Pricing AI Products Differs from Traditional SaaS: The Complex Reality
Pricing AI products is far more complex than traditional SaaS. Here’s why:
1. Variable Costs: AI models have unpredictable costs tied to usage, unlike the fixed costs of SaaS.
2. Dynamic Usage: Costs fluctuate with demand and model complexity, requiring advanced metering.
3. Feature Access:AI needs flexible pricing for different models and features, unlike standard SaaS paywalls.
4. Scaling Challenges: While scaling SaaS mainly involves managing user growth, scaling AI products involves dealing with performance and cost management across various models and workloads.
Controversial Questions:
Are AI companies making a mistake by forcing traditional SaaS pricing models onto their products? Is the industry ignoring the unique needs of AI pricing, and if so, what could be the consequences? How would the pricing space evolve?
Thoughts? Agreed, somewhat Although conventional saas is also moving more towards value based pricing. Ai product have a wider and deeper usage based use case