AI now costs more than the people it replaced

Plenty of companies cut staff over the last two years and told everyone AI was cheaper. The bill just landed, and it turns out AI costs more than the people they let go.

An Nvidia executive told Axios that for his team, compute now costs more than the staff. Even Microsoft started pulling the AI coding tools it gave its own people, because the bill ran past the budget.

This isn't only a big company problem. AI is billed by how much you use it, so the more your team leans on it, the bigger the bill. I see it creep up on small businesses every month, and most of that growth is waste nobody can point to.

So I'm not telling you to use less AI. You should be using more of it.

You just have to stop paying for the waste. Three things decide whether AI saves you money or drains it.

First, match the model to the job. The most powerful model can cost five times more than the fast one for the exact same task. Save it for the hard thinking, and run everyday work on the cheap one.

Second, give the AI your business once, instead of re-explaining yourself in every chat. Every message pays for that context again. Set it once and reuse it.

Third, turn the jobs you repeat into a workflow you run, not a blank page you start from every time. You pay to build it once, not on every go.

The businesses that come out ahead will be the ones who set AI up to run cheap, while everyone else keeps paying to re-explain themselves all day.

Pick the one job you run most this week, and set it up the cheap way, with the right model and your business already inside it.