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$1k per day, 50 work weeks, 5 day a week → $250k a year. That is, to be worth it, the AI should work as well as an engineer that costs a company $250k. Between
by nine_k 9mo ago
$1k per day, 50 work weeks, 5 day a week → $250k a year. That is, to be worth it, the AI should work as well as an engineer that costs a company $250k. Between taxes, social security, and cost of office space, that engineer would be paid, say, $170-180k a year, like an average-level senior software engineer in the US.
This is not an outrageous amount of money, if the productivity is there. More likely the AI would work like two $90k junior engineers, but without a need to pay for a vacation, office space, social security, etc. If the productivity ends up higher than this, it's pure profit; I suppose this is their bet.
The human engineer would be like a tech lead guiding a tea of juniors, only designing plans and checking results above the level of code proper, but for exceptional cases, like when a human engineer would look at the assembly code a compiler has produced.
This does sound exaggeratedly optimistic now, but does not sound crazy.
- lbreakjai 9mo ago$250k a year, for now. What's to stop anthropic for doubling the price if your entire business depends on it? What are you gonna do, close shops?
- drited 9mo agoBy then perhaps it will be possible to continue with local LLMs
- teaearlgraycold 9mo agoWhat’s to stop them? Competition.
- blibble 9mo agothat worked real well for cloud computing aws and gcp's margins are legendarily poor oh, wait
- riku_iki 9mo agogcp was net negative until last year. Big part of why clouds are expensive is not necessary hardware, but all software infra and complexity of all services.
- oblio 9mo agoAll the big clouds are still in market share acquisition mode. Give it about 5 more years, when they're all in market consolidation and extraction mode.
- direwolf20 9mo agoMaybe not worth using then. Your product costs 5x and delivers 0.2x of competing product in the adjacent product class (traditional server/VPS), why use it?
- riku_iki 9mo ago
- ikr678 9mo agoYeah this is just trading largely known & controllable labour management risks for some fun new unknown software ones. You can negotiate with your human engineers for comp, you may not be able to negotaiate with as much power against Anthropic etc (or stop them if they start to change their services for the worse).
- toddmorey 9mo agoI mean… What does your shop even do? Write software? Why? The whole premise is that it’s now easily cloned.
- andersmurphy 9mo agoIf this is successful supply shock will kick in (because of energy/GPU constraints) and we could easily see a 2-4x price increase maybe more if the market will accept it. That's before taking into account current VC subsidies.
- skeeter2020 9mo ago>> $170-180k a year, like an average-level senior software engineer in the US. I hear things like this all the time, but outside of a few major centers it's just not the norm. And no companies are spending anything like $1k / month on remote work environments.
- nine_k 9mo agoI mean, it's at best an average-level senior engineer salary, not some exorbitant L6 Googler salary.
- shimman 9mo agoMedian salary for a software engineer in the US is ~$133k: https://www.bls.gov/ooh/computer-and-information-technology/software-developers.htm https://www.bls.gov/ooh/computer-and-information-technology/...
- flaminHotSpeedo 9mo agoI question their data if their p90 value is $211k I recognize that not everyone makes big tech money, but that's somewhere between entry and mid level at anywhere that can conceivably be called big tech
- wavemode 9mo agoMost companies, and most jobs, aren't in big tech / silicon valley.
- shimman 9mo agoYou're right, better to get the self selected data from levels.fyi that mostly cater to 6 cities in the country. Way more accurate then! You need to vacate your bubble pronto.
- flaminHotSpeedo 9mo ago
- nixass 9mo ago> 50 work weeks What dystopia is this?
- nine_k 9mo agoThis is a simplification to make the calculation more straightforward. But a typical US workplace honors about 11 to 13 federal holidays. I assume that an AI does not need a vacation, but can't work 2 days straight autonomously when its human handlers are enjoying a weekend.
- monooso 9mo agoThere are no human handlers. From the opening paragraph (emphasis mine): > We built a Software Factory: non-interactive development where specs + scenarios drive agents that write code, run harnesses, and converge without human review. [Edit] I don't know why I'm being downvoted for quoting the linked article. I didn't say it was a good idea.
- nine_k 9mo agoThe human handlers write specs, etc. The AI can't work for days on the same task, I suppose; the feedback must be faster.
- fipar 9mo agoI took it as a napkin rounding of 365/7 because that’s the floor you pay an employee regardless of vacation time (in places like my country you’d add an extra month plus the prorated amount based on how many vacation days the employee has), so, not that people work 50 weeks per year, it’s just a reasonable approximation of what the cost the hiring company.
- direwolf20 9mo agoLooks like standard USA?
- pydry 9mo agoIt sounds exaggeratedly crazy.
- bee_rider 9mo agoThat nobody wants to actually do it is already a problem, but some basically true thing is that somebody has to pay those $90k junior engineers for a couple years to turn them into senior engineers. The seem to be plenty of people willing to pay the AI do that junior engineer level work, so wouldn’t it make sense to defect and just wait until it has gained enough experience to do the senior engineer work?
