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Comment by simonw | Hacker News Reader

Ed's argument for why "AI is slowing down" rests on company spending caps, in particular the Uber $1,500/engineer/tool cap.

I interpret the exact same evidence in the opposite direction. A year ago the idea that a company would spend $1,500/month/employee on AI tooling felt absurd, what could people possible want to do with AI that would cost that much?

Then coding agents (and, increasingly, general purpose agents) happened and suddenly companies are having to set limits because otherwise the demand from their employees is too high.

The TAM of these AI companies just leapt up to $1,500/knowledge-worker/month, how is that "slowing down"?

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Maybe in USA in big tech where companies give absurd wages to engineers anyway in some states, that might be acceptable. But to make their ROI they need that (and more) to be spend world wide... no way that is gonna be a budget that is gonna fly in the long term...

Companies love to cut costs, and just like they axe employee numbers at will, they will just as well make that kind of budget quickly dissapear the moment they realize they can go a different path for same or better value... Or simply because share holder short-term value demands it...

The Uber $1,500/engineer/month thing is just the first signal we have had of the price companies may be willing to accept. This price will clearly vary wildly across professions, industries and geographies.

I think it's a poor number to build an "AI is slowing down" narrative around.

The problem is that $1500/engineer/month would be a pretty modest amount of demand for labs. OpenAI/Anthropic are basing their $1T valuations on the explosive uncapped growth of unlimited agentic token spending. On so many levels of the industry this growth is now priced in. You don't think so?

I don't have a particularly great answer to that question - I'm not enough of a financial analysis to have confidence in an opinion.

I do however think that shouting "look, Uber capped pricing at $1500/engineer/month hence AI is slowing down" is a questionable position to take.

> I don't have a particularly great answer to that question

Maybe you could use your $1,500 quota to ask AI for better arguments?

I mean, I did that already for my own curiosity... but I'm not about to share those on a public forum and pretend I have expertise that I don't.

>OpenAI/Anthropic are basing their $1T valuations on the explosive uncapped growth of unlimited agentic token spending.

No they're not. In reality, actual 'explosive uncapped growth of unlimited agentic token spending' will result in valuations several times more than a 'mere' $1T.

Uber is not the only company that's putting a per-developer limit on AI spending. I know this because I work for another one (and we have a significantly lower limit). You just heard about Uber first because they're high profile.

I didn't say they were the only company, I said they were the "first signal".

The more signals the better! What cap did your company pick, and what geography / kind of industry are you in?

(Sorry I'm being vague, but I'm not sure I'm not sure what's public knowledge)

The cap is moderately above the high subscription tiers, and managements/the executives were clearly extremely concerned about how expensive it would be if we all or even mostly came close to hitting it. I heard that they originally wanted to go lower but the developers in the pilot program blew past their planned limit very quickly.

As for the company, its almost entirely B2B SaaS (I think it has some offerings that are used by consumers, but they're mostly/entirely paid for by another business on behalf of their customers), and they have developers all over the world, although the headquarters and biggest group of developers is in silicon valley (my office is in the midwest).

It's also not $1,500 per month per engineer. It's that per month per engineer per tool. Which means it could easily be at least $3,000 (Claude Code and Cursor) or $4,500 if Codex was also an option on top of those two.

And as you have written on your blog it's a soft cap that can be exceeded with justification.

I don't know that Uber is generalizable. I also think specific company dynamics matter (are your execs encouraging tokenmaxxing, have you IPO'd or are you playing w/ VC money all of whom are encouraging tokenmaxxing, etc).

Another way you could take it is, avg Uber salary is what $300k/yr? Does Uber think LLMs make their engineers at most .5% more productive?

I don't really understand how engineers at Uber are hitting $1500/month. Are they forced to pay API costs?

My company provides employees with API keys and soft limits, but as soon as you approach ~$400/month they ask that you get a Claude/Codex Max subscription instead. Curious if it's not the same case at Uber.

Yes, companies like Uber are forced to pay API costs now - by OpenAI and Anthropic (and GitHub for copilot): https://simonwillison.net/2026/May/27/product-market-fit/#en...

>but as soon as you approach ~$400/month they ask that you get a Claude/Codex Max subscription instead

While this seems to be allowed because the current ToS don't seem to explicitly forbid it, I'd be surprised if this loophole stayed open for long... Why would they even distinguish between business and (much cheaper) individual plans if companies can work around it by telling employees to just pay for the latter themselves?

Enterprise agreements are billed at the API rate (albeit sometimes with committed spend discounts). There is no equivalent of the Max subscription in this context.

Saying its going to be 1500 a month across the board is highly speculative. How many companies can even demonstrate that they're getting more than 18000 dollars a year in surplus value per employee by using this tech?

How speculative would it have been to say that it was anything more than $20/mo back in November?

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