AI's price war could be a win for hyperscalers, Citadel says
QQQ•Citadel Securities says falling AI token prices and rising use of open-weight models may favor hyperscalers that control computing infrastructure. Consumption-weighted token prices fell about 50% in six months as token volumes rose roughly fivefold; Nvidia B200 GPU rental rates rose 27.5%.
1. Prices fall, usage climbs
Consumption-weighted AI token prices fell about 50% over the last six months, while average frontier-model token prices dropped 62%, Citadel Securities head of macro strategy Frank Flight said in a note. Token volumes rose roughly fivefold as lower costs coincided with accelerating inference demand.
2. Infrastructure in focus
Flight wrote that open-weight models may pressure frontier-model margins over time as cheaper models become good enough for more enterprise tasks. Ramp data showed little growth in overall enterprise AI spending in August and September despite rising usage. Rental rates for Nvidia B200 graphics processing units rose 27.5% over the past six months; Citadel Securities likened frontier AI labs to airlines and hyperscalers to airports, arguing infrastructure providers may benefit from inference demand.
