Is AI entering a race to the bottom?
For the past three years, AI companies have competed to build bigger, smarter models. Now they may be preparing to compete on price.
OpenAI is reportedly considering significant cuts to the cost of GPT-5.5 as competition with Anthropic intensifies, according to a Wall Street Journal report published Wednesday. The move could mark the beginning of a price war between the industry’s two leading AI startups.
Citing people familiar with the matter, the Journal reported that OpenAI is considering lowering its token charges, the units AI companies use to measure and bill usage of their models.
“OpenAI is considering drastically lowering the prices it charges users as it seeks to win customers from its rival Anthropic. The company is weighing significant cuts to what it charges for tokens, the unit of measurement artificial-intelligence firms use to bill for their products,” the report said, adding that it was “in anticipation of similar cuts the company expects at Anthropic,” according to sources.
The reported discussions suggest OpenAI is preparing for tougher competition from Anthropic, which has emerged as its strongest challenger in the race to build and commercialize advanced AI systems.
The AI Price War: Why OpenAI Is Suddenly Thinking About Lower Prices
OpenAI currently offers consumer access to its flagship GPT-5.5 models through subscription tiers that start at $8 per month and extend to $100 or more for premium plans. Anthropic follows a similar approach, charging $17 per month for an annual Claude Pro subscription and $100 or more monthly for Claude Max.
The pricing discussions come at a time when the rivalry between the two companies is intensifying.
Earlier this week, OpenAI confidentially filed paperwork with the U.S. Securities and Exchange Commission for an initial public offering. The filing came shortly after Anthropic submitted its own IPO paperwork, setting up what could become one of the most closely watched contests in Silicon Valley.
Anthropic has gained momentum on several fronts. The company closed its Series H funding round on May 28 at a reported $965 billion valuation, edging past OpenAI’s $852 billion valuation from March.
OpenAI still holds a major advantage in consumer reach. ChatGPT became the first application to surpass 1 billion monthly users in May, according to estimates from market intelligence firm Sensor Tower. The milestone came roughly three years after ChatGPT launched in November 2022.
For comparison, Google Maps took about five years after launch to reach the same level of monthly usage, based on Sensor Tower estimates cited in the report.
For much of the AI boom, companies competed by releasing larger models, adding new capabilities, and securing access to computing infrastructure. A shift toward lower prices could signal that the market is entering a new stage, one where attracting and retaining users becomes just as important as building the next breakthrough model.
Neither OpenAI nor Anthropic has publicly announced pricing changes. OpenAI did not immediately respond to CNBC’s request for comment.
If the reported cuts go through, AI customers could soon benefit from one of the fiercest competitive battles the industry has seen since ChatGPT sparked the generative AI boom.
