The Real Target of AI Regulation Might Be Open Source LLMs

There's a new push for mandatory government pre approval before any frontier AI model can be released, framed entirely around cybersecurity. I don't buy it. This has far less to do with keeping anyone safe and far more to do with frontier AI companies quietly locking in their market position through regulatory capture.

Sure, pre release approvals would be inconvenient (nobody loves more paperwork)... but that's not really the point. The real target, I suspect, is open source LLMs. They're increasingly capable, mostly free, and open weight. They're also decentralized, which means they simply can't comply with rigid standardization structures.

Remove open source models from the equation and you remove the very costly need to keep innovating and competing on compute costs. The numbers make that motive obvious... open source models like GLM 5.3 run about 5x cheaper than Fable 5, and DeepSeek v4 Flash comes in around 100x cheaper. Self hosted models carry zero per token fees. Take away that pressure, and frontier companies can set (and raise) prices however they like.

To be clear, cybersecurity and AI regulation are genuinely necessary... that's not the argument here. The argument is that regulation is being used to entrench power, not protect anyone. If your product is truly competitive and solves real problems, you shouldn't need the government to clear the field for you.

My takeaway is simple... competition keeps prices honest and innovation moving, and open source is a big part of that right now. I'd rather see companies win on merit than on who reaches the regulators first.