FOR CTOS
When to Self-Host: A Sober GPU-vs-API TCO Framework
The real break-even math on owning compute.
Owning your own GPUs feels cheaper. Do the math before you believe it. H100s rent from roughly a dollar and a half to seven dollars an hour depending on the provider. Buying runs tens of thousands of dollars per card, plus power, cooling, networking, and the ops team to keep it all alive.
The break-even
Self-hosting only pencils out at sustained, high utilization with predictable load. For spiky or low-volume inference, the API wins on total cost every time, because you are not paying for idle silicon at 3am.
Build a simple comparison. On one side, your monthly token volume times the API blended rate. On the other, amortized hardware plus power plus ops plus the cost of idle capacity. Most teams overestimate their utilization and underestimate their ops burden, which is why most teams should rent.
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