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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

#571

Post by ed_elliott_asc »

ValentineC wrote: post #104

> I noted that my own token usage comes to about $1,000/month against each of Anthropic and OpenAI - which currently costs me just $100 per provider thanks to their generous subsidized plans for individual subscribers. Do we know that AI providers are going to keep these per-token prices, or eventually lower them because of competition from China? Many lower-budget individuals are now moving to China open weight mode…

If Anthropic are then they are making a big mistake, their token hungry Claude code is far too greedy

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

#572

Post by Frieren »

seventhtiger wrote: post #308
chmod775 wrote: post #269

Earlier quoted context omitted.

Let's be real. Most of the time you ask an LLM "Why did you do it like this?", it responds with something along the lines of "Oops. My bad. You're right to point this out." You even have a fair chance of getting a response like that when there isn't anything wrong and the question wasn't rhetorical - which perfectly illustrates the level of the genuine understanding LLMs operate at.

When you criticize AI, always remember that the alternative is the average employee. Today's models are pretty good.

> the alternative is the average employee. Today's models are pretty good.

I have never seen anywhere in the world people that hates so much the working class as people do in the USA.

In my country the average employee is competent, they do their work and create wealth for the nation.

Again, only in the USA people think that billionaires are the ones creating value. Total non-sense indoctrination.

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

#573

Post by zkmon »

The big question is, will the productivity gains be absorbed by the needs? Societies don't have a need for infinite amount of luxury and laziness offered by the productivity of the machines. At some point, you would shake off things, get up from the couch and start walking again, breathing afresh.

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

#574

Post by 5701652400 »

dude250711 wrote: post #298
5701652400 wrote: post #191

eventually tokens will cost price of energy. and china is miles ahead. china will be major token exporter soon. mark my words.

Technically, tokens travel both ways.

Technically, on both sides there is an intelligence producing them.

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

#575

Post by phreeza »

lavezzi wrote: post #228
_jab wrote: post #186

Earlier quoted context omitted.

It's pretty simple; organizations are willing to tolerate paying $1500/month/engineer, which seems to be roughly inline with "normal" consumption for most full-time engineers. If that number grows significantly, then I bet companies will start exploring flash models more, as you propose.

They are willing to tolerate it now, which is quite a switch up from the free for all we had a few weeks ago, and if they aren’t able to tie in this new ~$1500p/m cap to demonstrable productivity and revenue increases then that will be kneecapped even faster

There are plenty of expenses in this order of magnitude that are not tied to direct increases in productivity. I think it may become a serious hiring impediment for companies to be really skimpy on these budgets for example.

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

#576

Post by 20k »

missedthecue wrote: post #304
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…

"So you have on one end the token revenue trending down, on the other end the training cost going up for the next frontier models, and you need to pay back your 10y debt." Not necessarily, the bond holders could simply take a massive hair cut and lose shitloads of money. On the topic of bubbles and exuberance, Jeff Bezos made the salient point that there was a massive over-invested biotech boom in the 1990s and tons…

Datacentres aren't the same as infrastructure or research though. All the hardware in them has a finite, useful lifespan. In 10 years time it'll be totally useless

Hardware fails, and also scales out in terms of efficacy to run it as more power efficient, modern hardware turns up. It requires constant investment to keep it useful, and cost efficient

When AI pops, we'll temporarily have some extra compute capacity that will be horrendously uneconomical to run due to the high grid load and low consumer demand, before they get shutdown. There's simply no real use for them at this scale

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

#577

Post by davedx »

Animats wrote: post #169
ValentineC wrote: post #104

> I noted that my own token usage comes to about $1,000/month against each of Anthropic and OpenAI - which currently costs me just $100 per provider thanks to their generous subsidized plans for individual subscribers. Do we know that AI providers are going to keep these per-token prices, or eventually lower them because of competition from China? Many lower-budget individuals are now moving to China open weight mode…

Raise them, more likely. NVidia says that GPU hardware prices won't decrease until at least 2030. The world is out of fab capacity.

Meanwhile, Google...

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

#578

Post by lelanthran »

therealdrag0 wrote: post #550
bunderbunder wrote: post #536

Earlier quoted context omitted.

Those companies are certainly writing more code. But It isn’t clear that they are increasing their economic productivity. It could even conceivably have the opposite effect by fueling a race to the bottom. e.g. an interesting possible canary in this coal mine is that there’s been a 200% increase in the rate of new apps appearing on Apple’s App Store, but it has not been accompanied by a 200% increase in the rate at w…

That’s great for consumers.

A lower signal/noise ratio is never better for consumers.

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

#580

Post by Buttons840 »

pm90 wrote: post #154
dangus wrote: post #143

Earlier quoted context omitted.

I don’t think companies will do that. Why don’t they just buy local on-premise infrastructure even though it’s cheaper than AWS? “AI in a box” sounds a heck of a lot like “the box” from the Silicon Valley TV show. Or the Google search appliance. Or name any other on-premise thing that is equally dinosauric. The real finding of this article is that AI tokens are direct competitors with offshoring. $1,500/month buys yo…

> I don’t think companies will do that. Why don’t they just buy local on-premise infrastructure even though it’s cheaper than AWS? For customer facing, production software, its worth paying a cloud tax to get the reliability guarantee. For tools that are used by engineers for code development, there is no need for such bulletproof guarantees.

Local AI servers are different because they don't have to form a single system. If one AI server goes down, just use the other one.

This is unlike customer facing systems where, if your database server goes down, you probably can't just use the other one--the whole system is down.

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