Sume Launches Zero Markup API Today, Users Access Same Models at Original Provider Prices
Sume launched a zero markup API today, allowing users to access the same models at original provider prices. Founder David Im pointed out that markup at the routing layer in the AI video industry is no longer sustainable.
For example, with Seedance 2.0 480p, Runway has a markup of 414%, fal has a markup of 100%, and the Higgsfield API still has a 40% markup after maximum discounts, with requests only forwarded to ByteDance before returning videos.
Higgsfield achieved an annualized revenue of over $1 billion in September, while Runway reached $200 million ARR during the same period, and OpenArt is close to $200 million. However, all platforms offer the same models, and interfaces are converging to prompt boxes, model dropdowns, and template libraries.
Sume plans to offer all Higgsfield features at original prices in the first phase, launching one feature each week, and in the second phase, it will introduce a complete advertising workflow product covering trend discovery, storyboarding, production, publishing, and optimization, having completed six months of internal enterprise testing.
Customers migrating from Higgsfield to Sume experience almost no friction, with switching costs close to zero, making competition shift from product differentiation to marketing budgets.
The lack of a moat at the routing layer will lead to commoditization, with price competition continuing to push down to costs, and early routing providers' markup space being eroded by new entrants.
Funds are flowing from high markup routing platforms to original price providers and workflow tools, putting pressure on companies like Higgsfield that rely on routing profits, while application layers that have customer context and organizational embedding benefit.
Source: Public Information
ABAB AI Insight
Higgsfield was founded by former Snap executives and increased its annualized revenue from about $1 million to over $1 billion within 18 months after its launch in March 2025, completing a $400 million Series B round and achieving a valuation of $5.4 billion, primarily serving direct-to-consumer advertising production needs. Runway and OpenArt also achieved hundreds of millions in ARR during the same period but did not develop their core video models in-house.
In terms of capital strategy, Sume is opening the routing layer with zero markup, actively giving up profits at this layer and shifting towards a complete advertising production workflow with brand specifications, historical campaigns, and performance data. Internal testing has shown that teams are restructuring roles due to the new workflow, embedding products into organizational structures to create switching costs.
Similar cases can be seen in the early commoditization of the IaaS layer in cloud computing, where value migrated to upstream SaaS and workflows, or e-commerce platforms shifting from traffic distribution to proprietary brands and services. The current AI video sector is in a phase of rapid commoditization at the routing layer, with application layers competing for workflow lock-in.
This essentially represents a transfer of pricing power driven by technological substitution: the models themselves are controlled by providers like ByteDance, and routing markups depend on information asymmetry. Once zero markup options emerge, profits concentrate from the middle layer to application layers that possess customer context and ongoing usage scenarios.
ABAB News · Cognitive Laws
Profits without a moat will eventually be driven to zero by competition.
When switching costs are zero, products are merely advertisements.
Workflow lock-in is harder to replace than model dropdowns.