The comments I see recommending selective use of cheaper models doesn't match the reality I experience working in the industry. I have the constant threat hanging over my head of being fired if I don't churn out code quickly enough. I'm not willing to gamble with my livelyhood by using a less effective model.
Saving money on tokens isn't something that's rewarded during performance reviews; particularly because it's difficult to quantify how much you saved versus hypothetically using a more expensive model.
I think quantifying tokens used is analogous to quantifying the amount of sawdust generated on a construction site.
Churning out useful code quickly is not solved by using more tokens per unit time. Most non-technical leaders can grasp this one and are likely more interested in the strategic game theoretical dynamics that are being forced by way of implied token consumption expectations (competition between developers).
If you want to hold out as long as possible and don't really care about anything other than the compensation package, you should at least play along with this new game in a half-assed manner. Try to goldilocks your token usage between any established extremes. You want to be in the statistical barycenter of every AI report that management can create.
To understand the token count thing - spending tokens is necessary and not sufficient to demonstrate that you are adopting AI.
Where we were 6mo ago is that a lot of big orgs realized they were behind, and needed some way of measuring if the tools were usable at all.
No sawdust at all on your job site, and you can tell nobody is cutting wood.
Now that tooling is more mature, you can measure things like % of diffs AI-generated, % of AI suggestions accepted vs edited, % of KB queries successful etc - all more useful than raw token count for quantifying how your org is using the tool.
So it’s a pragmatic metric that got a bit Goodhearted.
> I have the constant threat hanging over my head of being fired if I don't churn out code quickly enough.
And the tragedy is that this isn't sustainable, and we all involved deeply in tech know this. There is eventually going to be a big reality check the companies will have to pay, because you can't force creativity and quality, not even with AI, because actual intelligence lies with us at least for now and for the foreseeable future. However when the rope eventually snaps these executives at best will fall upwards, with big severance bonuses and a list of "contributions" we have to be grateful for. We are the ones that will suffer through the next big layoffs.
Unfortunately, I think this is correct. Such as it ever has been with technological change. The folks at the bottom bear the brunt of the dislocation and the folks at the top pat themselves on the back for being so forward looking and get huge payouts regardless of the actual results. Further, the folks at the top are always incentivized to go along with the herd of their peers because if it works then they were on the bandwagon, and if it doesn’t work, well then, how could they have known because “Everyone was deceived.”
the companies will have to pay, because you can't force creativity and quality
Most companies do not care about quality.
_users_ who have to interact with that software will pay the price.
Exemple from one of the wealthiest company in existance, for one of its most strategic product: I was trying gemini-cli on some mcp servers just yesterday, with gemini-chat helping me configuring everything. In less than 10 minutes, I stumbled upon 3 or 4 different bugs. Eventually, even gemini-chat recommended that I throw gemini-cli in the bin and move on to another agent... That's the new norm.
How much creativity do you need to fix bugs in corporate code? Almost zero. It’s maintenance, not creative work. Nothing against it, it’s needed, but let’s be real, would anybody be really sad if this work is overtaken by LLMs? I certainly won’t be, let them do it.
Anyone (including ANTHROP\C) "recommending selective use of cheaper models" is spending costly human time (which costs more over time) on correcting the machine (which costs less over time). This is a bad trade.
In cost per line of code, we have verified this is always an error unless your time is worth less than the machine (unlikely unless you consider your time to have no cost rather than considering it as your hourly rate).
The worst thing for our productivity has been Claude Code or Claude Cowork taking a complex problem and turning around and writing bad instructions for dumb model agents then synthesizing the dumb answers into an orchestra of badness.
The single best fix for results-per-total-cost is to ensure it reads and thinks about whole content, not snippets, and thinks with the smartest model, not agents.
Agents should toil. Agents should neither think*, nor decide what to think about which itself is thinking.
* Agents should “think” like ants or bees or beavers think. Any human-like thinking, *especially* intuition-like thinking, should be thought by the best model available.
** Nobody should be “churning out code”. In a hierarchy of coders who translate detailed specs to some computer language, developers who write software that ships on a project timeline, and engineers who accomplish business goals, engineers should “churn out” engines structured for business outcomes.
Measured by that, the machine is leverage while reducing a variety of costs. At the same time, because most training data doesn't grok this, the machine doesn't grok it either. So it needs you to shape its toil.
I disagree heartily with everything here, both in personal experience from the models, and in values about coding.
I don't care bout cost, I care about getting good results fast.
Cost per line of code is not a suitable metric for anything. It's as silly as measuring engineers' performance by lines of code. More lines of code is worse than fewer lines of code. When you say "we have verified" whoever that "we" is makes a big difference, but you're posting pseudonymously, how are we to even guess at that "we"?
I get better results with some older cheaper models, faster. In particular older Claude models than Opus 4.7. Maybe the more expensive model churns out more lines, more complexity faster. That is a worse outcome for me. The complexity must be avoided at all costs. The simpler, smaller, answer is always better, and scales to bigger code bases. The more the model guesses at intent rather than checking intent, the more the model is clever rather than clear and simple, the worse the outcome, the more that the model turns into an architecture astronaut, the worse the outcome.
Too many people see wages as a sunk cost and a constant. One problem though is AI costs per task are unpredictable, and management tends to prefer predictable outcomes over optimal outcomes.
> The single best fix for results-per-total-cost is to ensure it reads and thinks about whole content, not snippets, and thinks with the smartest model, not agents.
I haven't seen "just absorb a giant ball of context and do the right thing the first time" be cracked yet, even for Opus 4.7.
At the end of the day, code is code, and we have decades of lessons about how to make code more reliable and maintainable. Composable small modules, not god methods, are still the way to go, and they reward devs who use them to get focused context for agents with faster - and often better - results.
If you’re sitting under a tree in the rain and it gets soaked through and you start getting wet, finding another tree won’t help you.
The whole industry is adjusting to the reality that the expected output of an engineer is much higher than it used to be. It’s not local to one company. You may find a better environment for the time being, but this is the direction everything is headed.
Maybe once we get universal income we can start recommending this. Until then the individual isn't to blame when the only option to keep providing is to keep grinding in a toxic environment.
But I'd agree that everyone can start planning a career shift that'll span a few months to some years in order to seek better working conditions. Passively accepting all work degradation because that's life and money is needed is partly responsible for the current situation too.
This, I happily used the opus 4.6 fast mode to the tune of 5k for a project. The delivery of the project justified the 5k, if I only spent 500 but delivered the project 1 month later - I would have been in the dog house.
Your project cost $5k in tokens? How does that work? over what time? My understanding is that most developers are given pro max plans at $200/m and are expected to max that out.
I've been getting by on the $200/year plan by smoothing usage continuously over time.
The pay per use is for the API so does it mean you're using the API in a custom setup?
My real comment is, why were they not just using their self-hosted copies of it? Do they pay back Anthropic for use of it in Azure? Broker a deal, let Anthropic charge you drastically less to use their model AND Anthropic could have made Claude Code work directly with Azure for Microsoft employees. Pennies on the dollar, and Microsoft could do it using low use GPUs to save on cost, or stack underused GPU compute (this is how serverless was born btw - its the unused resources in a web server somewhere).
When you consider that xAI's old data center was enough to bring Anthropic back ahead, it tells me Microsoft could host their own on underutilized previous gen GPUs that are sitting there wasting server real estate.
> The comments I see recommending selective use of cheaper models doesn't match the reality I experience working in the industry. I have the constant threat hanging over my head of being fired if I don't churn out code quickly enough. I'm not willing to gamble with my livelyhood by using a less effective model.
I don't buy it. Old models such as GPT4.1 were faster than newer reasoning models, and their output was as good. Newer models end up wasting an ungodly amount of time with chain-of-thought steps which can be a complete waste of time if you have a structured prompt such as a plan or a spec.
My experience in the real world is that users have to ration requests, and x0 models actually tend to be used far more because expensive models are left for more complex tasks.
This, if you’re high performing, the company won’t question your use of tokens. If they want to limit it, they have ways to set limits on spend and usage.
Wouldn't they be forced into API pricing instead of per-seat like that though? That would potentially be a massive cost increase. But I've discovered through talking to colleagues some companies are already doing that. I can't understand why you'd ever do that when you can get VC subsidized pricing for now. At least for all initial in-plan usage. I doubt many developers go past the limit anyway and for those you switch just the extra usage to on demand anyway.
> The developers voted with their feet and didn’t use Copilot.
This was true in January -- since then, the Copilot CLI team has spent countless hours with engineering leaders and the biggest Claude Code users at the company to understand Copilot's shortcomings, define evals to properly test them head-to-head, and close the gap between the products.
The result? Claude Code usage was organically decreasing and Copilot CLI usage was organically increasing -- when this announcement was made, internal Copilot CLI usage had been greater than Claude Code usage for weeks!
Most of us never had the option for work to pay for Claude Code -- some internal orgs did this. That being said I had a personal Claude Code subscription for a bit.
Honestly I find GitHub Copilot CLI (and now also the new GitHub Copilot app) quite decent. I mostly use it with Opus 4.7, or rarely with GPT-5.5. The VSCode extension is ok, but CLI or app are the better experience IMO.
I'm with you there. I can't stand the CLI that wants to take you away from the mostly bad code it writes. Give me the structure, let me finesse it - to do that I need to actually see it no matter how much Anthropic pretends that it's perfect.
Slightly related (me not understanding) is why the Copilot in VS code is essentially just CLI interface. Why can't it use the IDE tools (search, LSP, ...). All it ever does is trying to execute grep.
Same, with regard to TUIs in general. The VS code copilot chat extension has really nice integration for 'human in the loop' style agentic development. I build some tooling - https://www.agentkanban.io to integrate a taskboard and git worktrees with copilot chat
Claude Code will write the whole thing for you. Whereas doesn’t Copilot require input along the way of coding? ie- it doesn’t do all the programming for you
I'm a little the opposite, what's the point of using an IDE with AI? I genuinely don't get it?
These days I just use Claude Code Desktop or Claude Code in powershell. Standalone, not inside and IDE. Honestly, I'm using Desktop more and more as it gets more features.
