AI Costs Are Surging and the Cheap Model Fix Might Not Last

**Nathaniel Whittemore** (0:00)
Today on the AI Daily Brief, how does AI change if access to open weight models starts to get cut off?
Before that in the headlines, all the new models you have access to right now and all the ones that are coming. The AI Daily Brief is a daily podcast and video about the most important news and discussions in AI.
All right, friends, quick announcements before we dive in. First of all, thank you to today's sponsors, KPMG, Blitzi, Airtable, and Retool. To get an ad-free version of the show, go to patreon.com/aidailybrief. And of course, if you want to learn more about sponsoring the show, send us a note at sponsors at aidailybrief.ai.
And my friends, if you thought that this was going to be a slow summer, think again. We are just absolutely drowning in model announcements or announcements of announcements in some cases today. So let's get into everything that is here and everything that is coming.
Now, the first one is not a surprise, as this was announced during the period that Fable was offline, but the Gpt 5.6 family of models, including Sol, Terra, and Luna, OpenAI announced in the middle of the night for some reason that they would be officially coming on Thursday. And in addition to that announcement of the announcement, they also unlocked early testers to begin sharing their impressions. We're going to go much deeper into this when the model actually comes out, but a lot of those first impressions are pretty positive. Ali K. Miller calls the model an execution beast. So much, she says, that I think 5.6 is the absolute wrong name considering how big of a leap this felt to me. Her conclusion, When Sonnet 3.7 came out, I think we no longer tolerated bad writing. Having Gpt 5.6 and Fable 5 out in the world, I think we will no longer tolerate bad execution or slow bug fixes or unhelpful customer support. Or at least tolerate a whole lot less.
Magic Path CEO Pietro Schirano wrote, I can finally talk about 5.6. I've been testing it for months and without exaggeration, it's the best model I've ever used. Fast, smart, genuinely creative, and you guessed it, they finally fixed front-end design. I haven't needed to check the code I've written in two months. YouTuber and AI entrepreneur Theo wrote, It's a damn good model. Not quite as quote-unquote smart as Fable, but it's incredibly capable. Fixed all the problems I had with Gpt 5.5. It's incredibly determined, will run for a day without even using a slash goal. It understands subagents incredibly well and is great at orchestrating. It's super pleasant in use cases like OpenClaw and Hermes Agent. It knows iOS dev incredibly well. It has rough edges too, but far fewer than 5.5 did. For many things, Gpt 5.6 sole will become my obvious default. Now, of course, the question that many will have is how does it compare to Fable? And not everyone was convinced that 5.6 beats it. Matt Schumer writes, 5.6 sole is an amazing model, but for almost every task I tested, Fable was quite a bit better and more agentic to boot. I.e. one Fable turn does the same things many 5.6 turns do.
Interestingly, however, according to Ethan Mollick, that mode of interaction, where Fable goes off and does more things on its own, and 5.6 sole sticks closer to the user might be more intentional than it at first seems. Ethan wrote, 5.6 sole is of similar ability but quite different feel than Fable. Fable wants to go off and do work on its own pace. Sole is faster but works with you and steps more. Now, for Ethan, this wasn't an either or. He continued, I found myself switching between Fable and sole depending on task. Sole for back and forth tasks, especially when I had not yet figured out what I needed exactly, Fable for very long tasks where I could define what I wanted, and Sole Pro for really hard problems. Still for some, the biggest and most interesting hint from this commentary was around just how long some folks said that they had been testing this. Remember, Pietro Shirano wrote, I've been testing it for months. Chubby Kimminismus writes, Wait, he had already been testing 5.6 for months? That means 5.6 had already finished training when Mythos and Fable 5 had their reveal. And of course, the implication is that these are not the most state-of-the-art models that these labs have access to.
Now, while any new state-of-the-art model captures more attention than anything else, it is increasingly the case that people are thinking not just about raw model performance but also model efficiency. And you can feel increasingly people getting excited not just about the frontier model releases but models which offer something discrete and specific as part of an overall robust and complex model architecture. And that is potentially where SpaceX and Cursor's new model comes in. Yesterday afternoon, the information reported that the model release was imminent and could be coming as soon as Wednesday. The memo stated the release was pushed back from earlier this week to allow for efficiency tweaks. Now, when it comes to this particular model, we have had a few breadcrumbs over recent months. Last month, for example, Cursor CEO Michael Trull announced that they had finished pre-training their first model from scratch using SpaceX AI infrastructure. He said the model had 1.5 trillion parameters and also hinted that the model would be intelligent beyond coding, suggesting that this could end up a more general purpose model as opposed to the Composer series, which has been very specifically designed for coding tasks. Elon Musk has also hinted at multiple large training runs taking place at Colossus 2, and a little over a week ago said that Grok 4.5 had entered private beta at SpaceX and Tesla late last month. Grok 4.5, he said, is based on what he called their 1.5 trillion parameter V9 foundation models, with cursor data added in post-training. At the end of June, Musk wrote, early evals show performance close to perhaps exceeding Opus. And that was reinforced when late last night, Elon Musk confirmed the rumors and said that yes, indeed, Grok 4.5 would be coming today. In fact, by the time that you are listening to this, it is highly likely that Grok 4.5 is out. Elon tweeted, based on strong positive feedback from customers in our beta test program, SpaceX AI will make Grok 4.5 available to the public tomorrow. It is an open class model, he wrote, but faster, more token efficient and lower cost.