Evaluate · Cost
Hosted vs self-hosted cost comparison
Short answer: self-hosting is cheaper only when the hosted spend you avoid exceeds local running costs by enough to repay the hardware within its life — and only if the local model passes the same quality bar. Enter your own volumes and prices below. Everything is calculated in your browser.
Estimated Based only on the inputs you entered.
Cash flow
Year 0 is the hardware purchase. Hardware is re-purchased at the end of its useful life.
| Year | Hosted | Local | Cumulative hosted | Cumulative local |
|---|
Local running costs per year
Sensitivity
What this does not include
Quality parity between the hosted and local models, implementation and integration work, rack space or cooling, financing costs, and resale value. A local model that fails your acceptance tests makes any saving irrelevant.
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Frequently Asked Questions
When does self-hosting an LLM become cheaper than an API?
When the monthly hosted spend you would avoid is larger than the monthly cost of running local hardware (power, admin time, support, and any traffic still sent to an API), by enough to repay the hardware within its useful life. At low or bursty volumes, or with inexpensive small hosted models, that point may never arrive; this calculator says so rather than forcing a break-even.
Does this account for quality differences between models?
No. It assumes the local model meets the same acceptance criteria as the hosted one. If it does not, the comparison is invalid. Quality has to be tested on your own examples, which is what a fit assessment does before any cost conclusion is drawn.
Why are cash flow and annualised cost shown separately?
Cash flow shows when money actually leaves the business: a large purchase up front, then running costs. Annualised cost spreads the hardware over its useful life so you can compare a steady-state yearly figure with a hosted bill. Both matter, for different decisions.
Are the default API prices current?
No. They are examples only. Replace them with the current list price, or your negotiated price, for the model you actually use.