The IDE is for me. No AI in it at all. If I want to get Claude to do something specific to a file I just @ the file.
Microsoft have historically tended to dogfood their own products.
Obviously you want to be aware of what else is on the market, and use the right tool for the job -- but equally if you have a directly competing product, you'd prefer your org's telemetry and suggestions are directed towards improving your own software rather than your competitors'.
This was always a little weird to be because Microsoft internally is actively hostile to cross-org collaboration. If you worked in most of Azure you basically have 0 lanes of communication with someone from the Windows team and vice versa. Triply so for stuff like Kusto or Teams which you'd be dogfooding daily. I guess if there's a horrible stop the world bug it'd get surfaced through telemetry but normal user feedback is not a thing.
Compared to working at other big techs, where I was able to direct msg the engineers on the team for internal protobuf or datalake services in addition to user groups that were generally responsive it was just strange. Also Microsoft doesn't have a monorepo so you can't just commit patches to their service because you don't have access to their repos which I pretty regularly do elsewhere.
Maybe it's just Microsoft moving to more model agnostic tech within their copilot. I recently started using Microsoft 365 Copilot because corporate added Cowork which runs on Opus 4.7 which was better than the alternative we have available. Unlike the "real" Claude Code or Cowork this only has access to files in a specific onedrive folder in your personal sharepoint container, so it's much more compliant to things like NIS2.
Technically we're using Copilot and we're playing for it through Microsoft licenses, but it's using Opus 4.7. Even before this, most of our custom agents within m365 copilot were one of the GPT models.
Or maybe you're right and they want their developers to use the copilot models.
I never understand why Amazon even bothers to build their own coding agent.
GitHub Copilot is in a somewhat similar place as Microsoft's toy but still different -- it was more or less the first coding agent/assistant, and GitHub/VSCode/Microsoft has enough user base and impact to influence individual users and enterprises' choices.
For Amazon's coding agent -- I just never see anyone outside Amazon even mentions Kiro or Amazon Q. Maybe a little bit when Kiro was offering tons of free credits. But I don't think it's even remotely relevant these days. I don't see news about companies adopting Kiro.
To me, it's just a matter of time before they are sunset, like Chime or a bunch of AWS products.
There's definitely a way to use Claude code that is token conscious.
I've tried throwing unsupervised agentic software factory workflows against the wall, and they burned through my tokens like nobody's business but didn't produce much.
Supervised, human-in-the-loop process on the other hand is much more productive but doesn't consume nearly as much. Maybe that's why everyone's pushing agentic approaches so much.
The current thinking is automated agents is what turns this from an industry in the tens of billions to a multi trillion dollar one. So yes you are right on the money, agents stimulate demand for this thing they've built.
Yeah. Claude does good work but reviewing it all properly takes quite a bit of time. It got to the point I started having trouble maxing out my weekly allocation.
Dealt with that by going all out and making an agentic parallel code review skill. Basically an infinite TODO list generator. Now I'm definitely getting 100% of the usage I paid for. It really burns tokens like nobody's business, and catches a lot of issues while at it. I've been looping this review/fix process every week. It's dramatically reduced the amount of stuff I need to pay attention to during my human review sessions.
I really don't like how the payment plans work with the providers right now. I feel this pressure to use all my tokens for the week, often just "wasting" them. But also, I want to take advantaged of the subsidized tokens in Claude Code and Codex for as long as I can.
There is this real danger that our thinking, and the things we make, become bloated without constraints.
IMO software has gone to shit since both mobile phones and laptops mostly have massive amounts of compute. We always seem to use it to the limit, just because it's there.
I’m interested in how this works in practise - I guess you’ve written a skill to do code review, then your Claude.md file tells it to use it after every change as a bg task? So does this work as a background task while Claude is working on the next ‘feature’?
I think it's great. People at a broad scale are getting first hand experience with resource management. It's a fairly cheap way of doing it too (in contrast to: learning this by managing humans) and we can all benefit from the skill transfer.
I find myself observing how my lead manages meetings ... "ah, this is like when I do that with Claude", "this is where he wants to understand what happened, like when I ask Claude" ... it's funny.
At the enterprise level though, its going to be hard to want to use a service in which costs are not predictable, and keeping those costs under control requires employee training.
You can put a limit on token spend and provide training (and even pre-configured workflows) on how to limit token spend.
Like the other commenter said: cloud spend can also spin out of control if you don't pay attention, yet we've found ways to keep it under control (training, guardrails, limits, transparancy).
To be fair, the cost of software development has always been fairly unpredictable. What may be different is that the cost used to be roughly proportional to man-hours spent, while now the number of agents running in parallel may be less predictable.
> There's definitely a way to use Claude code that is token conscious.
Colleague used Sonnet 4.6 on some pretty normal agentic coding tasks through AWS Bedrock to keep the data in the EU, 100 EUR usage in a single day. In comparison, the Mistral subscription costs about 20 EUR per month and we tested that for similar tasks it was okay, the usage got to around 10% of that monthly limit in a single day. Or Anthropic's own Max (5x) plan where you get way, way more tokens to do with as you please.
I feel like the sweet spot is having a monthly subscription with any of the providers (you're subsidized a bunch), but if you have to pay per tokens, now I'd just look in the direction of what tasks DeepSeek would be okay for, sadly probably not in the situation above. For a startup, though...
On the other hand, this feels a bit hypocritical:
> It was part of an effort to get project managers, designers, and other employees to experiment with coding for the first time, and sources tell me that Claude Code has proved very popular inside Microsoft over the past six months.
They're gonna say that the future is all AI... until they get the bill.
I was a Mistral Le Chat Pro subscriber (the €20/month plan). Yesterday I hit my monthly limit. Switching to PAYG I burned through another €40 in one evening, working on the same project, with the same tasks.
I upgraded my plan last night to Mistral Le Chat Teams. This now costs me €60 per month for two users. Limits have been reset, but I have no idea now if my per seat limit is higher than the Pro plan, or if the limit is shared between the seats, it’s really not clear. I guess I will find out next month. The limits reset on the first of the month and I really hope I don’t hit them in the next seven days.
I use Mistral Vibe CLI and I’ve written and implemented a couple of new skills[1]. Caveman, based on an idea I found online somewhere, this skill removes all extraneous response text, including articles. Makes for some fun reading, but supposedly reduces output tokens significantly. Hash-anchors, this one is based on a concept from Dirac[2], reduces search failures and also includes multi-file dispatch. It will be hard to measure, but Vibe tells me these two should result in roughly a 40% reduction in token burn.
I was trying to get a better sense of the time cost quality matrix of these, so I threw together a quick eval of Sonnet 4.6, Mistral's dev model, and Opus 4.7 (figuring it's what you'd use if you were on Max).
The results for a function implementation and test of levenshtein distance in js are pretty similar but Mistral is 30x cheaper than Opus 4.7 and 4x faster than Sonnet 4.6.
My experience as well... I've only hit Antrhopic's 5hr threshold a few times, and two of them was within a half hour of the window. Also, all three times I'd already accomplished a LOT.
I tend to work with the agent, and observe what's going on as well as review/test and work through results/changes. I spend a lot more time planning tasks/features than the execution, even using the agent as part of planning and pre-documentation. It works really well. I don't think people burning through the 5hr allotment in under an hour are actually reviewing/QC/QA the results of what they're doing in any meaningful way, and likely producing as much garbage as good (slop).
I'm really curious as to HOW the MS employees were using the agents as much as what they were doing.
I suspect subscription limits are quite a bit higher than the equivalent tokens their dollar cost could purchase. I similarly feel like I can get a lot done with a $20/mo Claude Pro subscriptions, but also can easily spend $10-20/day at API pricing with similar usage.
98.6% cache hits doesn't distinguish an efficient workflow from an overly chatty linear agent repeatedly reusing the same context. Plus, it says nothing directly that the process has good useful progress per token.
You pay for cache hits on every turn and even with the newest architectures longer context is slower/more energy intensive. Constructing concise turns that reuse prefix and stop when the new context is no longer useful help, as does pushing generation down into cheaper models while using stronger models for verification.
> I understand that Microsoft is planning to remove most of its Claude Code licenses and push many of its developers to use Copilot CLI instead. While Claude Code has been a popular addition, it has also undermined Microsoft’s new GitHub Copilot CLI coding tool — a command line version of GitHub Copilot that runs outside of development apps like Visual Studio Code.
It's a forum called Hacker News that's been hacked and covertly refactored into Marketing Wars. Being their primary goal is to foster a space to draw-in (marketing) projects/start-ups.
I've launched an internal demo of Claude Code and Deepseek on the same day and we burned through our monthly allowance for Claude in just over a week, with more than a half of that budget being spent in one day. With DS people are unable to go through that same amount of money in a month, not even close.
With that Claude feels like an expensive toy, while DS is a shovel, purely because developers do not feel like they are eating into a precious resource while using it. Also it does not feel like there is much of a difference in capability between Claude and DS-pro. DS-pro and flash do feel like sonnet/opus and haiku, but flash is still very-very capable.
After 2 weeks of Claude getting progressively worse and worse, today was the final straw.
I don't care if they have a phone app. The model is COMPLETE garbage after you subscribe long enough and they think they've "got you".
I can't code on my phone if the model literally moves in the wrong direction and does the opposite of what I tell it to. If I wanted to make my code worse, I'd just randomly commit garbage. I don't need a mobile app for that.
I've seen a lot of this sentiment over the previous six months from people on reddit. I have yet to experience this myself as a developer with over 20 years of experience.
Gemini got a big reduction in usage limits this week. There was backlash and they added 3x usage for Antigravity a day later but I haven't really tried it out to get a feel for it yet.
Google rug pulled Code Assist and Gemini CLI. They're moving everything to Antigravity and we would need to reinstall all our tooling, reconfigure any automations, and the mechanism to subscribe via GCP is much clunkier.
This was all supposed to be worked out prior to Cloud Next, but it wasn't. Ironically, they mentioned Claude in a few of their presentations at next.
