Usage-based pricing

What is usage-based pricing?

Usage-based pricing is paying for how much a service is used, such as tokens, tasks or records, instead of a fixed fee for each user. AI model providers price this way: Anthropic, for example, lists rates per million input and output tokens. Many AI tools mix models, with a base fee, included usage and charges for overage or prepaid credits.

Why it matters to a revenue leader

Seat pricing made software cost easy to budget: count the sellers, multiply by the license. Usage pricing ties cost to activity, so the bill moves with how hard the team and its agents work, which can be fair and can also surprise you when an agent runs more often than planned. For a services company, the model is familiar: it is how you bill time-and-materials work, while seat pricing resembles a fixed monthly agreement. Before signing, a leader should know what counts as a unit of use, what a normal month costs and what happens at the cap.

A security services company with 30 sellers compares two AI tools. One charges $90 per seat, or $2,700 a month. The other charges $0.40 per account researched; at 5,000 accounts a month it costs $2,000, but in a heavy prospecting month of 9,000 accounts it costs $3,600.