Closed AI models dominate the price-performance frontier

Closed AI models from companies like OpenAI, Anthropic, and Google now dominate the price-performance frontier, with open-weight models holding only 3% of budget categories compared to 41% in June. Closed labs maintain this advantage through the ability to distill cheaper versions from their own flagship models, releasing complete product families across price points, and benefiting from massive-scale inference infrastructure. Open models achieve value leadership only in brief bursts after strong releases before closed competitors undercut them with cheaper, stronger alternatives.