- Zakodiac 9mo ago[dead]
- ozim 9mo agoI think that is easy to understand for a lot of people but I will spell it out. This looks like AI companies marketing that is something in line 1+1 or buy 3 for 2. Money you don’t spend on tokens are the only saved money, period. With employees you have to pay them anyway you can’t just say „these requirements make no sense, park for two days until I get them right”. You would have to be damn sure of that you are doing the right thing to burn $1k a day on tokens. With humans I can see many reasons why would you pay anyway and it is on you that you should provide sensible requirements to be built and make use of employees time.
- noosphr 9mo agoOK, but who is saying that to the llm? Another llm? We got feedback in this thread from someone who supposedly knows rust about common anti patterns and someone from the company came back with 'yeah that's a problem, we'll have agents fix it.'[0]. Agents are obviously still too stupid to have the meta cognition needed for deciding when to refactor, even at $1,000 per day per person. So we still need the buts in seats. So we're back at the idea of centaurs. Then you have to make the case that paying an AI more than a programmer is worth it.[1] [0] which has been my exact experience with multi-agent code bases I've burned money on. [1] which in my experience isn't when you know how to edit text and send API requests from your text editor.
- simsla 9mo agoIt doesn't say 1k per day. Not saying I agree with the statement per se, but it's a much weaker statement than that.
- jmalicki 9mo ago"If you haven't spent at least $1,000 on tokens today per human engineer, your software factory has room for improvement" - how exactly is that a weaker statement?
- simsla 9mo agoMy read of it was "by today", aka cumulative. But you're right that it can also be read as "just today". The latter is an absurdly strong statement, I agree.
- jmalicki 9mo agoI would love to see setups where $1000/day is productive right now. I am one of the most pro vibe-coding^H^H^H^H engineering people I know, and i am like "one claude code max $200/mo and one codex $200/mo will keep you super stressed out to keep them busy" (at least before the new generation of models I would hit limits on one but never both - my human inefficiency in tech-leading these AIs was the limit)
- ukuina 9mo agoTokens evaporate when you have Agent Swarms. Have you tried Claude Code Teammates, for example? https://code.claude.com/docs/en/agent-teams https://code.claude.com/docs/en/agent-teams
- jmalicki 9mo agoOnly for a few days - but going from $200-400/mo to $1000/day productively seems like a huge stretch. Also the eat tokens may be compared to single-tasking - when agent swarms move faster, I need to come back to that task sooner, slowing down the multi-tasking that allowed me to use a full 20x max subscription... so the overall usage once that is taken into account is smaller.
- richardw 9mo agoIt’s a $90k engineer that sometimes acts like a vandal, who never has thoughts like “this seems to be a bad way to go. Let me ask the boss” or “you know, I was thinking. Shouldn’t we try to extract this code into a reusable component?” The worst developers I’ve worked with have better instincts for what’s valuable. I wish it would stop with “the simplest way to resolve this is X little shortcut” -> boom. It basically stumbles around generating tokens within the bounds (usually) of your prompt, and rarely stops to think. Goal is token generation, baby. Not careful evaluation. I have to keep forcing it to stop creating magic inline strings and rather use constants or config, even though those instructions are all over my Claude.md and I’m using the top model. It loves to take shortcuts that save GPU but cost me time and money to wrestle back to rational. “These issues weren’t created by me in this chat right now so I’ll ignore them and ship it.” No, fix all the bugs. That’s the job. Still, I love it. I can hand code the bits I want to, let it fly with the bits I don’t. I can try something new in a separate CLI tab while others are spinning. Cost to experiment drops massively.
- latch 9mo agoClaude code has those "thoughts" you say it never will. In plan mode, it isn't uncommon that it'll ask you: do you want to do this the quick and simple way, or would you prefer to "extract this code into a reusable component". It also will back out and say "Actually, this is getting messy, 'boss' what do you think?" I could just be lucky that I work in a field with a thorough specification and numerous reference implementations.
- throwaway7783 9mo agoThis has happened to me too. Claude has stopped and said on occasions "this is a big refactor, and will affect UI as well. Do you want me to do it?"
- ryandrake 9mo agoI recently asked Claude to make some kind of simple data structure and it responded with something like "You already have an abstraction very similar to this in SourceCodeAbc.cpp line 123. It would be trivial to refactor this class to be more generic. Should I?" I was pretty blown away. It was like a first glimpse of an LLM play-acting as someone more senior and thoughtful than the usual "cocaine-fueled intern."
- htrp 9mo agowhy stop at 5 days a week?
- deleted 9mo ago[deleted]
- andersmurphy 9mo agoAssuming current prices are heavily subsidised (VC money) and there is a supply shock (because we don't have enough GPUs/energy). If that leads to double the price that means 500k/year, and if we see a 4x price increase that's 1000k/year. Suddenly, it starts to look precarious. That would be my concern anyway.