I use free AI but of course the hyperscalers are counting on companies paying a high price for complex corporate AI uses.

What would happen to the share prices of the AI companies if free AI was available to all?

wsj.com - Cheaper AI commodity openai anthropic


AI’s Wider Availability Is Good for China, Not Great for OpenAI and Anthropic
Intelligence ‘too cheap to meter’ could threaten the leading AI labs, while creating opportunity for their competitors

By Christopher Mims, The Wall Street Journal, Updated July 17, 2026

…
AI is becoming a widely available commodity…

On Thursday, Chinese leader Xi Jinping gave a speech in Shanghai advocating for the ongoing release of “open-weights” AI models—the kind that anyone can modify and use freely—as a counterbalance to U.S. dominance in AI. And now Chinese models including GLM 5.2 and Kimi K3 are catching up to the best that U.S. tech companies have to offer.

Second, Meta Platforms showed the world it could potentially compete with the two leading AI labs, OpenAI and Anthropic, on their own turf, delivering high-performing models for the lucrative coding market.

And third, the current computing-power bottleneck appears set to ease as more data centers come online, and engineers figure out how to deliver AI more efficiently. For some applications, the supply of tokens—the basic unit of AI use—is catching up with demand…

As for enterprise customers, Chinese AI models can now match the leading U.S. models by some measures, at far lower cost. On the OpenRouter leaderboard, which tracks business consumption of AI tokens on its platform, the top five models are all Chinese, and approximately 45% of all tracked tokens now flow through Chinese models…

Customers of the AI companies are finally getting their heads around this tech, causing them to reassess how much they spend on AI and which of the premium models they actually need. OpenAI and Anthropic are contemplating a price war. Meanwhile, SpaceXAI, Meta and the Chinese companies proliferating open-source models—free for anyone to run on their own hardware—have in effect already kicked off that price war… [end quote]

Commoditization. Price war.

Sounds familiar? Think about what that did to Intel’s stock price when they invested billions in fabs and the supply of chips exceeded the demand.

Most of the huge earnings reported by members of the AI ecosystem are to each other. Only 15% is to end users.

And what about the earnings from end users if they turn to lower-cost or even free AI?

Adoption of any new technology usually follows an “S” curve of early adopters → rising adoption → plateau. That itself is much more conservative than the exponential growth projected by the AI hyperscalers.

But that doesn’t include pricing and earnings. If AI becomes commoditized the earnings curve could collapse even as the hyperscalers are spending huge bucks to build data centers.

If the earnings curve collapses the stock prices will collapse.

Wendy