AI's escalating costs force executives to recalculate the business case
Source: The Register: Biting the hand that feeds
The economics of large language models—particularly the inference costs of running tokens at scale—are creating genuine friction in boardrooms where the ROI math no longer works. CFOs are discovering that the computational cost per transaction makes many proposed AI applications uncompetitive against traditional software. The industry will likely segment sharply between a small number of high-volume, low-margin players (cloud giants, search) who can absorb token costs and everyone else scrambling for narrow, defensible use cases where AI's margin contribution justifies the infrastructure spend.