Unsubsidised token prices that people would actually pay for is a fantasy.

I've been contemplating that recently. You're of course correct that subsidized tokens won't be forever, but that might only be half the story, since there's two opposing forces in action:

1. Phasing out of subsidized tokens.

2. Token prices being brought down through scaling, better hardware, etc.

It's possible that these might balance each other out sufficiently that token customers won't notice any substantial increase in price.

> local models might

That was yesterday's "LLMs might". Time passes. Nothing stays the same. "Local models might" X Y or Z today has no influence on the limitations of tomorrow's local models except to remove them. Yesterday's LLMs are the exact same thing, except your computer is connected to their local model for you to use.

Disc drives used to be measured in megabytes—now in terabytes. Technically useful tend to get more optimized with time, not less.

Even if they are subsidized forever and local models do compete, its still better to have 100 people improving it rather than 1.