Writing / Tag / 7 of 67
Cost Optimization
Every essay tagged Cost Optimization, newest first.
Cost optimization here is the deliberate side of the cost story: the techniques, in roughly the order I would apply them. Route each request to the cheapest model that can handle it. Match reasoning effort to query difficulty instead of paying for thinking that easy queries never use. Cache the answers you have already given. Offload the 40,000-token tool result that the agent needed twelve tokens of. Cap each tenant before the call, not after the bill.
None of this trades away quality if you do it with an eval gate in place, which is why the cost guide and the evals essays lean on each other. The cheap path is only cheap if you can prove it still works.
Read model routing first; it is the biggest lever for most teams and the easiest to measure. Then reasoning effort budgeting, which matters more every month as thinking models become the default, and semantic caching for the questions your agent has already answered fifty times today.
September 2026
Your Easy Queries Are Paying for Thinking They Never Use
You turned on extended thinking because it lifted your quality numbers, and a quarter later the invoice had doubled.One Flaky Step Is Sinking Your Agent. Vote It Out.
You measured your agent and found one step that flips between right and wrong on the same input.
August 2026
Your Model Started Showing Its Work. Now You Have to Handle It.
Reasoning traces are the feature everyone turned on this month and nobody planned for.One Customer Burned Your Month of LLM Budget by 2pm
LLM spend is per request and wildly variable, so a single runaway agent or one heavy tenant can externalize its cost straight onto your margin.Your Tool Returned 40,000 Tokens. The Agent Needed 12.
A single tool call can dump a whole file, a full API response, or a thousand log lines straight into the context window.