[fluoridation]

>If it's constantly being used, it will wear out faster.

Yeah, but there's an absolute limit to that, beyond which the cost doesn't keep increasing. Beyond that point, the QoS goes down (queues).

>You are conflating "we price based on expected under-utilization" with "costs don't scale with usage."

I'm not conflating anything, I'm responding to what you said:

>If gyms faced a situation where people would go and spend 18 hours working out every day for a month, they would probably change how they billed things.

Why would a gym need to change how they bill things if all their customers were aiming for maximal utilization, when their costs would barely see any change? I doubt your typical gym operates on razor-thin margins.

[dimmke]

Gym costs absolutely scale with usage. Equipment wears faster under heavier use. Cleaning and maintenance staff hours scale with how much the facility is used. Consumables like towels, soap, and chalk go faster. HVAC runs harder. The reason gyms can offer flat-rate pricing is that they bet on under-utilization, not that costs are flat.

Setting that aside, even if we accept your argument that gym costs barely scale with usage, then that makes gyms a bad comparison case for Anthropic, whose costs directly scale with usage. You can't use the gym model to defend Anthropic's pricing decisions if the two cost structures are nothing alike.

I'm arguing that both gyms and Anthropic have usage costs that scale with usage, but gym business model assumes a large margin of under-utilization and there's a hard cap to "power user" - I think both of those extremes don't apply to Anthropic's situation. Under-utilizers aren't paying for AI they have a free tier. There's also a natural ceiling on how much any one person can use a gym. There's no equivalent constraint on API usage.

[fluoridation]

>You can't use the gym model to defend Anthropic's pricing decisions if the two cost structures are nothing alike.

Am I? I think you read something into my comments that I didn't write.

[krisoft]

> The reason gyms can offer flat-rate pricing is that they bet on under-utilization, not that costs are flat.

Yes. In fact i remember hearing about a gym which offered a flat-rate pricing model but explicitly excluded certain professions from partaking in it. I remember the deal was excluding police, bouncers, models, actors and air stewardesses. They had a separate more costly tier for these people. (And I think i heard about it from the indignation the deal has caused online.)

[TeMPOraL]

> Under-utilizers aren't paying for AI they have a free tier.

Sure they do. Free tiers suck. I may not always need to use AI, but when I need it, I don't want to immediately get hit by stupidly low quotas and rate limits, or get anything but SOTA models.