LLM Distillation 2026: Shrink Qwen3 with Axolotl & DPO
Learn LLM distillation in 2026: shrink Qwen3 into fast, cheap production models using Axolotl and DPO, with real cost math and training steps.
Chapter 1: Why Distillation Won 2026: The Economics of Shipping Small Models Two years ago, the default architecture for any AI feature was a POST request to someone else's API. You picked a frontier model, wrote a prompt, and shipped. The model was smarter than anything you could train, the pricing looked cheap on a spreadsheet, and nobody wanted to own GPUs. That era is over — not because frontier models got worse, but because the economics underneath them stopped making sense for the workloads most teams actually run. The shift is simple: production AI is dominated by narrow, repetitive...