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points by pants2 23 hours ago | 0 comments

Really? Because you'd think for profit they would want to minimize token burn and therefore get away with lower limits on their plans

[–] adwn 23 hours ago

That only applies to subscriptions. Enterprise customers pay API rates and therefore per-token. Being wasteful would directly increase Anthropic's profit, assuming they're not selling them at a loss.

[–] NiloCK 19 hours ago

Overall I find this line of thinking pretty dubious. Competition exists. Yes, model provider X can run up my bill by instructing its model to do busywork. But I can easily swap to providers Y, Z, A, B, C.

I happen to find I'm receiving exceptional value from provider X, so I don't switch.

API customers can swap to alternate providers even more easily than subscription customers.

[–] stavros 22 hours ago

You meant to write "being frugal", I think.

[–] adwn 20 hours ago

I meant "being wasteful with tokens", as in, Anthropic makes more profit when Claude Code sends many input tokens and requests many output tokens when billing the customer for the API cost.

[–] brookst 17 hours ago

As long as price elasticity is zero.

[–] stavros 20 hours ago

Ahh, sorry, my bad.

[–] bronlund 23 hours ago

This is not about the bottom line, it is about proving to the marked that there is a demand - in order to attract more funding.

[–] jstummbillig 22 hours ago

What market is going to care about the number of tokens somebody uses? That's like a market that cares about the number of if statements in a piece of code. It's nonsense.

[–] adwn 20 hours ago

If Anthropic makes money on each token, the market would/will care very much.

[–] jstummbillig 9 hours ago

But they don't. If that was how making money with LLMs worked, everyone would just generate models that generate tokens that do nothing. But of course that is not how it works and they don't.

It's just really bad to do something with a lot of waste that someone else can do with less waste.

[–] pessimizer 15 hours ago

So what you're saying is that they're not actually trying to maximize profit, they're just trying to maximize profit to prove that they can maximize profit for investors?