Self-hosting means operating the inference software, model weights and hardware environment yourself, whether on machines you own or compute instances you rent. It usually requires a downloadable model and permission under its license to run it for your intended purpose.

The main attractions are control over deployment, data location, software versions and the way requests are processed. For predictable high-volume demand, keeping a GPU busy can sometimes cost less than paying an external API for every token.

The trade-offs include setup work, memory capacity, GPU availability, power or rental costs, upgrades, safety controls, monitoring and failure recovery. A lightly used GPU can be poor value, while an API may scale up and down more conveniently. Self-hosting also does not make a model inherently secure or accurate.

Compare the full cost per successfully completed task, including staffing and downtime, not just the hourly server bill. Test model quality, latency and licenses before migrating important workloads.