The announcement elucidated this, and it's IMO worse than this. They don't downgrade to a cheaper model ([edit] for certain classes of offense they suspect you of). They sabotage the model's outputs in other, undisclosed, ways (specifically, "prompt modification, steering vectors, or parameter-efficient fine-tuning"). So, for example, they might load in a steering vector that just forgets the API to PyTorch. But it isn't just "we redirected you to a cheaper model!"