And that was our solution. We are a big GCP customer but our whole team is on Claude now and much happier.
It seems like new Holy Wars will rage between those who can afford models like the Opus 4.7 or GPT 5.5 Pro, which in my opinion are unlikely to have been used for anything serious, as they're simply several times more expensive than any human effort. There's a speed advantage (still questionable), and quality isn't guaranteed, but the price completely kills everything. And between those who actually write the code and calculate the development costs. I won't talk about large corporations that can afford it, much less those who develop models. "Mere mortals" simply don't have such opportunities. 17 GoLang microservices for a serious project were written perfectly using the latest version of QWEN. The only areas where we really had to work hard were documentation and a very serious task breakdown. All of this was tested, and yes, a review was required, but everything was within reason. The deadline was 10 days of 24/7 work, including the review. When attempting to submit the same task, Opus 4.7/4.6 had to be stopped after three hours. If you have significant resources for experimentation, you can certainly try. For us, the choice is absolutely clear at this point.
My experience is, Claude Code burns way more tokens compared to other agents, probably to ensure high levels of perceived quality, which is, most of the times not worth the bloat for the user. The bloat works for Anthropic as an advertisement at the cost of your tokens.
its kind of weird tho, jensen also said we should be burning tons of tokens as well... 'perceived quality' cant be the only reason these ceos pushing token usage so hard can it?
1. right now, usage correlates with experimentation and learning, few if anyone knows how to make these things effective on their own over long sessions of activity
2. long term, you should be using more than one agent at a time, because they are running in the background based on events (new direct message / something happened in eg. github)
Thus does kind of beg the question: If developers are being laid off because AI is better/faster/cheaper or makes all their people 10x or whatever fig leaf, what happens if the required tooling ends up being more expensive? From the investor’s point of view is the drag of employee costs better or worse than a ballooning expense item?
> If developers are being laid off because AI is better/faster/cheaper
This is, in my opinion, tripe. SWEs are being laid off because of post-Covid over-hiring. The only evidence for labour destruction is in junior hires. But not because anyone is being fired, but because entry-level jobs are being cannibalised.
In general economy that is not the stock market is looking less and less great. Answer to this is to tighten the belt and that means losing employees. Especially as there has not been any new great revenue sources outside AI in recent years.
I suppose if it all works out it'll end up way more expensive than the employees the models displaced ever were. These kinds of technologies usually end up as an oligopoly at best, and those players will have a wide moat by then, and the things these models build will be tweaked such that no other model or human being can realistically work on them anymore, and then they can price gouge everyone to the brink of unprofitability.
I suspect AI would have to get drastically more expensive before it starts looking worse than payroll. If one developer using Claude Code can effectively substitute for 2 developers, you are already coming out ahead at current API pricing assuming very heavy usage, your cost is going to be ~1.5x developer (factoring in beyond salary - benefits, PTO, the other overhead that comes with having employees).
So you're getting 2 for the price of 1.5. Scale that up to 500 devs at a big company and it's a big chunk of change saved on payroll.
Keeping your headcount or hiring humans instead, AI would have to start to cost upwards of $15k/month/developer or more before it costs more than hiring. You're looking at about 4 billion tokens per month before humans start to break even or are cheaper.
More expensive is a difficult calculation: faster can sometimes warrant the higher cost, if it means you can go faster to market. Also, LLMs work 24x7, and can be scaled up and down as needed. Faster to off board an LLM than to fire an employee (especially here in Europe). So, even if AI is more expensive than a developer, from TCO and ROI perspective it can still make business sense.
"AI" is just a cover for laying ppl off and saving cost. But the pendulum will swing the the other way and the companies will realise that knowledgeable ppl are still required to generate and utilize the generated code. No serious company can run with vibe-coded apps generated by laymen.
There is no profit, expense, revenue. Those don't matter. Only thing that matters is stock price goes up, and laying off makes stock price go up. When laying off make stock price go down, then laying off stop.
I switched from Anthropic to OpenAI after spending ~$40K in equivalent token costs using Claude over 3 months.
I found Opus 4.7 to be slow and wasteful with token usage. It's shocking how inefficient it is with tasks like bash tool usage and web searching, delegating them to a dozen subagents only to get stuck and never return until you esc and intervene. That, in addition to all of the broken tooling Anthropic built in to limit token usage like the broken monitoring tool made managing Claude a chore. I was happy to pay $200/month for Opus 4.5 when they had more capacity, but 4.7 felt like a huge step back and no longer worth the price and inconvenience.
I remember an OpenAI employee comment on the GPT5.5 release post about how they specifically geared it towards long-horizon tasks and its been a breathe of fresh air in that regard. I have five two-week long sessions going right now and there's been no degradation in performance or efficiency. It's much better at carrying rules/learnings forward even in long-running sessions and grounding/refreshing itself in verified facts when it loses context.
Its funny because in two weeks I've gotten way more done with GPT5.5 with way fewer tokens and way less handholding. I think this goes to show how important tooling and the harness is and how a capable model like Opus 4.7 can be severely handicapped by bad product decisions.
Being able to mange context over long running sessions is a function of the harness, not the model. Are you using Claude Code with GPT5.5? Codex? piclaw? They’ll all have different context management strategies to let you keep going when you would otherwise have filled up context and be forced to stop.
It doesn’t matter how good the harness is if the model does a bad job of planning and continuing from long context. A good harness cannot overcome a weak model.
> It was part of an effort to get project managers, designers, and other employees to experiment with coding for the first time.
I suspect they weren't as efficient as they could be with token use either. Sounds like they were trying to encourage non-developers to vibe code stuff
I'd argue you have a lot more to worry about with developers as far as token usage goes because they're the ones who know how to rig up these wild workflows where tens of agents simulate an entire software development team. The non-developers are probably going to be sticking more in the realm of iterating via chat.
Our shop is forced to use Copilot on gov cloud, and it’s so useless I usually stick to manually coding. Its syntax is messy, it randomly combines lines together, flips order, or drops a couple tokens worth of output in the middle of a line, and for some reason it consistently drops the last line of every code block. I assume we’re getting a few versions back of GPT under the hood. But it does make me appreciate how the models of the past year or so crossed the threshold from interesting to truly productivity-enhancing.
Between Copilot, Claude, and Gemini, I still actually prefer Gemini. I do a lot of scientific writing in addition to coding and Gemini is the only model I can trust to “just be right”. This trust then transfers over to its code output.
If you are talking about the Copilot built into vs code, that's not been my recent experience at all. Very capable in agent mode since gpt 5.4 came out.
I’ve been quite content with CoPilot’s $10/mo plan. Still offers access to Claude models (limited tokens) but has no time limits like the $20 Claude plan, so no interruptions in work flow. I use one of the free models for the more pedestrian tasks then sic Claude on the particularly thorny problems. Works very well for me.
Copilot cannot be behind any models because it's a harness, not a model. You can use any of the popular models through it, including Claude models. Though people have been saying that Claude CLI is a better experience.
I'm surprised they even had them in a first place. Doesn't Microsoft have a deep partnership with OpenAI? Aren't all Copilot things powered by various GPT models? I would assume the two companies have barter agreements of sorts.
Lots of these places measure employee token use with managers having dashboards. It seems like performative code production rather than making anything useful.
I think so too, otherwise why wouldn't you put that (purported) increased capacity/output into improving your existing products or creating new ones, with the headcount that you already have?
That's what we've spent the last five months doing! Have you tried the Copilot CLI recently? We've onboarded loads of feedback from Microsoft devs who were switching from Claude Code -- I'm proud of how far the team has come!
This announcement comes at a time where Copilot CLI usage has been greater than Claude Code usage at Microsoft for several weeks; we've been winning hearts and minds!
I think whats funny is that employees were most likely already covering the cost for these tools because they are useful. Companies didn't believe employees were using these tools and now have forced their usage and no longer have the costs subsidized.
Similarly companies seem to reward high token usage as a sign of someone willing to play ball with AI and again have forced higher costs on themselves for people reward hacking or using tokens out of spite.
There is no world where I can put my company’s data through an external site without their express consent and security sign off. I suspect at most companies there’s zero path for people to have been paying for it themselves.
"incentivize to use as many tokens as possible" = "Upper management knows people dont like change so we are forcing them to come up with ways to use this thing". It does not mean that management will encourage wastefulness in the future, and it also doesnt mean that token usage from now wont be reviewed in the future. Whats to stop them from dinging your performance in november because you wasted a hundred thousand on tokens with nothing to show for it?
Makes sense why Anthropic wants to IPO as soon as possible as the growth right now comes from temporary wastefulness. Makes all the investments more risky.
If you properly keep documents, architecture, and decision records, token consumption can be pretty less. Iam managing everything with two codex plus sub. Repo size is 300 k loc ( backend).
I switched to OpenRouter and OpenCode a while ago. It is much cheaper, much much cheaper, and A LOT more reliable. Particulary Gemini was a piece of trash when it came to uptime
I switched from Claude code to the GitHub copilot app recently. Since our repositories are hosted on GitHub I find the copilot app better integrated for the PR workflow with PR management available in the app. I don’t think I miss any of the features of Claude code I never thought I would make the switch but copilot upped the game.
Also it became very hard to convince management to keep both Claude code and GitHub Copilot enterprise licenses.
Dogfooding only works if it actually helps improve the product. zune never improved. Dogfooding without improving is just eating dog food for no good reason.
Surely a company as large as Microsoft is actively attempting to build their own models. They couldn't possibly have expected to stake the future of their software development on the conditions of a third party company?
Okay, but what if you're not Microsofts size and don't have and R&D budget large enough to fund development of your own models and tools?
This is a warning to any company, not building their own AI, that AI assisted development could become really expensive really fast and most likely won't pay off. What Microsoft is suggesting is that the current price is to high, but it's still not high enough for e.g. Anthropic to be profitable, or AI coding tools are only as good as the developers using them. So you can't meaningfully do layoffs by replacing the developers with AIs, because the cost is to high.
How does Microsoft plan to fix CoPilot, so that the cost will be so much lower than Claude, that budget overruns won't be a problem for their own customer?
