The open-versus-closed debate often turns ideological. In practice it is an engineering decision: which constraints in your product are non-negotiable?
When closed wins
If you want the best reasoning available today, fast time to launch, and no ops team, hosted APIs remain the quickest and often genuinely cheapest start.
When open wins
With high steady volume, local data-residency requirements, or a need to fine-tune on your own terminology, self-hosted open models start to make financial and regulatory sense.
Cost is not the per-million-token price
Add hosting, monitoring, upgrades, and engineering time. Many teams discover that "free" costs one engineer salary per month.
Do not pick an architecture on principle; pick the one that survives your three hardest constraints.
Hybrid is the common answer
Most successful teams use a strong closed model for hard tasks and a small fast open model for classification, summarization, and high-frequency work.
Start closed to prove value, measure cost and volume monthly, then move parts of the workload to open once the numbers are clear.