AI demands new pricing rules

For the first time there's cost dynamics to actually navigate. So you need to think about monetization from day one. But there's also a more critical reason, which is value capture.

In the classic SaaS situation, we used to say if you can charge 10 to 20% of the value, that's actually great. But in AI, you can actually charge 25 to 50% because it is autonomous, you're doing it with the AI.

"That" refers to ChatGPT's paid subscription business model that OpenAI launched after the free version became overwhelmed with demand.

The birth of that was just to turn away demand originally. It was not like we brainstormed, 'Oh, what is the best monetization model for AI?'

Every single bill we got, we allocated the cost back to the customer, or the transaction that generated it. And then we add our margin on top, and that's our price. You get those 20% of customers generating 80% of the costs, you give them a raise, and you drop the price to everyone else.