You can pay 1 cent for a mediocre answer or 2 cents for a great answer.
So a lot of these things are relative.
Now if that equation plays out 20K times a day, well that's one thing, but if it's 'once a day' then the cost basis becomes irrelevant. Like the cost of staplers for the Medical Device company.
Obviously it will matter, but for development ... it's probably worth it to pay $300/mo for the best model, when the second best is $0.
For consumer AI, the math will be different ... and that will be a big deal in the long run.
Right now I'll pay 2x for a subjectively 20+% better coding agent. But in a year I don't think there will be an agent that to me is subjectively 20% better amongst the big three.
So where is the moat for these companies then, in the end will they all be almost the same from the pov of a normal person? So it's just price competition?
> You can pay 1 cent for a mediocre answer or 2 cents for a great answer.
But Gemini is also a great answer (possibly slightly less great or more great).
When consumers cannot easily assess a product's quality, they frequently use price as a primary indicator, equating higher costs with superior quality.
So a lot of these things are relative.
Now if that equation plays out 20K times a day, well that's one thing, but if it's 'once a day' then the cost basis becomes irrelevant. Like the cost of staplers for the Medical Device company.
Obviously it will matter, but for development ... it's probably worth it to pay $300/mo for the best model, when the second best is $0.
For consumer AI, the math will be different ... and that will be a big deal in the long run.