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Microsoft starts canceling Claude Code licenses

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Re: Microsoft starts canceling Claude Code licenses

#81
post #35

Thus does kind of beg the question: If developers are being laid off because AI is better/faster/cheaper or makes all their people 10x or whatever fig leaf, what happens if the required tooling ends up being more expensive? From the investor’s point of view is the drag of employee costs better or worse than a ballooning expense item?

[deleted]

Re: Microsoft starts canceling Claude Code licenses

#82
post #35

Thus does kind of beg the question: If developers are being laid off because AI is better/faster/cheaper or makes all their people 10x or whatever fig leaf, what happens if the required tooling ends up being more expensive? From the investor’s point of view is the drag of employee costs better or worse than a ballooning expense item?

They lay people off and look good in front of investors. Then they hire people, talk about "growth", and once again look good in front of investors.

This would never fly if stock market was rational. But it never is.

Re: Microsoft starts canceling Claude Code licenses

#83
post #48

The way coding agent work is fantastically wasteful. All the megabytes of code are processed over and over and over, sometimes withing just one session. There are papers describing KV cache precomputation for commonly used documents (e.g. KVLink), but, of course, it's not a priority for model providers: they'd rather sell you more tokens, also they would rather get to AGI/ASI first than optimize usage of existing mod…

Claude code gets >98% KV cache hits. It’s not reprocessing unless you let the cache go cold (5 minutes, which is annoyingly short).

I meant caching on a bigger level. If you're an organization with 100 developers each doing 10 sessions a day, you're paying for 10000x tokens in frequently used document even if you had 100% KV cache hits within one session. Apparently that's too costly even for companies with trillion dollar market cap...

Normally KV cache works only if your context prefix is identical, but there are papers which demonstrate documents can be cached between different contexts.

Re: Microsoft starts canceling Claude Code licenses

#84
post #19

Lots of these places measure employee token use with managers having dashboards. It seems like performative code production rather than making anything useful. Speed without judgement always compounds badly.

Tokens are current era' "lines of code per month"

https://www.folklore.org/Negative_2000_Lines_Of_Code.html

Re: Microsoft starts canceling Claude Code licenses

#85

Feels about right. I've launched an internal demo of Claude Code and Deepseek on the same day and we burned through our monthly allowance for Claude in just over a week, with more than a half of that budget being spent in one day. With DS people are unable to go through that same amount of money in a month, not even close. With that Claude feels like an expensive toy, while DS is a shovel, purely because developers d…

Considered Gemini?

Google has burnt all of its goodwill in dev communities so no, I don't think Gemini is worth consideration.

Re: Microsoft starts canceling Claude Code licenses

#86
post #39

Earlier quoted context omitted.

There is no world where I can put my company’s data through an external site without their express consent and security sign off. I suspect at most companies there’s zero path for people to have been paying for it themselves.

An enormous percentage of America’s white collar work force has been doing this since 2023. Fun fact, up until you face a consequence for crime, all crime is free! Have fun and go win the competition game against your co-workers.

None of the 5 places I have worked is this possible, but they are also all highly regulated industries. Firewalls block virtually everything by default.

Re: Microsoft starts canceling Claude Code licenses

#88

Earlier quoted context omitted.

I suppose if it all works out it'll end up way more expensive than the employees the models displaced ever were. These kinds of technologies usually end up as an oligopoly at best, and those players will have a wide moat by then, and the things these models build will be tweaked such that no other model or human being can realistically work on them anymore, and then they can price gouge everyone to the brink of unpro…

At least the models don’t need health insurance, office space, a cafeteria, or have a threat of unionizing.

Shh, that's the quiet part the investors don't want to say outloud.

Re: Microsoft starts canceling Claude Code licenses

#89
post #5

There's definitely a way to use Claude code that is token conscious. I've tried throwing unsupervised agentic software factory workflows against the wall, and they burned through my tokens like nobody's business but didn't produce much. Supervised, human-in-the-loop process on the other hand is much more productive but doesn't consume nearly as much. Maybe that's why everyone's pushing agentic approaches so much.

> There's definitely a way to use Claude code that is token conscious.

Colleague used Sonnet 4.6 on some pretty normal agentic coding tasks through AWS Bedrock to keep the data in the EU, 100 EUR usage in a single day. In comparison, the Mistral subscription costs about 20 EUR per month and we tested that for similar tasks it was okay, the usage got to around 10% of that monthly limit in a single day. Or Anthropic's own Max (5x) plan where you get way, way more tokens to do with as you please.

I feel like the sweet spot is having a monthly subscription with any of the providers (you're subsidized a bunch), but if you have to pay per tokens, now I'd just look in the direction of what tasks DeepSeek would be okay for, sadly probably not in the situation above. For a startup, though...

On the other hand, this feels a bit hypocritical:

> It was part of an effort to get project managers, designers, and other employees to experiment with coding for the first time, and sources tell me that Claude Code has proved very popular inside Microsoft over the past six months.

They're gonna say that the future is all AI... until they get the bill.

Re: Microsoft starts canceling Claude Code licenses

#90

Earlier quoted context omitted.

At the enterprise level though, its going to be hard to want to use a service in which costs are not predictable, and keeping those costs under control requires employee training.

Am I losing my mind, aren't there multiple headlines each day about companies penalizing employees for not using AI enough?

That was roughly 3 weeks ago, with the reprising of Claude 4.7 and GPT 5.5, things have become more spicy.
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