Term
Token
A token is the smallest unit a language model works with internally — usually a sub-word fragment, occasionally a single character.
Token — explained in more detail
Language models do not process text letter by letter, nor strictly word by word, but in tokens — small chunks that typically correspond to sub-word fragments. The exact split is decided by each model’s tokenizer. A rough rule of thumb: about four characters of English text equal one token. German tends to need more tokens per word due to compound nouns and inflection.
Practical relevance
Tokens are the central billing unit for API calls: input and output tokens are usually priced separately. They also drive context-window usage and response latency — longer inputs cost not only more money but also more time.
Distinction from similar terms
A token is not the same as a word: a long word like “Versionskontrollsystem” is typically split into several tokens. It is also not to be confused with authentication tokens (API keys and the like) — same word, entirely different concept.
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