OpenAI announced on Thursday that it is slashing prices on two of its three GPT-5.6 series models, cutting Terra by 20% and Luna by 80%, roughly three weeks after their public release1.
Terra, the mid-tier model in the GPT-5.6 lineup, will now cost $2 per million input tokens and $12 per million output tokens. Luna, the fastest offering in the series, will drop to 20 cents per million input tokens and $1.20 per million output tokens. Pricing for Sol, the most powerful model in the GPT-5.6 series, remains unchanged.
OpenAI CEO Sam Altman characterized the reductions as "major" price cuts2. The company said its strategy remains focused on advancing both capability and efficiency so that each generation of intelligence can accomplish more work at a lower cost.
The cuts come as OpenAI faces pressure from a more cost-sensitive enterprise customer base, where companies have been less inclined to deploy expensive models without a clear picture of return on investment. The company is also contending with intensifying competition from Chinese startups, Google, and Microsoft.
Several competitive moves preceded the price reductions. Moonshot AI released an open-weight model called Kimi K3 earlier this month, which outperforms some cutting-edge American offerings across certain industry benchmarks. Google debuted three new models this month aimed at undercutting competitors on cost, with the company saying Gemini 3.6 Flash is cheaper per task than Kimi K3 and other Chinese models. Anthropic released Claude Opus 5, which it described as its best-performing and most cost-effective offering for many use cases, performing comparably to Claude Fable 5 across coding and knowledge work tasks at half the price. Microsoft CEO Satya Nadella highlighted his company's cost-effective models during its quarterly earnings call with investors on Wednesday.
ANALYSIS The Luna price cut is particularly aggressive — an 80% reduction just three weeks after launch signals that OpenAI views the low end of the model market as a critical competitive battleground. The decision to hold Sol's pricing steady while cutting Terra and Luna suggests OpenAI is segmenting its strategy: maintaining premium pricing on its most capable model while competing on cost at the mid and lower tiers. The speed of these reductions — weeks rather than months after launch — reflects the pace at which pricing dynamics are shifting across the frontier model market, with multiple providers moving simultaneously to position on cost.