AI buyers turn to hybrid model strategy

The rapid rise of capable open-source AI models is prompting enterprises to rethink their dependence on a handful of frontier models from companies such as OpenAI and Anthropic, with cost emerging as an equally important factor as performance in AI deployment decisions.

The latest trigger came last week when Chinese startup Moonshot AI launched its open-source model Kimi K3, which ranked close to leading proprietary models on several benchmarks, including coding, while trailing only marginally on overall performance. The model’s popularity was such that Moonshot suspended new subscriptions within days after demand overwhelmed its computing capacity.