I expect in the next year or so, we'll stop seeing headlines like "Anthropic buys $15b of compute from SpaceX" and we'll start seeing headlines like "Uber's AI department licenses GPT 6.2 as the foundation for their internal model," or something like that.
Smaller companies will have departments that distill larger models into something more specifically manageable and useful for them. At least, that's my personal prediction :)
The frontier model space costs 1000x as much to develop as the small language models, and is only 1.5 years ahead.
Factually, the frontier models have not paid for themselves. So, if you're MSFT and Apple, you don't need to run in a race where even the winner loses massively.
You can try to train models 1.5 years behind that are highly likely to be profitable, given your market position.
The average person is lagging behind what AI is capable of by 3+ years anyway...
So you can save 1000x on training and 10x on inference and just use SOTA small models.
Why spend $5B training a model that's for sure not going to make $5B (after inference costs) when you can spend $5M building one that WILL make far more than that after inference costs?
At one point there were rumours that they'd do that. They also have the rigts to oAI models for a few more years still, so they could always use that but apparently they're also compute starved (like anyone else).
MSFT does have a frontier AI Lab. My friend works there. I don’t know what they’re doing. But MSFT is one of like 5 entities that actually have the talent and physical infrastructure to compete in model-building.
The way coding agent work is fantastically wasteful. All the megabytes of code are processed over and over and over, sometimes withing just one session.
There are papers describing KV cache precomputation for commonly used documents (e.g. KVLink), but, of course, it's not a priority for model providers: they'd rather sell you more tokens, also they would rather get to AGI/ASI first than optimize usage of existing models...
I meant caching on a bigger level. If you're an organization with 100 developers each doing 10 sessions a day, you're paying for 10000x tokens in frequently used document even if you had 100% KV cache hits within one session. Apparently that's too costly even for companies with trillion dollar market cap...
Normally KV cache works only if your context prefix is identical, but there are papers which demonstrate documents can be cached between different contexts.
I believe OP is talking about new sessions or after compaction. He’s getting at the fact that LLMs are stateless and have to rediscover your codebase on every new session.
What's the point of eating your own dog food when the only thing you are doing is reselling other people's dog food? Microsoft don't have any competing LLM.
I have noticed particularly in recent weeks and maybe couple of months that token costs are just ridiculous.
I can understand the upcoming IPOs and instinctive pressure to show profits ... but let's be honest, showcasing burning 1.3 million USD in tokens by a single developer in a month is the most ridiculous thing I have seen in my entire life.
The general principles still apply. You expect investing X and have a return on such investment.
Unfortunately that's not so easy to promise or expect.
There's no real 1 to 1 correlation between amount of code written and returns, and even less between tokens burned and returns.
I start to believe that the current token pricing approach, followed at the moment by all leading labs (especially considering OS models capabilities), is bordeline delusional ...
It seems that people are using LLMs to generate code but many complain of sub par code. I recall the early days of virtualization when folks will use it but complain about performance. HW capacity continued to improve until virtualization became de facto standard. I wonder if sub par code will become better as more powerful agents models or compute become available.
What per cent of internal Microsoft IP runs through Anthropic? Do they not care about trade secrets, or certain groups allowed or not allowed to use tools that expose IP to external vendors?
It's been said that technologies are not product. CC might be better, but at the end of the day M$ is going to want to cut costs and have employees use their own technology. Perhaps Copilot CLI is close enough, and the CC product doesn't justify the cost of the Claude (technology) license when M$ has their own technology to leverage.
Side note, it's so frustrating that The Verge puts a paywall at the fold. It makes me feel like the rest of the story is not worth reading. I'm not inclined to pay $2 to read a link that was posted on an aggregator.
2nd link doesn't work.
That would be a neat tool, to find the original article and see how many levels of AI summary it has gone through, a game of AI telephone!
I had thought about creating something like that for finding comments for articles. For a given article, display links to comments for HN, lobsters, reddit, etc. However, I feel I already waste too much time reading comments. I shouldn't make it easier and more tempting.
Man, maybe it's time for me to give the verge a subscription. There the only ones actually doing any journalism here and a bunch of AI blogs skimming off the top.
Microsoft poorly manages token use of most expensive models in a pilot. Then they use that failure to advertise/position their own Github Copilot agents to procurement teams, over the now widely validated Claude Code-based agents.
At least Codex is trying to win validation on merit.
The comments I see recommending selective use of cheaper models doesn't match the reality I experience working in the industry. I have the constant threat hanging over my head of being fired if I don't churn out code quickly enough. I'm not willing to gamble with my livelyhood by using a less effective model.
Saving money on tokens isn't something that's rewarded during performance reviews; particularly because it's difficult to quantify how much you saved versus hypothetically using a more expensive model.
I think quantifying tokens used is analogous to quantifying the amount of sawdust generated on a construction site.
Churning out useful code quickly is not solved by using more tokens per unit time. Most non-technical leaders can grasp this one and are likely more interested in the strategic game theoretical dynamics that are being forced by way of implied token consumption expectations (competition between developers).
If you want to hold out as long as possible and don't really care about anything other than the compensation package, you should at least play along with this new game in a half-assed manner. Try to goldilocks your token usage between any established extremes. You want to be in the statistical barycenter of every AI report that management can create.
To understand the token count thing - spending tokens is necessary and not sufficient to demonstrate that you are adopting AI.
Where we were 6mo ago is that a lot of big orgs realized they were behind, and needed some way of measuring if the tools were usable at all.
No sawdust at all on your job site, and you can tell nobody is cutting wood.
Now that tooling is more mature, you can measure things like % of diffs AI-generated, % of AI suggestions accepted vs edited, % of KB queries successful etc - all more useful than raw token count for quantifying how your org is using the tool.
So it’s a pragmatic metric that got a bit Goodhearted.
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That sawdust analogy is fantastic!
We may be on the cusp of the AI age's new era of 'measure twice, cut once'.
Suddenly, LoC returned
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> I have the constant threat hanging over my head of being fired if I don't churn out code quickly enough.
And the tragedy is that this isn't sustainable, and we all involved deeply in tech know this. There is eventually going to be a big reality check the companies will have to pay, because you can't force creativity and quality, not even with AI, because actual intelligence lies with us at least for now and for the foreseeable future. However when the rope eventually snaps these executives at best will fall upwards, with big severance bonuses and a list of "contributions" we have to be grateful for. We are the ones that will suffer through the next big layoffs.
Unfortunately, I think this is correct. Such as it ever has been with technological change. The folks at the bottom bear the brunt of the dislocation and the folks at the top pat themselves on the back for being so forward looking and get huge payouts regardless of the actual results. Further, the folks at the top are always incentivized to go along with the herd of their peers because if it works then they were on the bandwagon, and if it doesn’t work, well then, how could they have known because “Everyone was deceived.”
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Most companies do not care about quality. _users_ who have to interact with that software will pay the price.
Exemple from one of the wealthiest company in existance, for one of its most strategic product: I was trying gemini-cli on some mcp servers just yesterday, with gemini-chat helping me configuring everything. In less than 10 minutes, I stumbled upon 3 or 4 different bugs. Eventually, even gemini-chat recommended that I throw gemini-cli in the bin and move on to another agent... That's the new norm.
How much creativity do you need to fix bugs in corporate code? Almost zero. It’s maintenance, not creative work. Nothing against it, it’s needed, but let’s be real, would anybody be really sad if this work is overtaken by LLMs? I certainly won’t be, let them do it.
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Anyone (including ANTHROP\C) "recommending selective use of cheaper models" is spending costly human time (which costs more over time) on correcting the machine (which costs less over time). This is a bad trade.
In cost per line of code, we have verified this is always an error unless your time is worth less than the machine (unlikely unless you consider your time to have no cost rather than considering it as your hourly rate).
The worst thing for our productivity has been Claude Code or Claude Cowork taking a complex problem and turning around and writing bad instructions for dumb model agents then synthesizing the dumb answers into an orchestra of badness.
The single best fix for results-per-total-cost is to ensure it reads and thinks about whole content, not snippets, and thinks with the smartest model, not agents.
Agents should toil. Agents should neither think*, nor decide what to think about which itself is thinking.
* Agents should “think” like ants or bees or beavers think. Any human-like thinking, *especially* intuition-like thinking, should be thought by the best model available.
** Nobody should be “churning out code”. In a hierarchy of coders who translate detailed specs to some computer language, developers who write software that ships on a project timeline, and engineers who accomplish business goals, engineers should “churn out” engines structured for business outcomes.
Measured by that, the machine is leverage while reducing a variety of costs. At the same time, because most training data doesn't grok this, the machine doesn't grok it either. So it needs you to shape its toil.
I disagree heartily with everything here, both in personal experience from the models, and in values about coding.
I don't care bout cost, I care about getting good results fast.
Cost per line of code is not a suitable metric for anything. It's as silly as measuring engineers' performance by lines of code. More lines of code is worse than fewer lines of code. When you say "we have verified" whoever that "we" is makes a big difference, but you're posting pseudonymously, how are we to even guess at that "we"?
I get better results with some older cheaper models, faster. In particular older Claude models than Opus 4.7. Maybe the more expensive model churns out more lines, more complexity faster. That is a worse outcome for me. The complexity must be avoided at all costs. The simpler, smaller, answer is always better, and scales to bigger code bases. The more the model guesses at intent rather than checking intent, the more the model is clever rather than clear and simple, the worse the outcome, the more that the model turns into an architecture astronaut, the worse the outcome.
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Too many people see wages as a sunk cost and a constant. One problem though is AI costs per task are unpredictable, and management tends to prefer predictable outcomes over optimal outcomes.
> The single best fix for results-per-total-cost is to ensure it reads and thinks about whole content, not snippets, and thinks with the smartest model, not agents.
I haven't seen "just absorb a giant ball of context and do the right thing the first time" be cracked yet, even for Opus 4.7.
At the end of the day, code is code, and we have decades of lessons about how to make code more reliable and maintainable. Composable small modules, not god methods, are still the way to go, and they reward devs who use them to get focused context for agents with faster - and often better - results.
