Not a discount at all. Every dollar for a rented service is being flushed down the toilet. Industry is moving to local llms, the government should have been ahead of them.

If the service provider goes under, the govt wasted their money.

...no? Whatever value they got from inference they already did is still there? Of course the government still needs to worry about vendor lock-in, but they'd have to do that no matter what, and also general-purpose LLMs are relatively replaceable for most use cases.

If the company has a sustainable business model it will be profitable and hang around without jacking up prices. If not, you wasted time and money setting up the anthropic tool chain.

Given the statements in their SEC filing, it's not outlandish to consider the possibility of a long-term plan to make Anthropic models a nationalized, public utility before they go bankrupt.

If GSA is already considering vendor lock-in as they establish new public services across multiple agencies, the natural move is to build them to eventually transition to a federally-owned and operated provider. Especially with how involved the U.S. government is in limiting capabilities Anthropic provides to consumers today.

Except that work would be cheaper to set up and the cost would drop over time if they were using local llms. Every dollar paid to a 3rd party rental service is a dollar that is burned in the fireplace. We are paying more for the right to be stuck paying more forever, it's ridiculous.

Why would the government use local LLMs? Compute is a central example of the kind of thing that makes sense to outsource.