[jpalomaki]

> they make more money if you have to perform more searches.

I believe the reason for the pricing is Kagi's cost structure. Accessing for example Google index is not free. Since they don't show ads or monetize the user in other ways, they need to pass the costs to customers.

Pay-for-what-you-use models are not common for consumer services, but I think it is a healthy pricing model. Better than fixed price packages, where you assume 80% of low volume users will cover the costs for the 20% heavy users

[pbronez]

It’s tricky because there are subtle psychological effects when marginal use directly incurs marginal cost. It makes each use a decision.

When you assemble tools for cognitive work, it’s important that they have low overhead. Thinking about the financial cost of using a tool is a small context switch that slows you down. Thus a bundle of prepaid stuff increases the utility of the service beyond what you’d get with pure pay per use, even though the latter is more economically efficient.