The original title is: "Token Cost Optimization: The Complete Guide to Building Cost-Efficient LLM Applications"

Short summary

A guide to token cost fundamentals for engineers building LLM applications, explaining how tokens work, how providers charge, and why small inefficiencies scale into major bills. Covers input vs output tokens, hidden costs from conversation history and retrieved documents, and the compounding effect of unnecessary overhead across millions of requests. Positions token optimization as a core engineering discipline alongside CPU and memory optimization.

• •Tokens—not GPUs—are often the largest recurring cost in production LLM applications
• •A 500-token overhead per request can waste 150M tokens monthly at 10K daily requests
• •Token optimization is about eliminating waste while preserving user experience quality

Generated with AI, which can make mistakes.