AI companies are shifting the focus of their competitive strategy from performance to cost, Axios reported on Sept. 22.

OpenAI unveiled GPT-6 Sol and GPT-6 Luna on Sept. 22, the report said. It cut prices 50 percent compared with earlier models. Anthropic also released Opus 5.5 the same day. The company said it keeps top-tier intelligence while costing about 40 percent less to run than Opus 5.

xAI, led by Elon Musk, also unveiled Grok 4.7 on Sept. 21, highlighting performance relative to price.

The price war could be a burden for OpenAI and Anthropic. Axios said the two companies need to sustain growth in customers and revenue to justify multi-trillion-dollar valuations.

But price cuts are a positive signal for the broader AI boom. As model prices fall, usage is rising sharply, which could help justify multi-trillion-dollar investment, the report said.

Citadel Securities said in a report provided to clients that falling cost per token is driving additional use and lifting overall AI spending. Morgan Stanley also sees competition with Chinese companies as a positive. It sees broader computing demand rising as more customers use cheaper AI.

Axios said it is in the same context as the "Jevons paradox", in which consumption increases when resource prices fall due to technological progress.

Chinese companies focused on open-weight models are also gaining ground. DeepSeek released V4.1 Flash in September. DeepSeek said the model outperforms its previous flagship model across multiple benchmarks while being cheaper. V4.1 Flash rose to No. 1 in the OpenRouter rankings as usage jumped 172 percent this week.

A strategy of cutting prices to gain market share is not new. AI companies have lowered prices on older models after launching new ones or released smaller, cheaper "Flash" versions. Axios said the push by open-weight model companies is fuelling cost competition across major AI labs.