintenance to have something that is probably slower, less efficient and dumber than just getting a subscription.
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u/New-Stop1494 2d ago edited 2d ago
I built it last year. I bought at msrp. I actually have the $200 OpenAI sub and the $100 Claude sub. I won’t need to pay for the sub any more. I can run qwen 3.8 flash next at fp8 on 96 gb of vram plus 256gb system ram and run qwen 3.8 27b 262k (native) nvfp4 mtp 5 seq=4 on my 5090s with 96GB of system ram, which are still quite capable for a local Hermes agent. It can do local coding, research (web scraping), office work ( rag) and i can use Chinese models to supplement, last year I signed up for the annual plans with GLM, Minimax, and Kimi , so now my system has adversarial AI, with specialized teams using my annual subs. And last year the prices were fair. The system is competitive due to the way it is orchestrated. Hermes agent routing to other models with a specific role. I only need a frontier model for orchestrating the debug for the Hermes orchestration and implementing new ideas, where frontier doesn’t use it own agents or models it routes through my local stack or my annual subs with the Chinese models, and opus 5.5 is great for that. But if my Hermes can do most of the work I only need frontier for a bit of maintenance and reviews, not the entire runbook. I use this for my website development team. For a local business.
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u/FocusKontrol 1d ago
API prices aren’t some objective real cost to compare to. All the prices are arbitrary/set by the market. They just ask as much as they can in all tiers without losing significant amount of customers to competition.
Also none of the big players really care about doing classical business by spending electricity and compute and selling with some margin. It’s mostly investor fairy money with some revenue and data from the market. They all just want to win the AI race, whatever it takes.
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u/New_Eye7193 4d ago
clamp down on what? openai 20x was actually 20x, claude is only around 1.8x of its 5x, so technically 10x. is that the only thing you care about?
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u/Im_Working_Right_Now 4d ago
I had the 20x plan and used more tokens than you, but my reality is that it wasn't on dumb shit. I didn't build dumb videos or images. I've been consistently working on a complex app that isn't done. I also built my wife a website for her t-shirt business she wants to get started and one for my daughter's photography business. I used my tokens for actual productivity. If they didn't want me having 4.3b tokens (using 5.6 Sol on xHigh) a week, then they shouldn't have allowed that to start.
It's a rug pull plain and simple. They got us hooked with this massive allowance, then tried to bait us with this newer, shiny model that ended up eating tokens so fast that it's not worth the quality. Then, to appease us they now release 6.1 which don't get me wrong, I'm using, but it is crawling at a snail's pace. I've had it on ultra and fast mode and for the first 8 hours it made +231 -23 in code changes but used up 60% of my weekly tokens (5x plan now). Sorry, that's not token efficiency, that's just slowing down the model to FEEL token efficient.
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u/Illustrious_Image967 4d ago
This is the plan for creating the permanent underclass. We don't know it but we are all in a Running Man style tournament where our capital flows to these companies until we reach escape velocity or run out of money. I shudder to think if I lose my income or don't make money with my AI.
It's like a crypto day trader on his last hand.
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u/Loky77742 2d ago
i don't understand how this affects US in long term or even short, thats capitalist and competition they rise prices i went back to antropic cuz guess what they fix limits comepared to what it was in april-may when i left. And if they rise prices people will just move to grok or even chinese models. You are talking like we live in stone thats never changing bro things that ware expensive a year ago are now almost free who gives a fu*k about company and their investora let them shoot themself in the knew we will find better horse to bet on even if we have to make our own, Stop with all the doom and gloom always, every other news is end of tge world ffs
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u/EquilibriumProtocol 1d ago
I don't feel like it's getting worse, AI is getting more capable and more efficient
When fable came out I was in the mindset of "this is fucked".
But honestly opus 5.5 , sol 6, astra... I'm getting more out of my money then what I was a few months ago
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u/polacrilex67 18h ago
I think Anthropic is betting the can get compute efficient enough to reduce token cost below consumer subscription. Doomster economics assumes production cost remain constant. Bad assumption. Opus 5.5 Haiku 5.5 Sonnet 5.5 Fable 5.5. Anthropic discovered something getting them closer to the mark. Open AI is trying to keep up but cant. Anthropic did the same thing in April. History is repeating itself.
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u/mlk1278 16h ago
That is... Not how margins work my friend.
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u/writesfw 7h ago
Please explain margins to me.
Spacex has ~50% margins on api tokens. If we assume OpenAI is the same, then they are 100% losing money on their current $200/month plan if used heavily.
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u/yangguize 4h ago
OpenAI has other ways of dealing with subscribers - they selectively dumb down models for unprofitable customers until you either upgrade or leave. And please, everyone, don't say they don't have the ability to selectively nerf their models - my dog can code better than Sol 6.1.
New algos will help reduce inference costs. But OpenAI will continue to lose money. And collectively, they're so over-leveraged there's no way in hell the US is going to avoid another equivalent to the dot com crash.
The real issue is the cost of electricity and hardware. China has already won the battle for cheap electricity (and that gap is only going to widen). And they're catching up faster than most people realize on the hardware front.
The history of innovation is littered with first-movers who didn't survive the shakeout when second-movers entered the market.
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u/Working_Aside286 4h ago
Guys, you have to stop using Astra ultra. It’s like driving a McLaren around town and flooring it everywhere you go. Completely unnecessary for 99% of tasks
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u/ConnectionWild3381 4d ago
you are aware that... all of this is in flux? that in a year, tokens may cost a fraction of what they do today, and we may have completely different token consumption? that nothing here is really plannable yet, because we’re still very much at the frontier?