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If you have such toxic environment, run.
If you’re sitting under a tree in the rain and it gets soaked through and you start getting wet, finding another tree won’t help you.
The whole industry is adjusting to the reality that the expected output of an engineer is much higher than it used to be. It’s not local to one company. You may find a better environment for the time being, but this is the direction everything is headed.
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Maybe once we get universal income we can start recommending this. Until then the individual isn't to blame when the only option to keep providing is to keep grinding in a toxic environment.
But I'd agree that everyone can start planning a career shift that'll span a few months to some years in order to seek better working conditions. Passively accepting all work degradation because that's life and money is needed is partly responsible for the current situation too.
Where to, that's the question. The economy is in the gutters and the replace-people-with-AI craze is making the issue even worse.
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> I don't churn out code quickly enough
Curious what industry that is.
This, I happily used the opus 4.6 fast mode to the tune of 5k for a project. The delivery of the project justified the 5k, if I only spent 500 but delivered the project 1 month later - I would have been in the dog house.
Your project cost $5k in tokens? How does that work? over what time? My understanding is that most developers are given pro max plans at $200/m and are expected to max that out.
I've been getting by on the $200/year plan by smoothing usage continuously over time.
The pay per use is for the API so does it mean you're using the API in a custom setup?
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My real comment is, why were they not just using their self-hosted copies of it? Do they pay back Anthropic for use of it in Azure? Broker a deal, let Anthropic charge you drastically less to use their model AND Anthropic could have made Claude Code work directly with Azure for Microsoft employees. Pennies on the dollar, and Microsoft could do it using low use GPUs to save on cost, or stack underused GPU compute (this is how serverless was born btw - its the unused resources in a web server somewhere).
When you consider that xAI's old data center was enough to bring Anthropic back ahead, it tells me Microsoft could host their own on underutilized previous gen GPUs that are sitting there wasting server real estate.
> The comments I see recommending selective use of cheaper models doesn't match the reality I experience working in the industry. I have the constant threat hanging over my head of being fired if I don't churn out code quickly enough. I'm not willing to gamble with my livelyhood by using a less effective model.
I don't buy it. Old models such as GPT4.1 were faster than newer reasoning models, and their output was as good. Newer models end up wasting an ungodly amount of time with chain-of-thought steps which can be a complete waste of time if you have a structured prompt such as a plan or a spec.
My experience in the real world is that users have to ration requests, and x0 models actually tend to be used far more because expensive models are left for more complex tasks.
Are you saying you found GPT 5.5 to be as good as 4.1 for coding?
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This, if you’re high performing, the company won’t question your use of tokens. If they want to limit it, they have ways to set limits on spend and usage.
From reading the article. They offered their developers both Claude code and Copilot.
What they wanted was for them to use both and feedback which was better.
The developers voted with their feet and didn’t use Copilot.
What Microsoft were hoping was that the opposite would happen...
For months, Employees had the option to choose claude code or copilot. Now they dont.
Underlying model choice still has no restrictions. Opus 4.6 is by far the most popular. there's still big $$$ bills going anthropic's way.
Curious if anyone around here stayed on 4.6 (having a choice to use 4.7)
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Wouldn't they be forced into API pricing instead of per-seat like that though? That would potentially be a massive cost increase. But I've discovered through talking to colleagues some companies are already doing that. I can't understand why you'd ever do that when you can get VC subsidized pricing for now. At least for all initial in-plan usage. I doubt many developers go past the limit anyway and for those you switch just the extra usage to on demand anyway.
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I use copilot cli and I can pick Anthropic models. The Microsoft interface seems fine to me, and equivalent. Not sure what the big deal is.
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> The developers voted with their feet and didn’t use Copilot.
This was true in January -- since then, the Copilot CLI team has spent countless hours with engineering leaders and the biggest Claude Code users at the company to understand Copilot's shortcomings, define evals to properly test them head-to-head, and close the gap between the products.
The result? Claude Code usage was organically decreasing and Copilot CLI usage was organically increasing -- when this announcement was made, internal Copilot CLI usage had been greater than Claude Code usage for weeks!
Most of us never had the option for work to pay for Claude Code -- some internal orgs did this. That being said I had a personal Claude Code subscription for a bit.
Honestly I find GitHub Copilot CLI (and now also the new GitHub Copilot app) quite decent. I mostly use it with Opus 4.7, or rarely with GPT-5.5. The VSCode extension is ok, but CLI or app are the better experience IMO.
Do people bring their own then (considering work doesn’t pay for it)?
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I wish I could understand the appeal of using Claude Code inside VScode rather than Copilot. I feel like I'm missing something obvious.
I'm with you there. I can't stand the CLI that wants to take you away from the mostly bad code it writes. Give me the structure, let me finesse it - to do that I need to actually see it no matter how much Anthropic pretends that it's perfect.
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Slightly related (me not understanding) is why the Copilot in VS code is essentially just CLI interface. Why can't it use the IDE tools (search, LSP, ...). All it ever does is trying to execute grep.
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> I wish I could understand the appeal of using Claude Code inside VScode rather than Copilot
MS thinks CoPilot is the Clark Griswold of LLMs when it's really Cousin Eddie...
Same, with regard to TUIs in general. The VS code copilot chat extension has really nice integration for 'human in the loop' style agentic development. I build some tooling - https://www.agentkanban.io to integrate a taskboard and git worktrees with copilot chat
Claude Code will write the whole thing for you. Whereas doesn’t Copilot require input along the way of coding? ie- it doesn’t do all the programming for you
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I think they were comparing CLIs, not VS extensions.
I'm a little the opposite, what's the point of using an IDE with AI? I genuinely don't get it?
These days I just use Claude Code Desktop or Claude Code in powershell. Standalone, not inside and IDE. Honestly, I'm using Desktop more and more as it gets more features.
The IDE is for me. No AI in it at all. If I want to get Claude to do something specific to a file I just @ the file.
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Microsoft have historically tended to dogfood their own products.
Obviously you want to be aware of what else is on the market, and use the right tool for the job -- but equally if you have a directly competing product, you'd prefer your org's telemetry and suggestions are directed towards improving your own software rather than your competitors'.
This was always a little weird to be because Microsoft internally is actively hostile to cross-org collaboration. If you worked in most of Azure you basically have 0 lanes of communication with someone from the Windows team and vice versa. Triply so for stuff like Kusto or Teams which you'd be dogfooding daily. I guess if there's a horrible stop the world bug it'd get surfaced through telemetry but normal user feedback is not a thing.
Compared to working at other big techs, where I was able to direct msg the engineers on the team for internal protobuf or datalake services in addition to user groups that were generally responsive it was just strange. Also Microsoft doesn't have a monorepo so you can't just commit patches to their service because you don't have access to their repos which I pretty regularly do elsewhere.
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Maybe it's just Microsoft moving to more model agnostic tech within their copilot. I recently started using Microsoft 365 Copilot because corporate added Cowork which runs on Opus 4.7 which was better than the alternative we have available. Unlike the "real" Claude Code or Cowork this only has access to files in a specific onedrive folder in your personal sharepoint container, so it's much more compliant to things like NIS2.
Technically we're using Copilot and we're playing for it through Microsoft licenses, but it's using Opus 4.7. Even before this, most of our custom agents within m365 copilot were one of the GPT models.
Or maybe you're right and they want their developers to use the copilot models.
Copilot Cowork seems to be the best part of M365 Copilot by a huge margin.
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Copilot was great when folks were semi-attempting write their own coffee and needed auto complete.
There's a large (and growing!) contingent of people who don't write code these days. (Many don't even use the keyboard.)
Wonder if Amazon will do the same with CC and Kiro now that we internally have access to both.
I think Kiro might have some “first mover” advantage internally, but CC feels better to use.
I never understand why Amazon even bothers to build their own coding agent.
GitHub Copilot is in a somewhat similar place as Microsoft's toy but still different -- it was more or less the first coding agent/assistant, and GitHub/VSCode/Microsoft has enough user base and impact to influence individual users and enterprises' choices.
For Amazon's coding agent -- I just never see anyone outside Amazon even mentions Kiro or Amazon Q. Maybe a little bit when Kiro was offering tons of free credits. But I don't think it's even remotely relevant these days. I don't see news about companies adopting Kiro.
To me, it's just a matter of time before they are sunset, like Chime or a bunch of AWS products.
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There's definitely a way to use Claude code that is token conscious.
I've tried throwing unsupervised agentic software factory workflows against the wall, and they burned through my tokens like nobody's business but didn't produce much.
Supervised, human-in-the-loop process on the other hand is much more productive but doesn't consume nearly as much. Maybe that's why everyone's pushing agentic approaches so much.
The current thinking is automated agents is what turns this from an industry in the tens of billions to a multi trillion dollar one. So yes you are right on the money, agents stimulate demand for this thing they've built.
"The bureaucracy is expanding to meet the needs of the expanding bureaucracy"
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Yeah. Claude does good work but reviewing it all properly takes quite a bit of time. It got to the point I started having trouble maxing out my weekly allocation.
Dealt with that by going all out and making an agentic parallel code review skill. Basically an infinite TODO list generator. Now I'm definitely getting 100% of the usage I paid for. It really burns tokens like nobody's business, and catches a lot of issues while at it. I've been looping this review/fix process every week. It's dramatically reduced the amount of stuff I need to pay attention to during my human review sessions.
I really don't like how the payment plans work with the providers right now. I feel this pressure to use all my tokens for the week, often just "wasting" them. But also, I want to take advantaged of the subsidized tokens in Claude Code and Codex for as long as I can.
There is this real danger that our thinking, and the things we make, become bloated without constraints.
IMO software has gone to shit since both mobile phones and laptops mostly have massive amounts of compute. We always seem to use it to the limit, just because it's there.
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I’m interested in how this works in practise - I guess you’ve written a skill to do code review, then your Claude.md file tells it to use it after every change as a bg task? So does this work as a background task while Claude is working on the next ‘feature’?
