Key Takeaways
- OpenAI’s latest model costs ten times more than expected.
- Peter Thiel-backed Sentient claims its open-source AI search model is outperforming OpenAI’s GPT-4.
- China’s DeepSeek has set a new benchmark for cost-effective AI, putting pressure on American firms to balance power with affordability.
OpenAI’s new O3 reasoning artificial intelligence model has had its estimated running price increase tenfold, marking another warning that U.S. AI is becoming too expensive.
Meanwhile, Peter Thiel-backed U.S. startup Sentient has announced an open-source AI search framework, which it claims is America’s “DeepSeek moment.”
DeepSeek disrupted the AI industry in January with the release of R1, a ChatGPT-like model that operated at a fraction of the cost of OpenAI’s and Google’s offerings.
OpenAI’s Price Increase
In December 2024, OpenAI partnered with the creators of ARC-AGI, a benchmark designed to test leading AI, to showcase its O3 model’s abilities.
The benchmark initially estimated that O3 would cost around $3,000 to solve a single problem from ARC-AGI.
However, last week, the ARC Prize Foundation, which maintains ARC-AGI, updated its estimates to around $30,000 per task, TechCrunch reported.
The updated pricing highlights the reality of how much money AI is costing Western companies and, in turn, how much consumers will be paying.
In March, The Information reported that OpenAI could charge up to $20,000 monthly to access its specialty AI “agents.”
Sentient Unveils U.S. DeepSeek Moment
On Tuesday, April 1, U.S. AI development lab Sentient announced the public release of Open Deep Search (ODS).
In a statement shared with Decrypt, Sentient’s new models challenge the “dominance of closed AI systems” as the U.S. approaches its own “DeepSeek moment.”
San Francisco-based Sentient claims ODS, an AI search framework, can outperform closed-source competitors such as OpenAI.
Sentient co-founder Himanshu Tyagi told the publication that the testing of its models “relied on their retrieval systems” by excluding “ground truth” sources such as Wikipedia.
If the search query fails, the model uses “enhanced query rephrasing, multi-pass retrieval, and intelligent chunking and reranking of web pages,” Tyagi told the publication.
Rising AI Costs
The runaway success of China’s DeepSeek highlighted the heavy capital requirements behind building advanced AI models like ChatGPT.
ChatGPT, for example, is estimated to cost OpenAI around $700,000 daily to run, but recent reports suggest a single query can now cost over $1,000 in 2025.
In comparison, DeepSeek claims it costs under $6 million to build an AI model using Nvidia’s weaker H800 chips.
Shortly following its release in January, DeepSeek’s mobile application raced to the top of the U.S. Apple App Store charts.
Kurt Robson is a London-based reporter at CCN, specialising in the fast-moving worlds of crypto and emerging technology. He began his career covering local news in Cornwall after graduating from Falmouth University with First Class Honours in Journalism. There, he cut his teeth on everything from council meetings to missing swans.
He quickly rose through the ranks to become a frontline journalist at several of the UK’s leading national newspapers. Over the years, he has interviewed musicians and celebrities, reported from courtrooms and crime scenes, and secured multiple front-page exclusives.
Following the upheaval of the COVID-19 pandemic, Kurt shifted his focus to technology journalism—just ahead of the AI boom. With a natural curiosity and a trained eye for emerging trends, he has found a new rhythm in reporting on innovation.
At CCN, Kurt's work focuses on the cutting edge of crypto, blockchain, AI, and the evolving digital world. Drawing on his background in people-first reporting and his deep interest in disruptive tech, Kurt delivers stories that are insightful, entertaining, and human-centric.
