alt Hacker NewsWe are slowly inching closer to the point where AI and AI products will be billed for what they cost. We are currently living in the heavily discounted world where everything subsidized to the point where a lot of it is free. It seems like they can't or won't keep that up anymore. My prediction is that whenever one of the big companies raise their prices or move features to higher tiers others will follow soon. They all feel the pressure and non of them want to give away more money than they need to.
I wonder if managers will be as excited about AI when the prices go up.
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It is already bafflingly expensive. I interviewed at a place recently where they said the average dev was hitting $2k/mo in Claude code costs.
That is no longer a helpful tool... it costs like ~15% of an actual dev.
Even if it is helping, is it actually... making things better or building anything truly important? The issue seems way too nuanced to spend $2k/mo. Not to mention the entire tech industry floats on hype and imaginary goal posts so now what? Devs can hurdle towards those faster and more mindlessly?
Slowly inching? GitHub Copilot announced 600%+ price increases for many workflows, with others being potentially 100x more expensive due to the change from request to token based billing.
It's humorous to me that I can do the work of an AI with nothing but a coffee and an occasional sandwich and yet they talk about AI as if it's some sort of magic hack to productivity.
What they don't like is paying money for the work, that's all that matters to them.
This is already happening. For new Anthropic enterprise accounts you are billed at api token prices (maybe with a small volume discount). Anthropic makes a profit on those tokens. (Sure, that profit does not cover the model training costs, but that’s a separate issue.) It’s the subscriptions for individuals (e.g. Claude Max) that are still subsidized below cost.
> I wonder if managers will be as excited about AI when the prices go up.
Companies are willing to pay the api pricing. Engineering time is very expensive and AI coding agents actually work now since December and are actually showing measurable productivity gains, finally. It’s a good deal to make (obviously, with caveats: you need to make sure your tokens are going on productive tasks that will actually grow revenue) and anyone who penny-pinches is making a strategic mistake.