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I think it's great. People at a broad scale are getting first hand experience with resource management. It's a fairly cheap way of doing it too (in contrast to: learning this by managing humans) and we can all benefit from the skill transfer.
I find myself observing how my lead manages meetings ... "ah, this is like when I do that with Claude", "this is where he wants to understand what happened, like when I ask Claude" ... it's funny.
At the enterprise level though, its going to be hard to want to use a service in which costs are not predictable, and keeping those costs under control requires employee training.
>...use a service in which costs are not predictable, and keeping those costs under control requires employee training.
Isn't this a (mildly exaggerated) description of AWS, which is a very successful service?
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Am I losing my mind, aren't there multiple headlines each day about companies penalizing employees for not using AI enough?
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You can put a limit on token spend and provide training (and even pre-configured workflows) on how to limit token spend.
Like the other commenter said: cloud spend can also spin out of control if you don't pay attention, yet we've found ways to keep it under control (training, guardrails, limits, transparancy).
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To be fair, the cost of software development has always been fairly unpredictable. What may be different is that the cost used to be roughly proportional to man-hours spent, while now the number of agents running in parallel may be less predictable.
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There's no fucking training to mitigate a slot machine.
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> There's definitely a way to use Claude code that is token conscious.
Colleague used Sonnet 4.6 on some pretty normal agentic coding tasks through AWS Bedrock to keep the data in the EU, 100 EUR usage in a single day. In comparison, the Mistral subscription costs about 20 EUR per month and we tested that for similar tasks it was okay, the usage got to around 10% of that monthly limit in a single day. Or Anthropic's own Max (5x) plan where you get way, way more tokens to do with as you please.
I feel like the sweet spot is having a monthly subscription with any of the providers (you're subsidized a bunch), but if you have to pay per tokens, now I'd just look in the direction of what tasks DeepSeek would be okay for, sadly probably not in the situation above. For a startup, though...
On the other hand, this feels a bit hypocritical:
> It was part of an effort to get project managers, designers, and other employees to experiment with coding for the first time, and sources tell me that Claude Code has proved very popular inside Microsoft over the past six months.
They're gonna say that the future is all AI... until they get the bill.
I was a Mistral Le Chat Pro subscriber (the €20/month plan). Yesterday I hit my monthly limit. Switching to PAYG I burned through another €40 in one evening, working on the same project, with the same tasks.
I upgraded my plan last night to Mistral Le Chat Teams. This now costs me €60 per month for two users. Limits have been reset, but I have no idea now if my per seat limit is higher than the Pro plan, or if the limit is shared between the seats, it’s really not clear. I guess I will find out next month. The limits reset on the first of the month and I really hope I don’t hit them in the next seven days.
I use Mistral Vibe CLI and I’ve written and implemented a couple of new skills[1]. Caveman, based on an idea I found online somewhere, this skill removes all extraneous response text, including articles. Makes for some fun reading, but supposedly reduces output tokens significantly. Hash-anchors, this one is based on a concept from Dirac[2], reduces search failures and also includes multi-file dispatch. It will be hard to measure, but Vibe tells me these two should result in roughly a 40% reduction in token burn.
[1] https://codeberg.org/MimosaDev/skills
[2] https://dirac.run/
I was trying to get a better sense of the time cost quality matrix of these, so I threw together a quick eval of Sonnet 4.6, Mistral's dev model, and Opus 4.7 (figuring it's what you'd use if you were on Max).
The results for a function implementation and test of levenshtein distance in js are pretty similar but Mistral is 30x cheaper than Opus 4.7 and 4x faster than Sonnet 4.6.
https://5m6qnuhyde.evvl.io/
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> They're gonna say that the future is all AI... until they get the bill.
I mean, the will continue to say so, they just want to be the ones being paid for the service, not anthropic :)
My experience as well... I've only hit Antrhopic's 5hr threshold a few times, and two of them was within a half hour of the window. Also, all three times I'd already accomplished a LOT.
I tend to work with the agent, and observe what's going on as well as review/test and work through results/changes. I spend a lot more time planning tasks/features than the execution, even using the agent as part of planning and pre-documentation. It works really well. I don't think people burning through the 5hr allotment in under an hour are actually reviewing/QC/QA the results of what they're doing in any meaningful way, and likely producing as much garbage as good (slop).
I'm really curious as to HOW the MS employees were using the agents as much as what they were doing.
I suspect subscription limits are quite a bit higher than the equivalent tokens their dollar cost could purchase. I similarly feel like I can get a lot done with a $20/mo Claude Pro subscriptions, but also can easily spend $10-20/day at API pricing with similar usage.
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> There's definitely a way to use Claude code that is token conscious.
By buying a subscription and dealing with the limits, using claude code and paying per token seems like the fast lane to the poor house.
I get 98.6% cache hits on Claude code. Short of drastic arch changes it’s hard to imagine it getting much better.
98.6% cache hits doesn't distinguish an efficient workflow from an overly chatty linear agent repeatedly reusing the same context. Plus, it says nothing directly that the process has good useful progress per token.
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You pay for cache hits on every turn and even with the newest architectures longer context is slower/more energy intensive. Constructing concise turns that reuse prefix and stop when the new context is no longer useful help, as does pushing generation down into cheaper models while using stronger models for verification.
yeah, by using codex
---- Before it was:
Me: We need to do this this that.
Claude: <random stuff that approximates human outout>
Me: Are you sure?
Claude: Well actually there is a bug <more random stuff that looks right this time>
----- Now it is:
Me: We need to do this this that.
Claude: <random stuff that approximates human outout>
Claude: Let me consult the advisor on that.
Claude: advisor came up with some advice, adjusting according to that. <more random stuff that looks right this time>
So, snippet from the article says the following:
> I understand that Microsoft is planning to remove most of its Claude Code licenses and push many of its developers to use Copilot CLI instead. While Claude Code has been a popular addition, it has also undermined Microsoft’s new GitHub Copilot CLI coding tool — a command line version of GitHub Copilot that runs outside of development apps like Visual Studio Code.
And people here are interpreting this as related mainly to the Claude burning too much tokens too quickly and suggesting Microsoft should rather use SomeOtherLLM©?
Is this Hacker News or rather Marketing Wars?
So "Microsoft chooses to eat its own dogfood" is a more accurate title?
> Is this Hacker News or rather Marketing Wars?
No public forum is naturally immune to the spread of (guerilla) marketing. [1]
[1] Internet Rule #48
I don’t think people read the article, I didn’t until I saw your comment. The article feels like clickbait tbh.
It's a forum called Hacker News that's been hacked and covertly refactored into Marketing Wars. Being their primary goal is to foster a space to draw-in (marketing) projects/start-ups.
Por que no los dos?
Eso mensaje de hijo de Carlos
Äh, was?
Feels about right.
I've launched an internal demo of Claude Code and Deepseek on the same day and we burned through our monthly allowance for Claude in just over a week, with more than a half of that budget being spent in one day. With DS people are unable to go through that same amount of money in a month, not even close.
With that Claude feels like an expensive toy, while DS is a shovel, purely because developers do not feel like they are eating into a precious resource while using it. Also it does not feel like there is much of a difference in capability between Claude and DS-pro. DS-pro and flash do feel like sonnet/opus and haiku, but flash is still very-very capable.
I rage canceled Claude today.
After 2 weeks of Claude getting progressively worse and worse, today was the final straw.
I don't care if they have a phone app. The model is COMPLETE garbage after you subscribe long enough and they think they've "got you".
I can't code on my phone if the model literally moves in the wrong direction and does the opposite of what I tell it to. If I wanted to make my code worse, I'd just randomly commit garbage. I don't need a mobile app for that.
I've seen a lot of this sentiment over the previous six months from people on reddit. I have yet to experience this myself as a developer with over 20 years of experience.
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All these tools have almost feature parity. The GitHub cli allows remote sessions and can run anthropic models anyway
When you say "code on your phone" ... you don't mean what I think you mean do you? Like, are you actually using your phone to make code commits?
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Considered Gemini?
Gemini got a big reduction in usage limits this week. There was backlash and they added 3x usage for Antigravity a day later but I haven't really tried it out to get a feel for it yet.
Google rug pulled Code Assist and Gemini CLI. They're moving everything to Antigravity and we would need to reinstall all our tooling, reconfigure any automations, and the mechanism to subscribe via GCP is much clunkier.
This was all supposed to be worked out prior to Cloud Next, but it wasn't. Ironically, they mentioned Claude in a few of their presentations at next.
And that was our solution. We are a big GCP customer but our whole team is on Claude now and much happier.
Google has burnt all of its goodwill in dev communities so no, I don't think Gemini is worth consideration.
It seems like new Holy Wars will rage between those who can afford models like the Opus 4.7 or GPT 5.5 Pro, which in my opinion are unlikely to have been used for anything serious, as they're simply several times more expensive than any human effort. There's a speed advantage (still questionable), and quality isn't guaranteed, but the price completely kills everything. And between those who actually write the code and calculate the development costs. I won't talk about large corporations that can afford it, much less those who develop models. "Mere mortals" simply don't have such opportunities. 17 GoLang microservices for a serious project were written perfectly using the latest version of QWEN. The only areas where we really had to work hard were documentation and a very serious task breakdown. All of this was tested, and yes, a review was required, but everything was within reason. The deadline was 10 days of 24/7 work, including the review. When attempting to submit the same task, Opus 4.7/4.6 had to be stopped after three hours. If you have significant resources for experimentation, you can certainly try. For us, the choice is absolutely clear at this point.
I’m curious to learn of your problem where you needed 17 Golang microservices (assuming these are newly created).
My experience is, Claude Code burns way more tokens compared to other agents, probably to ensure high levels of perceived quality, which is, most of the times not worth the bloat for the user. The bloat works for Anthropic as an advertisement at the cost of your tokens.
its kind of weird tho, jensen also said we should be burning tons of tokens as well... 'perceived quality' cant be the only reason these ceos pushing token usage so hard can it?
reasons for token usage beyond expectations
1. right now, usage correlates with experimentation and learning, few if anyone knows how to make these things effective on their own over long sessions of activity
2. long term, you should be using more than one agent at a time, because they are running in the background based on events (new direct message / something happened in eg. github)
Thus does kind of beg the question: If developers are being laid off because AI is better/faster/cheaper or makes all their people 10x or whatever fig leaf, what happens if the required tooling ends up being more expensive? From the investor’s point of view is the drag of employee costs better or worse than a ballooning expense item?
