Earlier quoted context omitted.
Humans are not cheaper than AI models. Let's go with $35 an hour. 24 365 = 8760 8760 $35 = $306,600 Yeah, a human working non stop will run $300k. Now you said, the "best" models. I personally reckon that 80-90% of most work don't need the best models. They need a good model, and good models are super cheap. i.e, the tiny gemma4 or qwen3.6 models will be sufficient for most of those work. AI cloud usage cost goes up…
> So say someone built an under $10k system, with perhaps dual RTX 5090. That same system will be able to easily run 20 parallel requests. The only cost is electricity. You can run it 24/7. For 1 year, that's ~$6million I dont see how you get anywhere close to $6M of tokens out of a pair of 5090s. The class of model they could run is fairly small and extremely cheap to run via API (my math says running Gemma4-31B for…
Are the costs of AI agents also rising exponentially? (2025)
121–130 of 155 posts
Re: Are the costs of AI agents also rising exponentially? (2025)
#122Earlier quoted context omitted.
If they had such a high margin, they wouldn't need to fuck around with token usage/pricing every three days. I have no data to support this, but I think they just about break even on API usage and take overall loss on subscriptions/free plans.
Math / Economics 101 thought experiment. You have (limited) 100 Coke cans to sell (that you bought for say $1) There are two large lines being formed for that. One line is offering an average $3 per bottle and another line is offering an average $2 per bottle. Tell me which line they would throttle/starve even though they make a profit out of it. Also, when the lines were formed you had no idea of the average price,…
Unfortunately, back in the real world, Anthropic is dealing with two issues:
1. They're throttling all lines. Their latest model uses more tokens overall. Tokens are being rationed and context is being lowered.
2. There's another line for Pepsi right over there. And it costs $1.25 per can.
Anthropic should be lowering their price to compete with OpenAI, but they're not. They're making it even more expensive.
So tell me, does that really look like Anthropic is running a (as some people say) >50% profit margin?
Re: Are the costs of AI agents also rising exponentially? (2025)
#123Earlier quoted context omitted.
Value feels pretty relative to me. If anyone can do a 'thing', is that thing worth less?
If you still need that thing done, the value is basically however you value your time. Would you pay extra for having someone or something do that for you instead?
Re: Are the costs of AI agents also rising exponentially? (2025)
#124What's rising exponentially is the price of the most ambitious thing cutting edge agents can do.
But to answer whether the cost of AI agents is rising in general, you would take a fixed set of problems, and for each of them, ask "once it's solvable, how does the price change?"
For that latter question, there isn't a lot of data in these charts because there aren't enough curves for models of the same family over time, but it does look like there are a number of points where newer models solve the same problems at lower prices. Look at GPT5 vs. the older GPT models--the curve for GPT5 is shifted left.
Re: Are the costs of AI agents also rising exponentially? (2025)
#125The crazy part about this is if you compare it not to US wages but european, for instance in the UK where the median software hourly wage is somewhere around $35-40 an hour, then humans are already cheaper than the best models.
Re: Are the costs of AI agents also rising exponentially? (2025)
#126This is an interesting analysis, but "are the costs of AI agents also rising exponentially is?" is a very bad question that this doesn't answer. What's rising exponentially is the price of the most ambitious thing cutting edge agents can do. But to answer whether the cost of AI agents is rising in general, you would take a fixed set of problems, and for each of them, ask "once it's solvable, how does the price change…
The author performs a non sequitur by muddling two concepts of time. They say costs are getting “unsustainable” which is not a conclusion that follows.
What is true is that at a given point in time, cost to perform a task is exponentially related to the human time taken. But it does not mean it will remain that way.. far from it.
Re: Are the costs of AI agents also rising exponentially? (2025)
#127- Smaller chunks make review much easier and more effective at finding bugs, as we've known since long before LLMs.
- Greater certainty provides a better development experience. I've heard people talk about how LLM development can be tiring. One way that happens, I think, is the win-or-lose drama of feeding in huge tasks with a substantial chance of failure. I think if you're succeeding 95% of the time instead of 70%, and the 5% are easier to deal with (smaller chunks to debug), it's a better experience.
- Everything is harder about real-world tasks because they aren't clean verifiable-reward benchmarks. Developers have context that models don't, so it's common that a problem traces to an detail not in the spec where the model guessed wrong. For real-world tasks "failures" are also sometimes "that UI is bad" or "that way of coding it is hard to maintain." And it's possible to have problems the dev simply doesn't notice. The benchmarks' fully computer-checkable outcomes are 'easy mode' compared to the real world.
- Fixing agents' mess becomes more work as task sizes increase. (Like the certainty thing, but about cost in hours than the experience.) Again, if the model has spat out 1000 lines and stumped itself debugging a failure, it'll take you some time to figure out: more time than debugging 250-line patch, and the larger patch is more likely to have bugs. And if an issue bug makes it out to peer review, you can add communication and context-switching cost (point out bug, fix, re-review) on top of that.
- Bugs that reach prod are really expensive. More of a problem when a prod bug can lose you customers vs., say, on most hobby things. Ord's post gestures at it: there are "cases where failure is much worse than not having tried at all." That magnifies how important it is the review be good, and how much of a problem bugs that sneak through are, which points towards doing smaller chunks.
How significant each factor is depends on details: how easy the task is to verify, how well-specified it is (and more generally how much it's in the models' wheelhouse, and how much in mine), how bad a bug would be (fun thing? internal tool? user facing? can lose data?).
I think the dynamics above apply across a range of model strengths, but that doesn't mean the changes from say Sonnet 3.7 to Opus 4.5 didn't mean anything; the machine getting better at getting the info it needs and checking itself still helps at shorter task lengths. Harness improvements can help, e.g. they could help keep models of the 'too much context, model got silly' zone (may be less severe than it once was, but I suspect will remain a thing), build better context, and clean up code as well as spitting results out.
Besides taking more of your time up front, involving yourself more also tends to drift towards you making more of the lower-level decisions about how the code will look, which I find double-edged. You have better broad context, and you know what you find maintainable. But the implementer, model or another person, is closer to the code, which helps it make some mid-to-low-level decisions well.
Plan modes and Spec-Kit type things can help with the balance of getting involved but letting the model do its thing. I've liked asking the LLM to ask a lot of questions and surface doubts. A colleague messed with Spec-Kit so it would pick one change on its fine-grained to-do list at a time, which is a neat hack I'd like to try sometime.
Re: Are the costs of AI agents also rising exponentially? (2025)
#128It’s true that at a given point in time the cost to achieve a certain task follows exponential curve against time taken by a human. But.. so what?
Re: Are the costs of AI agents also rising exponentially? (2025)
#129The sweet spot thing is the real insight here and nobody seems to be talking about it. Frontier models get hyped for their maximum task horizon, but that's also where they're 10-30x more expensive per hour than their optimal range. You're paying a massive premium for the hardest tasks and still failing half the time. Honestly the practical takeaway is pretty boring: just break your work into smaller chunks. Not becau…
Re: Are the costs of AI agents also rising exponentially? (2025)
#130Once a model is stable and good enough, for example Sonnet 4.6 or GPT 5.4 (or something else in future), it can be burned into hardware like Talaas chip reducing the cost many times and increasing the speed. At some point we can rely on old model while being productive with it.
I always wondered why the equivalent of integrated mining didn't apply to LLM inference... now it turns out it does and there's a company making it fast and robust!
But, sounds like Taalas is trying to strike an interesting balance where they can at least spin up ASICs for new models reasonably quickly with their modular design. It’s a really interesting bet, and might pay off.