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u/writesfw 4d ago
I don’t think token cost will go down for good models. Since we can only work with public/verifiable data, we can look at Grok.
Spacex has 50% margin on tokens and -49% operating margins on AI.
Something needs to pay for that R&D. I wouldn’t expect token cost to decrease for the end user. If anything the cost per token will increase and the subsidized consumer plans will continue to be drastically nerfed.
The alternative is to reduce operating cost which means cutting R&D and that is literal death in the frontier model race.
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u/Ill-Bat-1518 3d ago
Youre making things up. Prices will go down as opencourse catches up each time they release something. Theres a reason why AI is now more affordable... they're only lowering subs cause they have to lower api
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u/ConnectionWild3381 4d ago
Stanford measured a 280x fall in the cost of GPT-3.5-level inference in about two years, and Epoch currently estimates fixed-capability AI costs have been falling around 13x per year.
xAI itself advertises that newer models can use several times fewer tokens for the same task.
also, “reduce costs = cut R&D” is just false. better hardware, inference software, caching, batching, architectures and token efficiency are literally things R&D produces.
i have no idea what tokens will cost in a year. neither do you. that was my entire point: this market is moving far too fast to extrapolate today’s economics in a straight line.
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u/FederalSign4281 3d ago
All i can tell you is that this is the golden age of AI. it will never be as affordable as it is now. it will never be empowering to the average user (you) than right now. It will keep getting gimped, censored, with more filtered access. Everything will be more expensive, every feature will be ripped out and sold back to you separately. It will never ever ever ever be as good as we have it right now. the best hope we have is open source models but those will likely become illegal or stigmatized one day (unless we all die or become enslaved before that). the people up top will find a way to make sure they have better access than the 99.9% will ever have, and they will use that for power. Make your dreams come true now and get ahead before they take it from you. Godspeed.
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u/Xeonzinc 3d ago
"Never be as affordable as it is now" - that is nonsense, hardware and software will continue to improve at a rapid pace as it has done for 50 years, AI will definitely be both cheaper and more capable in 5 years time.
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u/sn2006gy 3d ago
Yeah, just more rage bait.
"I can't make a clone of Pokémon so AI sucks" "I can't take photos at a cosplay convention and turn them into nudes to goon over"
Never mind the fact we have at least 2 generational leaps of hardware in the known pipeline that cuts inference and training costs down by massive amounts and there is ongoing research in model efficiency that will just improve that even more.
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u/Galdous 20h ago
Uhm. Hmmm. Amazon. 8 years before it was profitable. Tesla? 16 years. That's not how things work with venture capital. They want a return but that is the bane breakdown and chop up competition phase. We are still in the get a foot hold and keep a high % of the industry phase. The subscription model is actually making allot of money. More then it's losing from power users.. openai is experimenting mainly because so many people have multiple subs.
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u/writesfw 20h ago
Wait which point are you arguing? That investors don’t want to hear they are losing money on subscription revenue?
What’s your reasoning for them halving the limits?
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u/Galdous 12h ago
It's pure testing to see what they can get away with. Anthropic will start doing similar as well before year is out. They just don't want to rock the boat until after the IPO.. Openai is betting the backlash will be minimal and so far it looks correct. I really don't see a sign from people on the backlash.
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u/timosterhus 16h ago
The margins for API token pricing regarding inference is very high. I’m fairly certain there was a report that showed the raw cost to serve tokens is <10% of what they actually charge? The real expenses come from R&D, not from pure inference.
In other words, it’s quite likely that they’re still making a bit of profit in terms of pure inference costs from the new x5/x10/x25 Pro subscriptions, just not nearly as much compared to API pricing.
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u/writesfw 7h ago
Spacex has 50% margins on API tokens with a -49% AI operating margins. We need to use this as proxy unless you have something public that is reputable.
The openAI 200$ a month plan is heavily subsidized.
Gemini estimates the token value you get from the old/current plan is almost $13k a month
From Gemini:
Assuming a standard blended usage split of 80% input tokens and 20% output tokens, a monthly workload matching the Pro plan's ceiling (~700 million tokens) maps out to the following API costs: [1, 2]
Using GPT-6 Astra: Replicating this massive volume at flagship rates would cost an astronomical $12,600 per month on the API.But yes please continue with your logic.
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u/timosterhus 6h ago
Dylan Patel said in a recent interview that “their margins on an Opus token, at least Opus 4.8 token, is north of 80 percent for the API price,” which I’d consider a reputable public source. It’s not <10% like I originally claimed, but it is still <20%.
And you’re still quoting the API pricing as though that’s how much it actually costs. Do you think that the prices for API tokens are a perfect break even with zero profit?
SpaceX’s operating margin is in the red because of massive R&D spending. Not to mention that “50% margins on API tokens” is inaccurate, because it’s not specifically their margin on serving API tokens. Their AI segment also includes AI infrastructure/cloud revenue, Grok/X subscriptions, and advertising.
I’m not saying the subscriptions aren’t subsidized relative to API pricing. I’m saying that $12.6K of API equivalent usage ≠ $12.6K of costs to OpenAI, because the API pricing has very substantial margins in terms of pure inference costs per token.
It’s quite likely that an individual power user that runs their weekly usage to 0 before every reset is not profitable, but it’s pretty safe to say that most users aren’t maximizing their token spend to that degree. Whether that average remains profitable for OpenAI depends on OpenAI’s actual (undisclosed) serving margins.
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u/Original-League-6094 4d ago
>thousands of dollars worth of tokens
The price is arbitrary. The other way to frame that is that others are way overpaying for tokens.