They lay people off and look good in front of investors. Then they hire people, talk about "growth", and once again look good in front of investors.
This would never fly if stock market was rational. But it never is.
And if/when companies need to scale back their ai investments they can spin it too and the stock market will eat it up.
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> If developers are being laid off because AI is better/faster/cheaper
This is, in my opinion, tripe. SWEs are being laid off because of post-Covid over-hiring. The only evidence for labour destruction is in junior hires. But not because anyone is being fired, but because entry-level jobs are being cannibalised.
In general economy that is not the stock market is looking less and less great. Answer to this is to tighten the belt and that means losing employees. Especially as there has not been any new great revenue sources outside AI in recent years.
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I suppose if it all works out it'll end up way more expensive than the employees the models displaced ever were. These kinds of technologies usually end up as an oligopoly at best, and those players will have a wide moat by then, and the things these models build will be tweaked such that no other model or human being can realistically work on them anymore, and then they can price gouge everyone to the brink of unprofitability.
At least the models don’t need health insurance, office space, a cafeteria, or have a threat of unionizing.
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There's 10-15 labs near the frontier, and like 30 serious inference providers, over 70 total on OpenRouter.
With research and hardware near guaranteed to bring the efficiency way up, I'm not scared here of massive price hikes.
There is no moat.
I suspect AI would have to get drastically more expensive before it starts looking worse than payroll. If one developer using Claude Code can effectively substitute for 2 developers, you are already coming out ahead at current API pricing assuming very heavy usage, your cost is going to be ~1.5x developer (factoring in beyond salary - benefits, PTO, the other overhead that comes with having employees).
So you're getting 2 for the price of 1.5. Scale that up to 500 devs at a big company and it's a big chunk of change saved on payroll.
Keeping your headcount or hiring humans instead, AI would have to start to cost upwards of $15k/month/developer or more before it costs more than hiring. You're looking at about 4 billion tokens per month before humans start to break even or are cheaper.
You're starting from the assumption that its a 2x benefit. That's a massive leap.
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This is economy dependant. It’s really Indians why will take the brunt of AI job losses.
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More expensive is a difficult calculation: faster can sometimes warrant the higher cost, if it means you can go faster to market. Also, LLMs work 24x7, and can be scaled up and down as needed. Faster to off board an LLM than to fire an employee (especially here in Europe). So, even if AI is more expensive than a developer, from TCO and ROI perspective it can still make business sense.
"AI" is just a cover for laying ppl off and saving cost. But the pendulum will swing the the other way and the companies will realise that knowledgeable ppl are still required to generate and utilize the generated code. No serious company can run with vibe-coded apps generated by laymen.
There is no profit, expense, revenue. Those don't matter. Only thing that matters is stock price goes up, and laying off makes stock price go up. When laying off make stock price go down, then laying off stop.
I imagine layoffs are also very much "this quarter and next quarter" with regards to investor visibility.
While LLM Opex is "some future quarter" and very easy to co-mingle with other expenses.
I switched from Anthropic to OpenAI after spending ~$40K in equivalent token costs using Claude over 3 months.
I found Opus 4.7 to be slow and wasteful with token usage. It's shocking how inefficient it is with tasks like bash tool usage and web searching, delegating them to a dozen subagents only to get stuck and never return until you esc and intervene. That, in addition to all of the broken tooling Anthropic built in to limit token usage like the broken monitoring tool made managing Claude a chore. I was happy to pay $200/month for Opus 4.5 when they had more capacity, but 4.7 felt like a huge step back and no longer worth the price and inconvenience.
I remember an OpenAI employee comment on the GPT5.5 release post about how they specifically geared it towards long-horizon tasks and its been a breathe of fresh air in that regard. I have five two-week long sessions going right now and there's been no degradation in performance or efficiency. It's much better at carrying rules/learnings forward even in long-running sessions and grounding/refreshing itself in verified facts when it loses context.
Its funny because in two weeks I've gotten way more done with GPT5.5 with way fewer tokens and way less handholding. I think this goes to show how important tooling and the harness is and how a capable model like Opus 4.7 can be severely handicapped by bad product decisions.
Being able to mange context over long running sessions is a function of the harness, not the model. Are you using Claude Code with GPT5.5? Codex? piclaw? They’ll all have different context management strategies to let you keep going when you would otherwise have filled up context and be forced to stop.
It doesn’t matter how good the harness is if the model does a bad job of planning and continuing from long context. A good harness cannot overcome a weak model.
Cancellation effective June 30. This was a _pilot_ launched in December that accidentally consumed their 2026 yearly target spend on AI!
I expect the r/LocalLLaMA guys to be going nuts about this news.
From the article
> It was part of an effort to get project managers, designers, and other employees to experiment with coding for the first time.
I suspect they weren't as efficient as they could be with token use either. Sounds like they were trying to encourage non-developers to vibe code stuff
I'd argue you have a lot more to worry about with developers as far as token usage goes because they're the ones who know how to rig up these wild workflows where tens of agents simulate an entire software development team. The non-developers are probably going to be sticking more in the realm of iterating via chat.
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Our shop is forced to use Copilot on gov cloud, and it’s so useless I usually stick to manually coding. Its syntax is messy, it randomly combines lines together, flips order, or drops a couple tokens worth of output in the middle of a line, and for some reason it consistently drops the last line of every code block. I assume we’re getting a few versions back of GPT under the hood. But it does make me appreciate how the models of the past year or so crossed the threshold from interesting to truly productivity-enhancing.
Between Copilot, Claude, and Gemini, I still actually prefer Gemini. I do a lot of scientific writing in addition to coding and Gemini is the only model I can trust to “just be right”. This trust then transfers over to its code output.
If you are talking about the Copilot built into vs code, that's not been my recent experience at all. Very capable in agent mode since gpt 5.4 came out.
Especially since gpt 5.5 it's on par with Opus 4.7 or Sonnet.
I’ve been quite content with CoPilot’s $10/mo plan. Still offers access to Claude models (limited tokens) but has no time limits like the $20 Claude plan, so no interruptions in work flow. I use one of the free models for the more pedestrian tasks then sic Claude on the particularly thorny problems. Works very well for me.
I'm not sure if you are referring to the old or new plan?
Github Copilot offered probably the best value and was IMO underappreciated for a long time; I've been an annual subscriber since day 1.
The changes announced a few days ago completely revoke that value proposition, I doubt I'll continue with it.
There’s a new plan? Ugh. I signed up about five months ago.
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Copilot was the best deal in AI tooling for a few weeks there.
New pricing model changes that. I will still keep it around for autocompletion (for the rare times when I open up an editor).
Can even buy more premium tokens for more Claude use, which I have done once. But most of the time the tokens included in the plan are sufficient.
The title is somewhat bait. It reads like MSFT is using less AI, while in fact it's just a force swap to Copilot.
Arguably, Copilot is GPT 5? Not sure what the CLI offers behind the covers.
Copilot is the name for the harness / wrapper of MSFT products
The CLI can swap to whatever model (/models) based on your subscriptions.
The copilots on desktop or Office Apps are likely just GPT5 nano or other tiny models with cheap inference
Employees (at least on my team) get access to the Claude models as well when using Copilot CLI.
I disagree. As someone who just got a new Windows laptop with Copilot baked(forced) in I've tested Copilot a lot.
It. is. so. bad.
It feels like it's at least 1-2 years behind the current top models.
But there isn't a copilot model is there? Just a harnesse, and the vscode copilot extension is pretty good (haven't tried the tui)
Copilot cannot be behind any models because it's a harness, not a model. You can use any of the popular models through it, including Claude models. Though people have been saying that Claude CLI is a better experience.
Your Copilot free offering isn't the Copilot they're using within the company for coding assistant. It's confusing I know.
Copilot is not the same agent as GitHub Copilot.
I'm surprised they even had them in a first place. Doesn't Microsoft have a deep partnership with OpenAI? Aren't all Copilot things powered by various GPT models? I would assume the two companies have barter agreements of sorts.
They do have agreements, but they aren't exclusive, and Microsoft and Open AI have had a rather public falling out over the last year.
Lots of these places measure employee token use with managers having dashboards. It seems like performative code production rather than making anything useful.
Speed without judgement always compounds badly.
Tokens are current era' "lines of code per month"
https://www.folklore.org/Negative_2000_Lines_Of_Code.html
Well, that's the inevitable outcome of token-maxxing :shrugs:
More here: Microsoft reports are exposing AI's real cost problem: Using the tech is more expensive than paying human employees - https://fortune.com/2026/05/22/microsoft-ai-cost-problem-tok...
I think tech companies are doing layoffs partly because they need to cover AI operating expenses.
I think so too, otherwise why wouldn't you put that (purported) increased capacity/output into improving your existing products or creating new ones, with the headcount that you already have?
This might actually be clever since Microsoft dev will be longing claude code features and might result in copilot getting way better
That's what we've spent the last five months doing! Have you tried the Copilot CLI recently? We've onboarded loads of feedback from Microsoft devs who were switching from Claude Code -- I'm proud of how far the team has come! This announcement comes at a time where Copilot CLI usage has been greater than Claude Code usage at Microsoft for several weeks; we've been winning hearts and minds!
Related: Microsoft-owned GitHub recently switched to token-based billing:
https://github.blog/news-insights/company-news/github-copilo...
Claude tokens are priced by GitHub at a disproportionately premium price compared to Gemini and OpenAI. I wonder why?
https://docs.github.com/en/copilot/reference/copilot-billing...
I think whats funny is that employees were most likely already covering the cost for these tools because they are useful. Companies didn't believe employees were using these tools and now have forced their usage and no longer have the costs subsidized.
Similarly companies seem to reward high token usage as a sign of someone willing to play ball with AI and again have forced higher costs on themselves for people reward hacking or using tokens out of spite.
