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Test-time compute made models smarter by paying for the same cognition over and over. That axis is hitting diminishing returns, and the frontier labs are moving reasoning into training. For agent operators, the runtime bill is about to change shape.
LLM 0.32 streams frontier models' reasoning traces straight to your terminal. That turns a black box into something you can watch, debug, and stop trusting on faith.
DeepSeek proved reasoning is teachable to small models with plain fine-tuning on worked traces. For agent builders, that collapses the reasoning-model premium and resets what counts as capability.
Microsoft's MAI-Code-1-Flash and MAI-Thinking-1 ship with active parameter counts as low as 5B. The number that matters isn't the headline trillion. It's the runtime ecosystem quietly converging on lean, purpose-built execution.
