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garrickvanburen | on: DeepSeek peak/off-peak pricing update
Yes. I focus on pricing software and I’m a bit baffled why frontier models are pushing tokens.

It’s a race to the bottom, and the bottom is unlimited use for a flat monthly rate.

Granular pricing (tokens, minutes, etc) is pretty anti-customer generates less revenue than customer value-based subscriptions (why SaaS is such a good business model)

progval | parent | next
Isn't it because they have customers who will use as many tokens as they can? With a flat rate, they will run Gas Town continuously while paying as much as the occasional user.
throwup238 | root | parent
Yeah it feels like a very different model. I don’t try to fill up Apple/Google cloud drives to 1TB because then I’d have to clean up when I need space. I don’t bother trying to maximize my Audible subscription because there’s only so much I can listen to in a day. Even with my other AI subs that have monthly credits that don’t carry over, I just don’t have the interest or time to burn the credits.

But my Claude Max subscription? If I have any of my limit left the day of my reset, I’ll go and fire off research workflows with a bunch of parallel agents to explore whatever dumb ideas I had the past week. And there’s a 50:50 chance I’ll forget about it and never read the output.

loading story #49300386
Grombobulous | parent | next
But presumably consumers aren’t where the majority of the spend will be.

Consumers don’t generally get usage-based pricing because of the inconvenience and unpredictability, but B2B SaaS products utilize usage-based pricing all the time.

dakolli | parent
I've always been curious about who works on software pricing. Do you guys hire actuaries for this type of work?
kortilla | root | parent | next
For software that doesn’t make sense.

Pricing software is a game of estimating both software value and the purchasing power for customers. Only the latter might have any available data and even then it won’t be sliced the right way for any in depth statistical analysis that an actuary would perform to underwrite risk.

It’s much more traditionally a more salesperson like background where being in the target market or having strong connections to it dominates efficacy.

esafak | root | parent | next
Microeconomists. It's just a question of demand modeling. If you want to learn here is the bible: https://www.sup.org/books/business/pricing-and-revenue-optim...
| root | parent
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