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Uber's $1,500/month AI limit is a useful signal for AI tool pricing

simonwillison.net

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Re: Uber's $1,500/month AI limit is a useful signal for AI tool pricing

#371

Post by Gigachad »

javier2 wrote: post #362
tuesdaynight wrote: post #138

Why there are so many people that still believe that AI coding is a fad? It's something that started less than two years ago and companies are already paying thousands per seat. I know one that gives you 5k per month. Which other tool went from nothing to this level of acceptance so quickly?

Because the vibe coded stuff is sometimes great, sometimes it breaks stuff, sometimes it breaks things that we fixed multiple times earlier. The PRs are too large, nobody can review that mess and you better be on call for your deployment. Maybe it will get better, maybe not. I dont know yet.

The massive PRs is something that probably has to end. You can ai generate smaller changes in reviewable PR sizes. It probably even helps the AI code review tools to break the work in to smaller logical chunks too.

Re: Uber's $1,500/month AI limit is a useful signal for AI tool pricing

#373

Post by thundergolfer »

> That means each employee's AI spending cap is ~11% of that median compensation package.

Probably better to use the fully-loaded cost of the engineer, which is much higher than their compensation package. The fully-loaded cost is the total cost paid for the labor power of the engineer, and it includes big ticket items such as office space, food, equipment, insurance, payroll tax, fringe benefits, recruiting costs.

If the median compensation package is $330k/year then the median fully loaded cost is probably around $450-500k.

Re: Uber's $1,500/month AI limit is a useful signal for AI tool pricing

#374

Post by nothercastle »

bijowo1676 wrote: post #314
whateverboat wrote: post #197

Earlier quoted context omitted.

Today's data center GPUs are essentially overclocked, and so at limit of how much the chip materials can physically handle, and therefore degrade over time. For example, GH200s operate at 1W/superchip but the actual safe power is somewhere around 650W which will allow them to function for a decade or more. But that leads to around 15% slowdown and that is unacceptable in today's competition. So current GPUs are desti…

i think its reasonable to give up 15% of speed for a decade more lifetime. This depreciation change alters economics of GPU

That extra decade might provide almost no revenue. The long tail isn’t profitable

Re: Uber's $1,500/month AI limit is a useful signal for AI tool pricing

#375

Post by [deleted] »

f311a wrote: post #37

How many more months do we need to wait, until big companies realize that flash models work just fine if you: 1) Don't ask LLMs for big changes 2) Review everything and point them in the right direction Large models still suck at big changes, they produce questionable architecture and you still have to review the code, if your project is serious enough. The codebase quickly become a mess, if you don't pay enough atte…

[deleted]

Re: Uber's $1,500/month AI limit is a useful signal for AI tool pricing

#376

Post by lazide »

missedthecue wrote: post #330
biztos wrote: post #326

Earlier quoted context omitted.

In order to not un-build the data centers, they at least have to make more than it costs to operate them, and also not have some attractive liquidation value (the land, maybe). I could imagine something like “inference is done at home or in China, that’s the price to beat” and it’s not worth keeping all those GPUs cool out in Nevada.

But the parent comment was that one of the bigger costs in these data centers was the interest expense on the borrowed money. A restructuring removes or heavily reduces that amount. The fiber laid during the dotcom bubble never paid back the investors or lenders, but it's still profitably connecting customers all these years later.

Yup, that is the real economic benefit of bankruptcy - a reset.

Re: Uber's $1,500/month AI limit is a useful signal for AI tool pricing

#377

Post by ozim »

bijowo1676 wrote: post #171
dgellow wrote: post #164

Earlier quoted context omitted.

One aspect Paul Kedrosky mentioned recently is the concept of „duration mismatch“. The price per token goes down over time (either because the AI vendor reduces due to competition pressure, or because customers are now incentivized to use older cheaper models). But datacenters are financed through debt, with the assumption their revenue increases over time. Quoting him: „[AI vendors are] paying for a fixed cost with…

do GPU chips really depreciate physically? There are no moving parts, I dont think memory chips or GPU chips deteriorate naturally. I think its only accounting depreciation. I have been using my laptop for a decade, what is stopping datacenters from using the purchased GPU chips for a decade?

Transistors do wear out. Not going to elaborate as it is easy to ask GPT

Re: Uber's $1,500/month AI limit is a useful signal for AI tool pricing

#378

Post by jmtulloss »

f311a wrote: post #37

How many more months do we need to wait, until big companies realize that flash models work just fine if you: 1) Don't ask LLMs for big changes 2) Review everything and point them in the right direction Large models still suck at big changes, they produce questionable architecture and you still have to review the code, if your project is serious enough. The codebase quickly become a mess, if you don't pay enough atte…

Is your argument that $1500 / mo is too much? Why would the engineering team not be more rigorous in their model selection given a constraint?

Re: Uber's $1,500/month AI limit is a useful signal for AI tool pricing

#379

Post by lazide »

consp wrote: post #283
bgnn wrote: post #262

Earlier quoted context omitted.

Chips age and fail with age. You can check hot-carrier injection, bias-temperature instability and electromigration as they are the main aging mechanisms. All if these are a linear function of time but exponentieal of temperature. 90-100C these chips are running at are really tough, so they are likely to fail at couple of percent to 10% range in 2-3 years depending on the margins they have in the design. The solder j…

If those don't go the caps and coils will eventually.

Caps also have a rapid aging with temp.

Re: Uber's $1,500/month AI limit is a useful signal for AI tool pricing

#380

Post by throwatdem12311 »

marcosdumay wrote: post #367
javier2 wrote: post #362

Earlier quoted context omitted.

Because the vibe coded stuff is sometimes great, sometimes it breaks stuff, sometimes it breaks things that we fixed multiple times earlier. The PRs are too large, nobody can review that mess and you better be on call for your deployment. Maybe it will get better, maybe not. I dont know yet.

Oh, it won't get any better. LLMs already trained on every bit of code ever published, they won't get any more material.

If anything the snake is eating it’s own tail because now it’s training on vast amounts of its new slop…dragging down the average bar of quality.
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