TMTPOST -- OpenAI is escalating the price war in large language model (LLM) while seeking partnership with a prominent artificial intelligence (AI) rival to meed its compute needs amid fierce rivaly.

Credit：Alibaba Cloud

OpenAI CEO Sam Altman on Tuesday announced the ChatGPT developer cut costs for both input and output tokens of o3 by 80%. OpenAI released o3 in April, touting its as “our most powerful reasoning model that pushes the frontier across coding, math, science, visual perception, and more.” The company said O3 performs especially strongly at visual tasks like analyzing images, charts, and graphics, and in evaluations by external experts,the model makes 20% fewer major errors than OpenAI o1 on difficult, real-world tasks—especially excelling in areas like programming, business/consulting, and creative ideation.

In a post on social media X on Tuesday, Altman also showed upbeat on o3-pro, an enhanced variant of o3, saying “think you’ll also be happy with o3-pro pricing for the performance.” O3-pro is priced at $20 per million input tokens and $80 per million output tokens in the API. In comparison, the cost of using o3 is now $2 per million input tokens and $8 per million output tokens, with an extra discount of $0.50 per million tokens when the user enters information that has been “cached,” or is stored and identical to what they provided before.

“Like o1-pro, o3-pro is a version of our most intelligent model, o3, designed to think longer and provide the most reliable responses,” OpenAI said in a blog. O3-pro is available in the model picker for Pro and Team users starting Tuesday, replacing o1-pro, and Enterprise and Edu users will get access the week after, according to OpenAI. O3-pro is also live in OpenAI’s developer API on Tuesday.

In expert evaluations, reviewers consistently prefer o3-pro over o3 in every tested category and especially in key domains like science, education, programming, business, and writing help. Reviewers rated o3-pro consistently higher for clarity, comprehensiveness, instruction-following, and accuracy, and academic evaluations show that o3-pro consistently outperforms both o1-pro and o3, per OpenAI.

OpenAI was finalized a deal in May to tap Google cloud service for its growing compute needs, Reuters reported earlier Tuesday. Under the deal, Google’s cloud unit will supply new computing capacity to OpenAI’s existing infrastructure for training and running its models, the report cited sources.

The unprecedented partnership with Google highlighted how the massive computing demands for training and deployment of models is reshaping the competitive dynamics in AI. It is also part of OpenAI’s efforts to reduce dependence on its top investor and key partner Microsoft Corporation. The deal has been reportedly under discussion for a few months and was“previously blocked from signing a deal due to OpenAI’s lock-in with Microsoft.”

Microsoft, with its Azure cloud service, has had exclusively offered computing capacity for OpenAI until January. The software giant on January 21 said it was no longer OpenAI’s exclusive cloud provider, though it now has the “right of first refusal” before OpenAI checks with other parties. OpenAI in January took a marjor step toward diversifying its compute sources with annoucement of the Stargate Project, a joint venture with OpenAI, Oracle and Softbank to invest billions of dollars in AI infrastructure in the U.S.

OpenAI was reported in February to anticipate a major shift in the next five years around whom it gets most of its computing power from. The company expected to get three quarters of its data center capacity from Stargate by 2030, The Information reported. That would represent a reversal from today and the next few years, when its power and data center capacity is mostly handled by Microsoft.