Tech Companies Try Cheaper AI Models

The AI boom used big and expensive models. Now companies looked at cheaper models. Brian Armstrong from Coinbase made a prediction. He said 80% of AI work will use cheap models in 12 to 18 months. Only 20% of work will use the most advanced models. This will be a big change for the AI industry. Most AI companies competed on quality. They used the most advanced model for everything. But now costs are high. Users will look at cheaper models. A company called Harvey did a test. Harvey is a legal AI tool. It worked with Fireworks AI. The test used a cheap model for easy tasks. It used a big model for hard tasks. The result was good. The cost went down by three times. The quality did not change. Gabe Pereyra from Harvey said quality is first. But the definition of quality is changing. Now companies want the best model for each job. The real question is big models versus small models. Companies can save money with small models. They can use GPT-5.4-mini or DeepSeek V4 Flash. There is a price war between big labs and small models. This is new for the industry. Before now, companies used only the biggest models. Now they will try smaller models. It is not clear what will happen. But the change will be significant.