Markets
The AI COGS Problem: Per-Seat AI Products Run ~40% Lower Gross Margins Than Usage/Outcome-Priced Rivals
A structural margin gap is opening: vendors that keep charging flat per-seat fees for AI features absorb the variable inference cost themselves and post ~40% lower gross margins than competitors who pass compute through via usage- or outcome-based pricing. This 'AI COGS' compression is now a board-level metric and a forcing function pushing vendors off the seat model regardless of go-to-market preference. For builders, it reframes pricing as a margin-survival decision, not just a packaging choice.
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