Good morning. Yesterday I mentioned companies’ growing concern over the sometimes shocking cost of using AI. For market leaders like OpenAI and Anthropic, which face even more mind-blowing expenses, that could be a problem.

Last night we got word that OpenAI and Anthropic want to get ahead of it.

OpenAI is considering drastically lowering the prices it charges users as business leaders begin to balk at high costs, Keach Hagey and Berber Jin report exclusively for The Wall Street Journal.

The move would be in anticipation of similar cuts the company expects at Anthropic, according to people familiar with the matter.

A price war would be an early test of the strength of both companies’ business models ahead of hotly anticipated public listings. OpenAI and Anthropic have captured the majority of revenue from new AI products, powering their rise.

But an underlying risk that investors have long identified is the interchangeability of their products, and the ease with which customers can abandon one for the other.

Related: Charging users for subscriptions is only Meta Platforms’ latest bid to build a business outside advertising, but its planned capital spending on AI is making the project more urgent than ever. [WSJ] 

AI token costs loomed over the conversations about AI at Day 2 of the WSJ CEO Council Summit in London.

You’ll remember Uber’s disclosure that the company had blown through its AI budget for 2026 just months into this year.

“Same at WPP,” said Cindy Rose, CEO of the ad holding company, on stage at the CEO summit.

Token prices have actually fallen for some uses, Rose noted—just not typically for hers.

“The deflation tends to apply to commodity cognition,” Rose said. “In the marketing space we’re using the very expensive models, right? Because we’re doing frontier reasoning, we’re doing high-resolution video and audio, where there’s no deflation, just cost increase. So, you know, I think this is, this is the problem or the sticker shock that most companies haven’t yet experienced but will.”

Rose didn’t suggest any kind of imminent pullback from AI spending.

“We’ve got 15,000 creative executives at WPP and they are by far the biggest users of AI in our organization,” she said. “And my mantra to them is always ‘Use AI to automate the ordinary and elevate the extraordinary,’ because when you free humans up to do what only humans can do, extraordinary things happen.”

But WPP will get more sophisticated about AI use, Rose said.

“I’ve got more agents than employees now,” she said. “And there’s a lot of unbudgeted costs associated with that. So now the pivot needs to be towards token consumption optimization, which is the next chapter.”

Video: See the entire conversation on AI investment and impact with WPP CEO Cindy Rose, Deliveroo CEO Miki Kuusi and Yum China CEO Joey Wat.

More from the WSJ CEO Council Summit: What A$AP Rocky taught Burberry’s CEO about brand building. [WSJ Video]

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