Key insights
- Microsoft and Anthropic are shifting AI services from fixed subscriptions to usage-based billing (token/model credits). This change could increase costs for some users, potentially boosting revenues for Big AI providers if demand remains strong. However, it might also incentivize self-hosting of models like Llama for cost-conscious companies, creating a mixed outlook for the AI sector's future growth and adoption.
- Microsoft has announced that they are ending fixed monthly subscription for Github Copilot and switching to token and model based AI credits.
- Anthropic announced that they are ending fixed API subscriptions and will charge based on usage.
While fixed pricing is maintained for some use cases and providers, it seems like there is a shift towards usage base billing.
How do you think it will affect the demand and revenues for big AI?
Do you think it will drastically change how some companies approach AI or make self hosting models like Llama more popular?
In an anectodal case, the company announced with this change they are bringing 1000€/month limit to AI credits where previously it was 20€ fixed price. Surpassing this limit will be also allowed with special permission from the leadership. So I think it is bullish for Big AI, but I wonder what others experiencing or expect to experience on other companies.