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Google Jacked Up AI Prices, Anthropic Jacked Up AI Prices, And OpenAI Is Going Bankrupt

Google has finished their IO keynote. And this year’s event is probably the biggest one in a while.

Last year’s Google IO showed off a bunch of features that were interesting tech demos but no one would really use. This year there are more features that I could actually see myself using. Things like Ask Maps and YouTube. Finally, YouTube is getting decent search capabilities. Although it looks like Ask YouTube is coming to only YouTube Premium users first.

This is actually a theme of Google I/O. Many of the features were either paid, heavily restricted to free users, or more expensive. Take Antigravity 2.0, their vibe coding tool. I have actually hit a limit when using the Antigravity IDE (which is a little different from Antigravity 2.0, but it’s related). And it looks like I have to wait a week to use it again.

Although it could be a bug. What I do know is that apparently Google has had to triple their usage limits — twice.

There’s also Gemini 3.5 Flash. Google says it’s faster than other models, but I’ve played around with it in AI Studio and it doesn’t appear any faster. Also it is 3 times as expensive as Gemini 3.0 Flash.

When a new Gemini model comes out, I always discuss how the new Gemini model is more expensive than the previous one, but it seems like this year other people are also noticing. There are discussions about how expensive 3.5 Flash is. Although it is still technically cheaper than Claude Sonnet and GPT 5.5.

Also, I should note that the knowledge cutoff for Gemini 3.5 Flash is still January 2025.

This has not changed since Gemini 2.5. So if you ask it who is the Prime Minister of Canada without tools, it will answer Justin Trudeau. Oddly enough it now knows that Trump is president. So I guess that’s one thing they improved over 3.0.

Update: I’m asking other models who is the current PM of Canada and President of the US and they all fail. Claude, DeepSeek, StepFun, Kimi, Nemotron, and Minimax. Oddly enough GPT 5.5 is the only model that knows both the current PM of Canada and the President of the US.

Well, regardless, I’m pretty disappointed by the performance of Gemini 3.5.

Then there’s Gemini Omni which I discussed here. It’s only available to people on a paid Google AI plan (Plus, Pro, and Ultra). This is a big change from the previous model, Veo, which was free.

Google also announced Information Agents which appear to be some sort of AI agents which run in the background. So they can notify you of new deals or product announcements. This feature is limited to Pro and Ultra users.

Also available to Pro and Ultra users is Google Pics which is some sort of Canva-like tool. It appears that Google is serious about this too as it’s also available to Google business users. So, who knows, it might take off. Or it might end up in the Google Graveyard.

Then finally there are two tools available only to the Ultra plan. Yes, you need to pay $100 a month to use them. They are Project Genie, which is used to create custom virtual worlds, and Gemini Spark, which is their OpenClaw-like tool.

Now I’m not sure if this pricing is permanent. For many of these tools, especially Spark and Genie, I expect them to be available to more users in the future. But it also wouldn’t surprise me if most of these features were permanently paid.

AI is really expensive. And recently we have seen companies start to charge more and more. For example Anthropic. Recently it was unveiled that they are moving to API pricing for the Claude Agent SDK. This will affect virtually all third party apps using Claude such as OpenClaw, Zed, Cursor, and Windsurf.

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It appears as though Anthropic is finally charging what it actually costs to run their LLMs and customers aren’t so happy. Microsoft actually dropped Claude Code and Uber said something similar. Token maxing is all fine and good when you don’t have to pay for the tokens.

So why now? Because Anthropic wants to IPO soon. And when you IPO you have to open the kimono and show everyone your financials. If you’re burning billions every year like SpaceX it’s not a good look. So they’re getting their house in order and focusing heavily on profitability.

And it looks like it’s paying off, people are reporting that Anthropic is about to have their first profitable quarter. Although some other people are not convinced. We’ll see who’s right when Anthropic files to go public.

I suspect Anthropic raising prices made Google think they could also raise prices. Although they haven’t forced people to use API pricing yet — thank god.

Although this begs the question: what about OpenAI? Well, the Wall Street Journal recently wrote an article about how they missed projections. I wrote about it here.

In that post I noted how OpenAI had a plan to be profitable by 2029. And then they changed it to 2030. And now it looks like they changed it again to 2033. And if this WSJ report is true it looks like they might not ever be profitable. I think at this point everyone knows that OpenAI is going to go bankrupt. And as a result no one considers them a serious competitor. Especially as they appear to be scaling back operations such as with Sora.

It looks like the golden age of highly subsidized AI is over. Although maybe not completely over. With a $20/month AI Pro plan you can get most of the features that Google announced at IO. And it’s likely the ones you don’t will eventually be available on the Pro plan later.

But will it stay that way? After all, Anthropic already started introducing API pricing for their tools. Could that happen to Google as well? Could we see the number of tokens in your plan slowly ticking down?

Interestingly, the Gemini App actually moved away from a flat rate and towards compute-based limits. So it’s not impossible. Maybe Google is slowly boiling the frog just like Gemini API prices which kept getting more expensive with every release.

Maybe one day we will all have Google AI Pro subscriptions and not know how we got into this situation. I mean, we already have a lot of subscriptions. What’s one more?

Although I do hope it will stop at only $20/month.