We know they cost much more than this for OpenAI. Assume prices will continue to climb until they are making money.

How do we know that? There is a large gap between API pricing for SOTA models and similarly sized OSS models hosted by 3rd party providers.

Sure, they’re distilled and should be cheaper to run but at the same time, these hosting providers do turn a margin on these given it’s their core business, unless they do it out of the kindness of their heart.

So it’s hard for me to imagine these providers are losing money on API pricing.

source? There have also been a bunch of people here saying the opposite