No Result
View All Result
SUBMIT YOUR ARTICLES
  • Login
Monday, October 27, 2025
TheAdviserMagazine.com
  • Home
  • Financial Planning
    • Financial Planning
    • Personal Finance
  • Market Research
    • Business
    • Investing
    • Money
    • Economy
    • Markets
    • Stocks
    • Trading
  • 401k Plans
  • College
  • IRS & Taxes
  • Estate Plans
  • Social Security
  • Medicare
  • Legal
  • Home
  • Financial Planning
    • Financial Planning
    • Personal Finance
  • Market Research
    • Business
    • Investing
    • Money
    • Economy
    • Markets
    • Stocks
    • Trading
  • 401k Plans
  • College
  • IRS & Taxes
  • Estate Plans
  • Social Security
  • Medicare
  • Legal
No Result
View All Result
TheAdviserMagazine.com
No Result
View All Result
Home Market Research Market Analysis

AI Isn’t Cheap — Here’s How To Spend Smarter

by TheAdviserMagazine
5 months ago
in Market Analysis
Reading Time: 2 mins read
A A
AI Isn’t Cheap — Here’s How To Spend Smarter
Share on FacebookShare on TwitterShare on LInkedIn


While enterprise AI spending remains relatively modest today, the potential for overspending is significant. Most organizations are still experimenting, with only a few production-ready use cases. But that’s about to change. Over the next two to three years, AI investment is expected to grow exponentially as enterprises scale their efforts to operationalize AI.

One major cost driver is the shift to large-scale generative AI (genAI) models, which require up to 100 times more compute than traditional AI models. And compute is just one lever. GenAI costs span both traditional infrastructure — like data, databases, storage, and networking — and AI-specific workloads such as model selection, token usage, training, and inferencing.

These new cost levers add complexity, but they’re only part of the equation.

GenAI Isn’t Traditional Software

Developing genAI and agentic AI systems is fundamentally different from traditional software development. These systems are probabilistic — meaning outputs can vary even with the same input. In black-box AI services, pricing structures can change without notice or transparency. Margins are dynamic and unpredictable, making cost management — and forecasting — especially challenging.

Still, every AI use case includes standard levers that can be tuned to optimize spend and manage the delicate balance between cost, performance, and risk.

Understanding AI Cost Categories

AI costs generally fall into two categories:

Direct costs. These include models, data, and infrastructure — the core technologies needed to build and run AI solutions.
Operational costs. These cover the overhead of running AI at scale, such as governance, business transformation, and skills development.

Each category involves trade-offs. Here are a few key levers for consideration:

Choosing the right model is the quickest way to balance performance and cost. Mature organizations regularly evaluate and swap models, as model quantity and processing profiles can significantly impact expenses.
Data is often the largest cost driver, with AI workloads doubling storage needs. Agentic systems generate vast logs and metadata. Optimize by using efficient formats, compression, tiered storage, and eliminating redundant or abandoned data.
Infrastructure choices affect both costs and performance. Cloud offers flexibility and access to GPUs but comes with less predictable costs, and on-premises provides predictability but high up-front investment. Workload placement should also factor in latency, performance, and data sovereignty.

The Bottom Line

As genAI adoption scales, so will costs — often exponentially. GenAI introduces new cost levers and operational complexities that differ fundamentally from traditional software. Staying ahead requires continuous fine-tuning of your AI cost levers: models, data, infrastructure, and operations.

Want to learn more? Check out our report, AI Cost Optimization: The Why, What, And How.

Need tailored guidance? Speak with our analysts: Michele Goetz (AI/data), Tracy Woo (FinOps), or Charlie Dai (AI cloud).



