For years, flat-rate AI subscriptions heavily subsidized power users, masking the true cost of token consumption. As providers shift to usage-based billing, this subsidy is ending. Enterprises now face "sticker shock" and must justify AI spend with clear ROI, moving from rampant experimentation to cost-conscious implementation.

As more companies integrate AI, their costs are tied to variable usage (e.g., tokens, inference). This is causing a profound, economy-wide transformation away from predictable seat-based subscriptions towards more dynamic usage-based models to align costs with revenue.

While AI agents will be used personally, their high token costs make the return on investment far greater in enterprise settings. An agent's ability to generate output that directly impacts GDP means business use cases will receive development priority over consumer or personal automation.

The AI market has cleared its first ROI hurdle: model revenue has justified massive infrastructure investment. Now it faces a second, harder test. Enterprises spending billions on AI tokens must demonstrate tangible financial benefits, like higher margins or revenue, to sustain the flywheel.

The most heated topic among Fortune 500 CIOs is no longer which AI model is most powerful, but how to manage unpredictable and soaring token costs. Companies are struggling to find the right strategies—from workload prioritization to user-based access tiers—to create a predictable cost model in a rapidly evolving tech landscape.

The AI industry has shifted from a subsidized model to a "token shortage" era. This forces all companies, from AI providers to enterprise users like Uber, to prioritize cost-effective usage. Business models are now usage-based, making architectural and financial efficiency paramount.

According to Mike Cannon-Brookes, advanced enterprises are not tracking AI success by counting tokens. Instead, they are asking harder questions about overall output, such as engineering productivity and quality. They understand that high token usage doesn't always correlate with high productivity, shifting focus from raw usage to tangible business outcomes.

While foundational models are metered by tokens, vertical AI solutions in specific domains like healthcare or finance will increasingly compete by charging for measurable business outcomes. Customers will hold these apps accountable for delivering tangible ROI, making outcome-based pricing a key differentiator.

To combat the unpredictable costs of token-based AI usage, Pega is adopting a value-based pricing model. Instead of charging per token, they charge based on work completed (e.g., per loan funded or service request processed), aligning costs directly with business outcomes and enabling forecasting.