The companies that own the customer relationship will ultimately beat those that simply own the best AI

The economics of frontier AI are starting to crack, and nowhere is that more clear than at Anthropic. As the company heads towards what could become the biggest IPO ever, it faces an ominous signal: Many of its U.S. customers are choosing cheaper artificial intelligence models over its most advanced option. That matters because it is testing a core commercial assumption underpinning frontier AI: that the most advanced models will continue to command a price premium. It’s an assumption that in...