No Limit for Better by Kevin Kelly

Pricing abundance is tricky. Netflix, Spotify, and millions of software apps are offered at a fixed price for unlimited use. That works — they make money — because in fact, there is not unlimited use of them. We get satiated pretty quickly. We only watch so many hours, listen for limited hours, or eventually stop scrolling. This may not be true of AI. It looks like the demand for AI can exceed our own bounded time.

AI is not going to be rolled-back. The big companies will continue to subsidise it, hoping they can make money eventually. The platform companies (MSFT/AWS/Google) are at present. Others may, later.

But how do you price it?

There will always be people who abuse the limits. Pricing per use would make sense, but people don’t like paying like that. They like a fixed cost.

The second thing is subscriptions subsidise heavier users. Not everybody who subscribes to 20$ per month will be using that much. Like how gym memberships work. The real question is this - is 20$ too less for even normal users.

I think OpenAI’s move to ChatGPT is a step in that direction. This would allow them to control cost a bit. Which we may not like, but is required for it to be a sustainable business.