Will Tech Companies Switch to Cheaper AI Models?

The rapid development in the field of artificial intelligence (AI) has long relied on one core concept: the larger the model, the more powerful it is and the more likely it is to dominate the market. However, the industry is now witnessing a shift in this perspective. High costs are forcing users to focus on smaller and cheaper models. This economic approach could completely transform the future of the sector. According to Techcrunch.com reports .

According to a prediction by Coinbase co-founder Brian Armstrong, within the next 12-18 months, 80% of tasks will be performed by models that are 99% cheaper. Only the 20% most complex tasks will remain on the latest generation flagship models. If this happens, major laboratories like OpenAI and Anthropic could face serious financial losses ahead of their IPOs, as the main revenue stream shifts to cheaper alternatives.

Initial tests show that if the system is properly configured, cheaper models can replace larger ones without compromising quality. For example, the legal AI service Harvey, in partnership with Fireworks AI, achieved a threefold reduction in costs by jointly using Claude Opus and GLM 5.1 models. In this setup, the heaviest tasks were assigned to the large model, while the rest were handled by the smaller model.

As Harvey co-founder Gabe Pereyra noted, the concept of quality no longer means using the most powerful model for everything, but rather obtaining the most accurate answer in the most efficient way. This trend is intensifying competition not only between open and closed models but also between large and small models. Users are now preserving both quality and budget by choosing cost-effective options like GPT-4o-mini instead of GPT-4o.