CEOs laid people off to replace them with AI, but turns out AI is more expensive and does a worse job.
If I made a blunder of that scale, would I or would I not be put on a PIP?
Companies rein in AI usage as costs strain budgets
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Re: Companies rein in AI usage as costs strain budgets
#12I genuinely have no idea how some of these companies got so far over their skis on AI. It simply does not make sense to me.
Out of touch leadership and management combined with a culture of self-congratulatory "innovation" where companies just plagiarize eachother in an endless loop... It doesn't surprise me at all, tbh.
Re: Companies rein in AI usage as costs strain budgets
#13Re: Companies rein in AI usage as costs strain budgets
#14CEOs laid people off to replace them with AI, but turns out AI is more expensive and does a worse job. If I made a blunder of that scale, would I or would I not be put on a PIP?
CEOs generally suffer zero consequences for their decisions, unless that decision costs someone real money.
Re: Companies rein in AI usage as costs strain budgets
#15Does anyone know the inside story of some of these AI adoptions that have been downsized? The company I’m at has only only recently gotten an enterprise license.
We’ve had our AI budget per Engineer cut twice now since the peak mania in early 2026 and Fable was banned even before it was removed by Anthropic due to cost. It’s still used a lot but I think maybe they’re not really seeing the ROI especially when some people spent thousands and thousands per month on dubious AI things.
Personally I truly can’t manage that many tasks (really 1 or 2 max) in parallel with these since you need to think very hard about everything the AI spits out because they’re such natural bullshitters and you end up in places where no one on the team understands anything in the project
Re: Companies rein in AI usage as costs strain budgets
#16I remember back when ChatGPT first came out, there was an article on HN about this AI researcher who worked for one of the big companies (I think Google) who came to believe the model was truly intelligent and that it was being abused by being locked in the machine. We all laughed as the guy had clearly lost his mind to AI psychosis. What we didn’t realize is he may have been patient zero.
This is the delusion that went viral, or at least one version of it. It all leads back hijacking the human tendency to anthropomorphize, leading to the belief that an LLM is somehow something more than it actually is. So the question is - what breaks the spell? Failed attempts to automate that don’t work out? The realization that the return on money spent doesn’t make sense? Furthermore, how to we accelerate the eventual realization?
Re: Companies rein in AI usage as costs strain budgets
#17Does anyone know the inside story of some of these AI adoptions that have been downsized? The company I’m at has only only recently gotten an enterprise license.
Probably looks like this:
- teams blitz through Jira tickets
- developers figure out they can't keep up with reviewing the code
- too many new features pushed at once, rushed work to develop training materials
- features don't work as good, many edge cases come out in support tickets
- tickers return to Jira board
- teams spend time triaging and fixing with less AI
- some features turned out to be mistake, but now have to stay
- once mess is cleared, return to "normal" pace, no AI agents, Cursor allowed with budget cap.
Re: Companies rein in AI usage as costs strain budgets
#18> The ride-hailing company has introduced usage caps, limiting employees to $1,500 in monthly token spending on individual AI tools, after blowing through its entire AI 2026 budget by April.
Right, because they set their 2026 budget in 2025. And in 2025 nobody could predict how good (and token-hungry) coding agents would get after November 2025.
I'd be surprised if any company that set an AI budget for 2026 hasn't blown through it by now, assuming their staff have picked up Claude Code or Copilot or Cowork.
Re: Companies rein in AI usage as costs strain budgets
#19> Since the start of the year, Chinese AI models have overtaken their US counterparts in token consumption, according to data from OpenRouter, an aggregation platform that allows users to access multiple AI models.
That's a bit of a dodgy statistic. OpenRouter only tracks their own users - the vast majority of API customers for OpenAI and Anthropic presumably go straight to their APIs.
Re: Companies rein in AI usage as costs strain budgets
#20I genuinely have no idea how some of these companies got so far over their skis on AI. It simply does not make sense to me.
I'm consistently burning over $100/day in Claude/OpenAI tokens using Codex and Claude - but I'm on the subscriptions so I'm only paying $100/month to each vendor.
If I worked for a larger company that isn't allowed to use those subscriptions and has to pay list price I'd be costing them ~$2,000/month. Now times that by a large engineering team.