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Using smaller, cheaper LLMs can increase total workflow costs due to hidden expenses like review time and error correction, highlighting the need for comprehensive cost tracking.
An analysis arguing that AI automation demos often gloss over the ongoing operational costs of monitoring, fixing, and maintaining systems, leading to 'false productivity' where teams spend more time managing the AI than doing the original work.
The article argues that most AI chat app pricing models are unsustainable because they hide complex costs like retries, context growth, and multi-model calls behind flat subscriptions, and suggests usage-based pricing with limits and overages is more viable.