
LLM Costs Soaring? Semantic Caching Slashes Bills 73%
Semantic caching, which focuses on the meaning of queries rather than exact wording, can drastically reduce LLM API costs by identifying and reusing responses to semantically similar questions. By implementing semantic caching, one company achieved a 67% cache hit rate, leading to a 73% reduction in LLM API expenses, highlighting the potential for significant cost savings and improved efficiency in LLM applications. This approach addresses the limitations of traditional exact-match caching, which fails to capture the redundancy inherent in user queries phrased in diverse ways.

















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