For those asking / pronouncing this has to be satire, perhaps. But not for long. AI is still not making a profit. So whatever it costs today at the growth-at-all-costs subsidized rate, think how much more expensive it will be when investors start insisting on profit after market consolidation*.
Because if you think there is a competitive barrier to entry for smartphones, operating systems, CPUs, and streaming services, you ain’t seen NOTHING yet
A Claude Max subscription is $200 a month, which is roughly $7 a day. I’m forced to use Claude Code at work, and I frequently run the /usage command out of morbid curiosity to see how many tokens in wasting. I’m not exactly a power user, but even with my bare-minimum usage I typically burn about $50 of tokens per day — so roughly 7 times that $7 a day figure.
And that’s just based on Anthropic’s official per-token pricing, which itself is almost certainly subsidized… so it’s likely I’m costing them something closer to $20-$30 for every $1 of revenue. And again, I’m only using it for the bare minimum. I know people with much higher usage than me.
Similar boat, lots of people on the loss-leading phase, ‘the first hit is free/cheap’ is in play and I know development organizations that are explicitly designing hard dependencies on hosted AI as the ‘foundation’ of their processes. They are going for mainframe-style lockin where customers are too scared to change when it gets too expensive.
I know one organization that at least is being more careful, their LLM usage is only based on whatever they can run indefinitely on-premise without sweating future traps around pricing changes.
Yeah. I would prefer to work at an organization that uses no AI at all, but at the very least companies should be moving to on-prem local models so that they don’t suddenly get rug-pulled the moment the investment cash runs out and AI firms are forced to raise prices or die.
I’ve been yelling this at my own org for months, but no one cares.
Move fast and break things, even if the thing you’re breaking is your own fucking business…
For those asking / pronouncing this has to be satire, perhaps. But not for long. AI is still not making a profit. So whatever it costs today at the growth-at-all-costs subsidized rate, think how much more expensive it will be when investors start insisting on profit after market consolidation*.
Because if you think there is a competitive barrier to entry for smartphones, operating systems, CPUs, and streaming services, you ain’t seen NOTHING yet
They’re spending $3 per $1 of revenue. The price per token will rise dramatically.
I suspect it’s even worse than that.
A Claude Max subscription is $200 a month, which is roughly $7 a day. I’m forced to use Claude Code at work, and I frequently run the /usage command out of morbid curiosity to see how many tokens in wasting. I’m not exactly a power user, but even with my bare-minimum usage I typically burn about $50 of tokens per day — so roughly 7 times that $7 a day figure.
And that’s just based on Anthropic’s official per-token pricing, which itself is almost certainly subsidized… so it’s likely I’m costing them something closer to $20-$30 for every $1 of revenue. And again, I’m only using it for the bare minimum. I know people with much higher usage than me.
Similar boat, lots of people on the loss-leading phase, ‘the first hit is free/cheap’ is in play and I know development organizations that are explicitly designing hard dependencies on hosted AI as the ‘foundation’ of their processes. They are going for mainframe-style lockin where customers are too scared to change when it gets too expensive.
I know one organization that at least is being more careful, their LLM usage is only based on whatever they can run indefinitely on-premise without sweating future traps around pricing changes.
Yeah. I would prefer to work at an organization that uses no AI at all, but at the very least companies should be moving to on-prem local models so that they don’t suddenly get rug-pulled the moment the investment cash runs out and AI firms are forced to raise prices or die.
I’ve been yelling this at my own org for months, but no one cares.
Move fast and break things, even if the thing you’re breaking is your own fucking business…
We also have that energy shortage problem right now.