Event: OpenAI

DeepSeek has slashed prices on its artificial intelligence models, including its latest V4 which now costs 97 per cent less than OpenAI products, potentially triggering a price war in the highly competitive AI market.DeepSeek said on Sunday that it would reduce prices for “input cache hits” – where previously processed context was reused – for application programming interface (API) users to one-tenth of the original level, bringing the minimum input cost down to about US$0.14 per million tokens.DeepSeek said the cuts were effective immediately and would be permanent.To promote the new flagship model released on Friday, the company offered an additional 75 per cent discount on the V4-Pro model through May 5, it said in a separate announcement on Saturday. The V4 family currently consists of the Pro and Flash variants, with the V4-Pro positioned as the company’s most advanced offering to date.As a result, DeepSeek-V4-Pro is currently as cheap as US$0.0036 per million input tokens, a fraction of the cost of its American rivals. In comparison, OpenAI’s GPT-5.5 charges US$0.5 per million cached input tokens. Given that a conversation consists of input and output, and that input is typically three times longer than output, the cost per conversation on GPT-5.5 is 32 times that of DeepSeek-V4.DeepSeek said the cuts were effective immediately and would be a permanent price adjustment. Photo: DigiTimesDeepSeek’s aggressive pricing strategy reflects heightened competition in China’s foundational model market, following recent releases from high-profile start-ups – including Kimi K2.6 and Zhipu GLM-5.1 – each of which raised prices on their latest flagship versions. DeepSeek V4 is one of the few models to break the trend by significantly lowering its prices, triggering speculation that the move might ignite further price competition in the market.