Distilling AI Models Costs Less, Raises Revenue Questions
Developers can access AI model capabilities at a fraction of the price thanks to distillation, allowing app developers to run AI models quickly on devices such as laptops and smartphones. The technique uses a "teacher" LLM to train smaller AI systems, with companies like OpenAI and IBM Research adopting the method to create cheaper models. However, experts note that distilled models have limitations in terms of capability.
- This trend highlights the evolving economic dynamics within the AI industry, where companies are reevaluating their business models to accommodate decreasing model prices and increased competition.
- How will the shift towards more affordable AI models impact the long-term viability and revenue streams of leading AI firms?