The Unsustainable Subsidy | Tomasz Tunguz

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The Unsustainable Subsidy

May 20, 2026

AI

Google’s AI triples in price each year.

Google Gemini: Flash and Pro Pricing

OpenAI’s flagship model was seemingly subsidized for a while, before rising again.

OpenAI API Prices: Flagship Falling, Then Rising Again

Anthropic’s AI has been the same price for a little bit & decreased for the most powerful models.

Anthropic API Prices: Opus, Sonnet, Haiku

Those are three very different pricing strategies. If we compare the absolutes, the data completes the picture.

Vendor | Model | Input ($/1M) | Output ($/1M)

Google | Gemini 3.1 Pro | $2.00 | $12.00 Anthropic | Claude Opus 4.7 | $5.00 | $25.00 OpenAI | GPT-5.5 | $5.00 | $30.00

Google remains the low-cost player, increasing the price on all its models but still less than half of the competition. Anthropic had maintained a luxe pricing until late last year.

The pricing changes indicate changes in strategy : cuts when cash is plentiful & share matters. Increases when cash is tight & margins matter. The latter is the case for all three vendors now when capex spending continues to set records.