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Re:LLMs Are Cheap by raincole on Monday June 09, 2025 @10:50AM (#44225102)
> an API that is likely a loss-leader to grab market share (hosted LLM cloud models)

Everyone just repeats this but I never buy it.

There is literally a service that allows you to switch models and service providers seamlessly (openrouter). There is just no lock-in. It doesn't make any financial sense to "grab market share".

If you sell something with UI, like ChatGPT (the web interface) or Cursor, sure. But selling API at a loss is peak stupidity and even VCs can see that.

Re:LLMs Are Cheap by mupuff1234 on Monday June 09, 2025 @10:55AM (#44225146)
Except they most likely do have a plan to make it harder to switch.
Re:LLMs Are Cheap by raincole on Monday June 09, 2025 @11:35AM (#44225554)
Yeah, sure, please elaborate on how providers such as Fireworks, DeepInfra, Chutes are going to "make it harder to switch."
Re:LLMs Are Cheap by mupuff1234 on Monday June 09, 2025 @12:37PM (#44226250)
I'm talking about openAI, anthropic, Google, etc.

They'll offer consumer and enterprise integrations that will only work with their models.

Re:LLMs Are Cheap by hedayet on Monday June 09, 2025 @12:45PM (#44226332)
yes. And they will try both carrots and sticks.

The carrots are already visible - think abstractions like "projects" in ChatGPT.

Re:LLMs Are Cheap by DarmokJalad1701 on Monday June 09, 2025 @11:42AM (#44225629)
Who is "they"? It makes no sense for Openrouter to allow providers that do not conform to the API. They profit from the commission from the fees and not providing inference.
Re:LLMs Are Cheap by zdp7 on Monday June 09, 2025 @02:43PM (#44227770)
You can't switch to a competitor that went out of business. If you low ball your rates, it starves startups of needed funds
Re:LLMs Are Cheap by julianeon on Monday June 09, 2025 @06:57PM (#44230511)
This is also the argument of the guy in the article, fyi (it's not a loss leader, no reason for it to be).
Re:LLMs Are Cheap by raxxorraxor on Tuesday June 10, 2025 @02:34AM (#44233352)
Depends on the business case. LLM slowly creep into several workflows and here determinism becomes more important than the latest abilities in reasoning.

People start to let their LLM parse text content. Be that mails, chats or transcriptions, the models often need to formalize their output and switching models can become burdensome, while developers might switch models on a whim.

Doesn't mean you can capture a market by selling cheap though.