Executive Summary: The Rise of Specialized Small Language Models
← Series Hub | Next Chapter: Part 1: Hybrid AI Architecture → Prerequisite: Read the Series Hub for the overarching architectural curriculum and hardware requirements. Answer-first: Self-hosting specialized Small Language Models (1B–14B) on private vLLM infrastructure breaks even with cloud APIs at 8.5 million tokens daily. Beyond this threshold, self-hosted inference slashes operational expenditure by 95% to 98% and cuts P99 Time-to-First-Token latency from 1,850ms to sub-40ms while enforcing full data privacy under GDPR and HIPAA regulations. ...