At my org we've been building AI agents and one internal rule we have is to use at most 50% of the models context window with the recommendation to not go over 25% for large context window models.
Anytime I see a "1M Context Window", my brain always goes "Gotcha so a 250k usable window"
Why 25% and not 12% or 40%? Is this an arbitrary vibestimate or you had some tests done that pointed you to 25%? I am genuinely interested in how others deal with context issues. Also I would think the usable context window is variable depending on the task, for example summarizing documents vs analyzing large, scattered and complex instructions.
Every single analysis I've seen done by anyone has basically come to the same conclusion: assuming sane BF16 or Q8 model quant, and BF16 or Q8 KV context quant (ie, not intentionally screwing over the model), you get about 250k before it pukes.