Why are Small Language Models gaining rapid traction in enterprise environments over frontier general-purpose models?

Frontier models are enormous, computationally prohibitive, and operate like black boxes trained on public web data. Enterprises require high predictability, data privacy, low latency, and economic viability. By distilling frontier intelligence into specialized small language models, enterprises can deploy solutions inside private sovereign clouds at a fraction of the inference cost while achieving higher domain accuracy and zero risk of corporate data leakage.