Researchers build OpenAI rival for under $50, raising questions about AI’s future

Thora Flatley
▶
February 8, 2025

Why it matters: A team from Stanford and the University of Washington trained a reasoning model, s1, for just $50 in cloud credits. The model rivals OpenAI’s o1 and DeepSeek’s R1, showing that cutting-edge AI may no longer require massive budgets.

‍The big picture:

  • How they did it: Researchers fine-tuned an off-the-shelf model using a process called distillation, training it on answers from Google’s Gemini 2.0 Flash Thinking Experimental model.
  • The cost: Training s1 took just 30 minutes on 16 Nvidia H100 GPUs, with compute costs estimated at $20–$50.
  • Performance: s1 matches top reasoning models in math and coding benchmarks, despite being trained on a dataset of only 1,000 curated questions.

Between the lines:

  • Open-source shift: s1’s code and data are available on GitHub, making it accessible to anyone.
  • Industry disruption: If high-performing AI models can be replicated cheaply, it challenges the dominance of big labs like OpenAI, which spend millions on training.
Get vetted and top proven ChatGPT prompts to automate most areas of your work.
Download it for future reference.

The controversy:

  • Data ethics: OpenAI has accused competitors like DeepSeek of improperly using its API data for distillation. Google’s terms also forbid reverse-engineering its models, raising questions about s1’s legality.
  • Limitations: While distillation is cost-effective, it doesn’t create groundbreaking new models — it simply replicates existing ones.

What’s next:As AI giants like Meta, Google, and Microsoft pour billions into next-gen models, s1’s success highlights the growing accessibility of AI innovation. But legal battles over data use and intellectual property could shape the future of open AI development.

Become smarter in just 5 minutes
Lettter serve up the most interesting stories in tech, science, world affairs, business, and more—all in 5 minutes or less.
Booyah! The first newsletter will go out early next week.
Oops! Something went wrong while submitting the form.
Read Today's Edition
Your 5-minute daily brief that replaces 10 newsletters

We scour 100+ sources daily, delivering fact-driven insights for the intellectually curious.

50,732 readers today.
Booyah! The first newsletter will go out early next week.
Oops! Something went wrong while submitting the form.
Continue read the article
We cover everything.

AI, tech,  business, culture, science, sports, and internet things

50,732+ subscribers and growing daily

Busy folks who want clear, unbiased news and skimmable news.

ChatGPT cheatsheets

ChatGPT cheatsheets with Bonus ChatGPT tips & tricks inside.

ChatGPT 10,000 prompts playbook

Vetted and top proven prompts to automate most areas of your work.

"I love how stories are skim-ready. It’s perfect for my busy schedule! I can quickly catch up on what’s happening without spending hours scrolling."

Tom R.

"Finally, a news source that values my time! I get all the facts without the fluff."

Sarah L.

"For the first time, I enjoy reading the news again. Thank you for restoring my faith!"

Jennifer S.

"No more doomscrolling! I’m informed and engaged with real news."

Mike P.

"As someone who's always busy, this service has transformed how I consume news. I can grasp complex topics in just minutes!"

Emily R., Entrepreneur

"This is my go-to source for news. It feels like a breath of fresh air in the media landscape!"

Rajesh D.

"I love the design of the website and email newsletters! They're visually appealing and much more user-friendly than most other newsletters, which often focus only on desktop viewing."

Aisha M.

"I appreciate the diversity of topics covered—it's like having a personal news curator! I’m learning about things I never would have explored on my own."

Alex M.