Google launches affordable AI model
Google has introduced a lower-cost version of its Gemini AI series called Flash-Lite. The move comes as investors become increasingly concerned about the costs associated with developing and using artificial intelligence.
The company already offered a lightweight version called Gemini Flash, but Flash-Lite takes affordability to the next level and poses a direct challenge to cost-effective AI models from competitors such as DeepSeek. In addition to Flash-Lite, Google also made Gemini 2.0 Flash available for public use after a preview period for developers in December and released a new version of the top-of-the-line ‘Pro’ model for testing purposes.
The financial implications of AI development have become a focus for investors. The disclosure by Chinese competitor DeepSeek that it spent less than $6 million on training a model, which is significantly lower than industry estimates for large US companies, has heightened these concerns. Investor concerns about capital investment in AI led to a drop in Alphabet’s share price after the announcement that its planned 29% increase in spending exceeded expectations.
Costs for using AI models vary and are charged through Google Workspace accounts, but prices are currently still expressed in dollars.
In the rapidly evolving AI landscape, Google’s new Gemini models are intended to make AI more accessible and financially manageable. Competitors such as DeepSeek and OpenAI continue to influence pricing strategies within this dynamic market. However, increasing investor concern about AI development costs could have a significant impact on future financial decisions across the industry.
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