GoKawiilEpoch AI report: AI inference costs falling faster than Moore's Law
AI research firm Epoch AI has published a report finding that the cost of running AI models has dropped by thousands of times over the past several years, at a pace it calculates as nearly 50% cheaper per quarter and 13 times cheaper annually. The firm says this rate of decline outpaces historical cost drops in lithium batteries, DNA sequencing, and computing power under Moore's Law.
GoKawiil's interpretation of the reporting above, not reported fact.
Such rapid price drops could make it harder for AI providers to lock in customers, since a cheaper, more capable alternative may arrive within months, according to the report's framing. This dynamic could complicate efforts by labs like OpenAI and Anthropic to build durable profit margins around frontier models, as any competitive edge may prove short-lived. At the same time, falling costs are likely accelerating broader adoption of AI tools across industries.
- Epoch AI says AI costs are falling nearly 50% per quarter, or 13x annually.
- This decline reportedly outpaces historical drops in lithium batteries, DNA sequencing, and Moore's Law-era computing.
- The trend raises questions about whether AI labs can sustain profit and customer loyalty amid rapid price and capability shifts.
Source: tomshardware.com — Jon Martindale, 2026-09-30
Published there as: “The price of AI is crashing faster than the rate of Moore's Law, report suggests”
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