Sorting Out AI Pricing

August 15, 2024

Written by Eric Krapf, General Manager and Program Co-Chair, Enterprise Connect Publisher

As enterprises continue exploring the potential benefits of Generative AI, the question of ROI has become paramount. Given how new and seemingly transformative Gen AI appeared at first, initial emphasis was on the “R” – what’s the return or benefit this technology provides? How much does it increase productivity? What processes can it shortcut or automate? What impact might this have on employees?

But the “I” side – investment – is looking to be just as complicated and difficult to pin down. Pricing models aren’t always clear, and the potential cost of implementing an AI application can be anything but predictable. That’s why it’s worth paying attention to a recent Forrester survey; as reported in CIO Dive, the research firm found IT leaders ascribing much of an expected rise in software spending to AI.

“More than 4 in 5 tech leaders anticipate their organization’s adoption of Generative AI features within SaaS products will increase software costs next year, according to the survey,” CIO Dive reported.

There’s no shortage of Gen AI-powered applications offered within SaaS products in the collaboration/CX space—from AI assistants that summarize meetings and offer enhanced productivity features, to CX-focused tools, mostly agent assist capabilities like call summarization. In some cases, the pricing is straightforward: Microsoft is charging $30 per user per month for Copilot, which at least lets the enterprise focus on the “return” portion of the equation. But since the benefit comes mostly from “soft” productivity gains like time savings, it’s still not simple to judge the payoff from that $30 investment.

Pricing models for some CCaaS applications are less clear, and if your enterprise decides to build its Gen AI capabilities rather than buying, you’re placing your bet on the complexities and evolution of the public LLM market.

At our upcoming Enterprise Connect AI event, we’re going to do our best to help you navigate the uncertain waters of Gen AI pricing, costs, and investment. On Wednesday, Oct. 2, Derek Top of Opus Research, a firm that’s led the way in scoping out AI pricing, will present a session on Tackling Gen AI’s Cost Conundrum. Derek will focus on cost drivers, risk, and other key elements of the pricing challenge that enterprises face.

We’ll also get a broader look at the ROI and pricing questions in our keynotes. David Glick of Walmart and Darrius Jones of USAA will both discuss their enterprises’ strategies around Gen AI, and how they’re thinking about the build-vs.-buy choices and other ROI-related issues.

Enterprise Connect AI takes place Oct. 1 – 2 at the Santa Clara, CA, Convention Center. The program focuses on the biggest real-world issues around AI—pricing, value, technical challenges, security, and much more. It’s not the place to go for AI hype; it’s all about how you can best use this revolutionary but challenging technology to gain competitive advantage and move your enterprise forward. I hope you can join us.