Why is AI so expensive? The real cost drivers of AI
AI is expensive because the model bill is only part of the cost. Three components set the floor: model subscriptions, per-token API pricing, and infrastructure. Three more make it move: adapting models to your business, catching and fixing errors, and rising energy and datacenter costs. Efficiency doesn't fix it, because cheaper AI gets used more, not less. Businesses are willing to spend on AI. Research from Deloitte found that in 2025, 85% of organizations increased their AI investments.