There is no world where I can put my company’s data through an external site without their express consent and security sign off. I suspect at most companies there’s zero path for people to have been paying for it themselves.
An enormous percentage of America’s white collar work force has been doing this since 2023.
Fun fact, up until you face a consequence for crime, all crime is free! Have fun and go win the competition game against your co-workers.
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My guess is that at most companies, employees are prohibited from doing this, but not prevented.
That's very interesting to reconcile with the fact that not too far, Amazon employees feel incentivized to use as many tokens as possible.
"incentivize to use as many tokens as possible" = "Upper management knows people dont like change so we are forcing them to come up with ways to use this thing". It does not mean that management will encourage wastefulness in the future, and it also doesnt mean that token usage from now wont be reviewed in the future. Whats to stop them from dinging your performance in november because you wasted a hundred thousand on tokens with nothing to show for it?
Makes sense why Anthropic wants to IPO as soon as possible as the growth right now comes from temporary wastefulness. Makes all the investments more risky.
If you properly keep documents, architecture, and decision records, token consumption can be pretty less. Iam managing everything with two codex plus sub. Repo size is 300 k loc ( backend).
I switched to OpenRouter and OpenCode a while ago. It is much cheaper, much much cheaper, and A LOT more reliable. Particulary Gemini was a piece of trash when it came to uptime
I switched from Claude code to the GitHub copilot app recently. Since our repositories are hosted on GitHub I find the copilot app better integrated for the PR workflow with PR management available in the app. I don’t think I miss any of the features of Claude code I never thought I would make the switch but copilot upped the game.
Also it became very hard to convince management to keep both Claude code and GitHub Copilot enterprise licenses.
Reminds me of when Steve Ballmer forbade his children to use iPods and pushed towards the Zune instead. Hahaha
1) They can still use Anthropic models.
2) Opus is not even unambiguously best at coding anymore. GPT 5.5 splits that title for some time now.
3) I would have probably done the same in his position. Dogfood the product.
Dogfooding only works if it actually helps improve the product. zune never improved. Dogfooding without improving is just eating dog food for no good reason.
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Surely a company as large as Microsoft is actively attempting to build their own models. They couldn't possibly have expected to stake the future of their software development on the conditions of a third party company?
Okay, but what if you're not Microsofts size and don't have and R&D budget large enough to fund development of your own models and tools?
This is a warning to any company, not building their own AI, that AI assisted development could become really expensive really fast and most likely won't pay off. What Microsoft is suggesting is that the current price is to high, but it's still not high enough for e.g. Anthropic to be profitable, or AI coding tools are only as good as the developers using them. So you can't meaningfully do layoffs by replacing the developers with AIs, because the cost is to high.
How does Microsoft plan to fix CoPilot, so that the cost will be so much lower than Claude, that budget overruns won't be a problem for their own customer?
I expect in the next year or so, we'll stop seeing headlines like "Anthropic buys $15b of compute from SpaceX" and we'll start seeing headlines like "Uber's AI department licenses GPT 6.2 as the foundation for their internal model," or something like that.
Smaller companies will have departments that distill larger models into something more specifically manageable and useful for them. At least, that's my personal prediction :)
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Giving your workforce Claude is like giving everyone in the USPS a Ferrari.
There may be a spot of “good enough to pay for and make a profit” that exists.
MSFT and Apple are taking the same approach.
The frontier model space costs 1000x as much to develop as the small language models, and is only 1.5 years ahead.
Factually, the frontier models have not paid for themselves. So, if you're MSFT and Apple, you don't need to run in a race where even the winner loses massively.
You can try to train models 1.5 years behind that are highly likely to be profitable, given your market position.
The average person is lagging behind what AI is capable of by 3+ years anyway...
So you can save 1000x on training and 10x on inference and just use SOTA small models.
Why spend $5B training a model that's for sure not going to make $5B (after inference costs) when you can spend $5M building one that WILL make far more than that after inference costs?
> attempting to build their own models.
At one point there were rumours that they'd do that. They also have the rigts to oAI models for a few more years still, so they could always use that but apparently they're also compute starved (like anyone else).
MSFT does have a frontier AI Lab. My friend works there. I don’t know what they’re doing. But MSFT is one of like 5 entities that actually have the talent and physical infrastructure to compete in model-building.
Curb Your Enthusiasm theme starts playing.
i was thinking more arrested development but that works as well
after having used claude for quite some time, i would buy puts on microsoft
Good luck to them! I recently had the misfortune of fighting Copilot on a Github PR and it made me want to never contribute to the project again.
The way coding agent work is fantastically wasteful. All the megabytes of code are processed over and over and over, sometimes withing just one session.
There are papers describing KV cache precomputation for commonly used documents (e.g. KVLink), but, of course, it's not a priority for model providers: they'd rather sell you more tokens, also they would rather get to AGI/ASI first than optimize usage of existing models...
Claude code gets >98% KV cache hits. It’s not reprocessing unless you let the cache go cold (5 minutes, which is annoyingly short).
I meant caching on a bigger level. If you're an organization with 100 developers each doing 10 sessions a day, you're paying for 10000x tokens in frequently used document even if you had 100% KV cache hits within one session. Apparently that's too costly even for companies with trillion dollar market cap...
Normally KV cache works only if your context prefix is identical, but there are papers which demonstrate documents can be cached between different contexts.
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I believe OP is talking about new sessions or after compaction. He’s getting at the fact that LLMs are stateless and have to rediscover your codebase on every new session.
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Are you sure that hitting the cache mean you’re not paying for those tokens?
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How efficient is Claude at cleaning up unused code and making things more simple - as good as it is at adding code / features?
Microsoft should host DeepseekV4 internally for its developers. And you're welcome.
Microsoft does self host claude and gpt for GHCP
This is the smartest solution to do, to self host the model locally on premise.
And by that, you mean, in Azure, surely.
What's the point of eating your own dog food when the only thing you are doing is reselling other people's dog food? Microsoft don't have any competing LLM.
I have noticed particularly in recent weeks and maybe couple of months that token costs are just ridiculous. I can understand the upcoming IPOs and instinctive pressure to show profits ... but let's be honest, showcasing burning 1.3 million USD in tokens by a single developer in a month is the most ridiculous thing I have seen in my entire life. The general principles still apply. You expect investing X and have a return on such investment. Unfortunately that's not so easy to promise or expect. There's no real 1 to 1 correlation between amount of code written and returns, and even less between tokens burned and returns. I start to believe that the current token pricing approach, followed at the moment by all leading labs (especially considering OS models capabilities), is bordeline delusional ...
They got DeepSeek on Azure, would cut costs by 10x … if they ran it on Huawei
Tokens aren’t that much of an issue when your not evaluated on the usage
My impression is they're being cancelled in favor of full internal adoption of Copilot CLI, which has got much better over the past few months.
I'm also a big fan of Copilot CLI, especially after demoing it to a coworker who liked Claude Code.
"everybody needs to use these new AI tools or you will be left behind. no! not like that! the cheap, worser ones!"
How would one call such a strategy? Embrace and extend comes to mind.
This has really little to do with embrace and extend. They are not taking over an open standard or anything like that.
If anything, it's forced dogfooding, i.e., forcing their own workforce to beta-test their product.
To be fair, Microsoft dogfooding something for once would be great.
It seems that people are using LLMs to generate code but many complain of sub par code. I recall the early days of virtualization when folks will use it but complain about performance. HW capacity continued to improve until virtualization became de facto standard. I wonder if sub par code will become better as more powerful agents models or compute become available.
What per cent of internal Microsoft IP runs through Anthropic? Do they not care about trade secrets, or certain groups allowed or not allowed to use tools that expose IP to external vendors?
This feels like these kind of bad incentive problems we always here about on here ... Like bugs and vipers.
Doesn't MS have the compute to run GPT 5.5 for all its employees?
It's been said that technologies are not product. CC might be better, but at the end of the day M$ is going to want to cut costs and have employees use their own technology. Perhaps Copilot CLI is close enough, and the CC product doesn't justify the cost of the Claude (technology) license when M$ has their own technology to leverage.
Side note, it's so frustrating that The Verge puts a paywall at the fold. It makes me feel like the rest of the story is not worth reading. I'm not inclined to pay $2 to read a link that was posted on an aggregator.
This is an AI generated summary of a blog post (https://www.thelowdownblog.com/2026/05/microsoft-cancels-int...) which is a summary of an AI generated article (https://blazetrends.com/microsoft-cancels-claude-code-pilot-...) which is a summary of another AI generated article (https://www.themodelwire.com/article/microsoft-starts-cancel...) which is a summary of an article from The Verge (https://www.theverge.com/tech/930447/microsoft-claude-code-d...). I guess it would be better to link the Verge article instead.
The absolute state of the Hacker News main page in 2026. Thank you for taking your time to put it all together.
https://archive.is/WfCta
2nd link doesn't work. That would be a neat tool, to find the original article and see how many levels of AI summary it has gone through, a game of AI telephone!
I had thought about creating something like that for finding comments for articles. For a given article, display links to comments for HN, lobsters, reddit, etc. However, I feel I already waste too much time reading comments. I shouldn't make it easier and more tempting.
My bad. I had trouble finding the original source when I googled for it and grabbed a link. I was originally shown a screenshot of a x.com post.
I emailed dang to politely ask to make the link point to the Verge article since I can't update it.
i swear i'm going to start an amish community and internet where we forbid any technological development past 2019
call me a luddite, i'll be wearing it as a badge of honor
Man, maybe it's time for me to give the verge a subscription. There the only ones actually doing any journalism here and a bunch of AI blogs skimming off the top.
boy i'm leaving the internet. sun is shining. was a good time here while it lasted.
The artificial centipede.
Welp, this is the future we live in now
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AI slop ruined a story about AI? This thread is a story about itself.
Microsoft poorly manages token use of most expensive models in a pilot. Then they use that failure to advertise/position their own Github Copilot agents to procurement teams, over the now widely validated Claude Code-based agents.
At least Codex is trying to win validation on merit.