Execs Confused and Horrified by the Huge AI Bills After Thinking They Could Replace Workers for Free

[HeartachesNhangovers]

32. Not so fast. This article is very incomplete.

There have been many stories recently about shocking AI usage fees after the AI providers recently started charging by actual usage rather than just a monthly license with unlimited use. That's all true, but the real problem is that companies upgraded to the most-capable AI models available whether they needed them or not, since the monthly license costs weren't very high. AI providers were surely keeping monthly license costs artificially low to grab market share and to hook employers on AI.

Employees were using these high-end models (capable, for example, of solving math problems that have stumped humans for decades) for even the most mundane tasks like sorting through their emails to make to-do lists. However, there are entry-level AI models or even free models that can do most of the work that employees had been mis-using high-end models for. The problem was compounded because some employers were requiring employees to use AI models for as many tasks as possible, with no consideration of the type of model being used.

I think that low-cost AI models will continue to replace human labor for many tasks (administration, most programming, etc, etc), and that use of the most expensive, cutting-edge models will be restricted to the few employees that actually need them. Many companies will probably find that they don't actually have any use for the most expensive AI models.

But if AI providers think that companies are going to continue to pay for unrestricted employee use of high-end AI models, they're wrong. Why would they throw money away like that? AI is in a bubble and this is the start of the AI consolidation.