OpenAI and Anthropic Slashed AI Model Prices by Up to 80%

OpenAI and Anthropic cut prices for their top AI models by up to 80% over the past four months, due to growing competition from cheaper open-source models and potential IPO discussions. The discounts, starting in June, reduced API usage costs by 75% or more in some cases. Competitors DeepSeek and Moonshot AI have increased pressure by offering lower-cost models.

OpenAI started the cuts in late June with GPT-5.6 Luna at $1 and $6 per million tokens, later reducing them by 80% to $0.20 and $1.20. Anthropic followed in August, making its Claude Sonnet 5 discount permanent and later cutting Claude Opus 5.5 pricing by 40% to 60%. OpenAI then introduced GPT-6.1 Sol at half the price of its predecessor and reduced cached input pricing to 5%.

The speed of reductions surprised Max Woolf, who tracks AI model pricing, noting a faster drop than anticipated. Cheaper open-source models, like DeepSeek's Flash V4.1 1017 at $0.15, $0.60, and $0.003 per million tokens, respectively, have intensified competition. Despite the cuts, AI model prices could fall further if competitors maintain performance and pricing while offering easy service switching.