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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

#501

Post by [deleted] »

ricardobayes wrote: post #179
CharlieDigital wrote: post #4

$1500/mo is $18,000/seat/annum. Maybe Microsoft and Nvidia are on to something. 128 GB machines that can run local LLMs are a bargain even if priced $5-8k. Yes, tok/s is not quite there, but that's probably OK since the bottleneck really isn't the code; it's WTF did Uber build with all of that spend? How did it meaningfully impact their revenue in a positive direction?

128GB machines can't run anything locally that is even nearly as capable as a frontier model like Claude. We can get an idea from deepseek v4 pro being 1.6T model, requiring approx. 860GB VRAM to run.

[deleted]

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

#502

Post by timacles »

geysersam wrote: post #345
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…

Current AI datacenter/model development investment rate is roughly 1T/year. That's a lot. But the US economy is 33T/year. So the investment pays back (roughly) over ten years if, each year, the AI investments increase overall productivity by 0.6%, assuming the AI companies can capture half of the value of that productivity gain. > „[AI vendors are] paying for a fixed cost with a depreciating commodity“ That's just a…

I'm surprised people think LLMs, a thing which mainly excels at advertising, spam and writing code is going to generate that much economic activity.

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

#503

Post by adithyassekhar »

sfn42 wrote: post #472
sevenzero wrote: post #156

Earlier quoted context omitted.

Nah the codebase is legacy fucked and I cant be bothered to try and optimize business flows without the fear of other stuff breaking. Claude 100% of the time even thinks we use laravel despite the project being some old lumen codebase, so most of laravels features are not available. It also gets the PHP version we are using wrong 100% of the time.

Have you tried adding this information to claude.md so it knows? I also think your excuse is bad. "The code is legacy fucked so I'll just legacy fuck it some more because I can't be bothered to make an effort"

This is a spicy take, unless the business is willing to face some down time, and I am hired to do exactly what you said, I’d never touch any line of code unless I absolutely have to. Different environments don’t help as much.

We tend to obsess over software quality when it’s the least important thing for a business. It’s just a means to an end.

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

#504

Post by cousinbryce »

marcosdumay wrote: post #401

Just to put this in context. If every company did this, all over the world, with that same limit, we are talking about something around $45B monthly in revenue for all AI companies to share.

World bank says there are 3.7B employed humans. Putting the total addressable market at around 67T if all of us spend USD 1.5k on tokens every month. This lines up well with current forecasts from the major AI labs

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

#505

Post by notnullorvoid »

thundergolfer wrote: post #373

> 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. I…

Both metrics are valuable.

If one uses AI minimally and is able to out perform peers who are maxing out AI spend, one might want to use that in salary negotiations.

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

#506

Post by dzhiurgis »

corpoposter wrote: post #484
WarmWash wrote: post #349

Earlier quoted context omitted.

They'll ban them because (unless run locally or self-hosted) they are just data capture tools for the China.

If it’s open weight then anyone can run it for you. Presumably someone you trust just as much as US proprietary models.

I don't think they'll offer open models for long. Since they've actually invested in power, cheap chips, cheap memory and can subsidize tokens - they'll keep undercutting big models to capture data forever. Bonus if they remove ridiculous safeguards and China will be unstoppable.

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

#507

Post by NichoPaolucci »

dzonga wrote: post #488

> That means each employee's AI spending cap is ~11% of that median compensation package. when looking at costs - numbers make sense. however decisions as an org/company/solo founder - costs help you set prices, but to reach profitability you want to model around ROI. now the question is what's the ROI for a $36K/investment per engineer or $90M for the total org ? I bet the ROI is negative.

I'm in a similar boat - it's hard to measure, but let's say you pay an engineer 150K. Giving them a tool that costs 15K a year is effectively a 10% increase in that expense.

If we were seeing 3X, 5X etc improvement from individual engineers, that 10% increase in expense would be a fantastic investment (even 3 engineers for the price of 1.1??!). I have a feeling they are just not seeing that much of an improvement.

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

#508

Post by NichoPaolucci »

ksajadi wrote: post #465
suncemoje wrote: post #328

Lock-in / switching costs are increasingly concerning me. I am using Claude for a good year now and have been accumulating so much "knowledge" in there by now. If Claude became less favorable in terms of price/performance in the future, that would worry me. I've started to think about a distributed solution, where my storage is detached from the inference, but currently Claude is still the way to go for me. Wondering…

This.^ I realized this first when moving a design spec from Claude chat to Claude Code and panicked. I literally had to build something like Notion but for agents to act as a portable memory between all cloud and local models and agents. But honestly it paid off! If you are interested you can try it out at markbase.cloud (disclaimer and all that). I am not charging for it.

We run a "context" repository that enables us to transition pretty seamlessly from model to model (usually codex to claude and back). It has skills / plugins / connectors / tooling in relatively malleable MD files. That's what I see as the future. Rather than exporting IDE settings we'll just carry our markdown to the next best tool.

It's hedging a bet at this point, but that's why people say there's no moat. If the tools are properly used + maintained, there should be no reason we can't use a new provider even next week (maybe with a little tweaking).

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

#509

Post by dakolli »

tokioyoyo wrote: post #452
dakolli wrote: post #396

Earlier quoted context omitted.

They charge the exact same prices. So many people in these comments have no idea what they're talking about. Even if they did charge less, nobody is going to deal with the latency of sending requests to China. edit: Actually American inference providers are cheaper for Chinese models. There's way more competition here because the Chinese aren't idiots and investing every last dollar they have into data centers for ll…

Can you please link me DeepSeekV4 provider that's cheaper than their official offering? And not all tasks require low latency. Also, there are a lot of competition in China. Like a lot. You might know better than me as well, but although the biggest AI-labs are based in USA, the adoption is weirdly global. Like as a general sense of what's going on - you can see AI-related ads literally everywhere in Tokyo, almost al…

Deepseek's api platform for V4 Pro is the only example of this, and Deepseek V4 Flash is cheaper (usually) than from Deepseek itself on openrouter via DeepInfra.

Deepseek shot themselves in the foot because they never intended to serve V4 Pro for .80c mm ouput, that was a promotional price that was meant to expire (and still might). They intended for v4 to cost $4.00 per million but Western inference providers drove down the price because they can operate at negative margins to try and push competition out. I can assure you they are losing a ton of money @ ~80cents.

My point is, its Western inference providers that are establishing the floor price of inference. They are willing to operate at a loss in order to put their competition out of business. Chinese providers are typically at or above the prices set by American/western providers if you go looking on the Chinese internet. You aren't going to get deals from China for inference except through this one instance with Deepseek v4 Pro which wasn't even supposed to be permanent pricing.

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

#510

Post by foolserrandboy »

scuff3d wrote: post #339
OptionOfT wrote: post #206

Earlier quoted context omitted.

Because companies are betting that this spending will allow them to reduce cost by firing people. Right now the AI LLM PRs we're seeing are just introducing more work for other people, while these so-called builders are looking good with their new dashboards and functionality they're demoing. But you can't talk to them about the flow of the code. You can't ask them for their thinking as to why certain things are. It'…

Literally in the middle of ripping apart a vibe coded mess at work to figure out what's even worth keeping. Not fun :(

What happens if you just keep vibe coding is? Does it whack-a-mole fix one area and break another?
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