Comment by port11
11 hours ago
I know of a very serious business that deployed Max to all of their developers. API pricing, from what I see, can become more expensive than just hiring another dev.
11 hours ago
I know of a very serious business that deployed Max to all of their developers. API pricing, from what I see, can become more expensive than just hiring another dev.
We're also not seeing much difference in real throughput at an agency. Everyone is getting decent results, output wise but it just doesn't seem to change the outcomes that much. There is also a mixed incentive at an agency, because a reduction in hours spent is a reduction in revenue.
It will be interesting to see how it all plays out, but I suspect if cost continues to increase and output only improves incrementally from here, that the cost will be the final decider rather than the competence.
I could see it being a thing we use only sometimes, for some things, but ultimately remain reliant on developers to get the work through the pipeline.
API usage is on-demand, employees are a constant cost, guess what management loves most.
Well yes it is expensive, but companies are paying for that. It is far more expensive than the Max and it does go up to or more in some cases compared to the employee salary.
Larger companies are using Claude through AWS Bedrock and are willing to easily pay $5k+ per engineer per month for it.
The thinking appears to be that a model that can do the work of a developer must be worth a significant share of a developer salary. I think this idea is flawed.
Developer salaries are driven up by scarcity - scarcity of developer skills overall and scarcity of developer skills in specific places like California. If AI models destroy the scarcity then the price worth paying for a coding agent will drop dramatically.
Maybe Anthropic can get away with it for a couple of months. But this will not last.
But if e.g. a developer can do 50% more, shouldn't it be worth it to pay up to 50% of developer salary for the product?
So the % is debatable of course. There's cases where an AI agent can save weeks worth of investigation, there's cases where you are mainly blocked due to processes, and many different circumstances. It's up to every company on their own to decide it. But if they decide it's 50%, why shouldn't they spend 50% of salary on it?
Like imagine a large company with thousands of microservices. You need to build a feature, before you had to setup cross timezone team meetings to figure out who owns what, what is happening in each microservice, how it all connects together. But now you can essentially send an AI Agent to scour and prepare all this material for you, which theoretically in this planning could save hours of back and forth meetings.
If 1 hour / 1 eng costs $200, then a 10 people 1h meeting avoided would save $200 x 10 = $2000 alone.
I don't see it as a replacement for dev, it's more of a multiplier.
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