IBM CEO Speaks Out on Earnings Call: Open-Weight Models Deliver 90% of the Capability at 10% of the Price, and the Paid Frontier API Logic Is Unraveling
IBM CEO Arvind Krishna said on the company’s Q3 earnings call that open-weight models now deliver about 90% of frontier model effectiveness at 10%–25% of inference cost, reshaping enterprise AI procurement. The claim also aligns with IBM’s hardware, on-premises software, and Red Hat businesses, while the remaining capability gap and local operations talent requirements still matter.