Source link

Tags: cheapHeresIsntSMARTerspend
ShareTweetShare
Previous Post

What the Volatility Index Can Tell You About the Economy and Markets

Next Post

Costco to Restore Key Benefit for Executive Members at Select Stores

Related Posts

edit post
1 Stock to Buy, 1 Stock to Sell This Week: Meta Platforms, Starbucks

1 Stock to Buy, 1 Stock to Sell This Week: Meta Platforms, Starbucks

by TheAdviserMagazine
October 26, 2025
0

Fed policy decision, ‘Mag 7’ earnings, and Trump-Xi meeting will be in focus this week. Meta is expected to report...

edit post
Where We Go Next After NY Climate Week

Where We Go Next After NY Climate Week

by TheAdviserMagazine
October 24, 2025
0

The 2025 New York climate week spurred discussions. What stood out for us was that everyone’s takeaways were rooted in...

edit post
What I’ve Found So Far

What I’ve Found So Far

by TheAdviserMagazine
October 24, 2025
0

Since July, I’ve attended the Hubspot Inbound, Oracle AI World, and SupportLogic’s Enterprise AI for CX conferences. I’ve also been...

edit post
California’s TFAIA Act Revives Conversation On AI Regulations

California’s TFAIA Act Revives Conversation On AI Regulations

by TheAdviserMagazine
October 24, 2025
0

Defying the odds and lobbying pressure, California’s SB 53, known as the Transparency in Frontier Artificial Intelligence Act (TFAIA), is...

edit post
Risk Lessons From The Louvre

Risk Lessons From The Louvre

by TheAdviserMagazine
October 24, 2025
0

On a Sunday morning in Paris, a small crew arrived outside the Louvre’s Galerie d’Apollon in a truck equipped with...

edit post
Retailers: Holiday 2025 Is Here!

Retailers: Holiday 2025 Is Here!

by TheAdviserMagazine
October 24, 2025
0

To help retailers and brands prepare for the 2025 end-of-year shopping season, we recently published our annual guide to the...

Next Post
edit post
Costco to Restore Key Benefit for Executive Members at Select Stores

Costco to Restore Key Benefit for Executive Members at Select Stores

edit post
GameStop shares tank as retailer reveals convertible debt offering, trading cards plan

GameStop shares tank as retailer reveals convertible debt offering, trading cards plan

  • Trending
  • Comments
  • Latest
edit post
77-year-old popular furniture retailer closes store locations

77-year-old popular furniture retailer closes store locations

October 18, 2025
edit post
Pennsylvania House of Representatives Rejects Update to Child Custody Laws

Pennsylvania House of Representatives Rejects Update to Child Custody Laws

October 7, 2025
edit post
What to Do When a Loved One Dies in North Carolina

What to Do When a Loved One Dies in North Carolina

October 8, 2025
edit post
Another Violent Outburst – Democrats Inciting Civil Unrest

Another Violent Outburst – Democrats Inciting Civil Unrest

October 24, 2025
edit post
Probate vs. Non-Probate Assets: What’s the Difference?

Probate vs. Non-Probate Assets: What’s the Difference?

October 17, 2025
edit post
California Attorney Pleads Guilty For Role In 2M Ponzi Scheme

California Attorney Pleads Guilty For Role In $912M Ponzi Scheme

October 15, 2025
edit post
High Dividend 50: Blue Owl Capital Corporation

High Dividend 50: Blue Owl Capital Corporation

0
edit post
The Core Of The Peace Proposal

The Core Of The Peace Proposal

0
edit post
Is It OpenSea or Blur?

Is It OpenSea or Blur?

0
edit post
How Many People Actually Work for the U.S. Government? The Latest Shock Figure & What It Means for You

How Many People Actually Work for the U.S. Government? The Latest Shock Figure & What It Means for You

0
edit post
Coforge shares rally 6% after Q2 net profit rockets 86% YoY. Should you buy, sell or hold?

Coforge shares rally 6% after Q2 net profit rockets 86% YoY. Should you buy, sell or hold?

0
edit post
Asked on Reddit: Should I Pay Off Loans or Save?

Asked on Reddit: Should I Pay Off Loans or Save?

0
edit post
The Core Of The Peace Proposal

The Core Of The Peace Proposal

October 27, 2025
edit post
Coforge shares rally 6% after Q2 net profit rockets 86% YoY. Should you buy, sell or hold?

Coforge shares rally 6% after Q2 net profit rockets 86% YoY. Should you buy, sell or hold?

October 26, 2025
edit post
Milei’s party on track to win Argentina election in big comeback

Milei’s party on track to win Argentina election in big comeback

October 26, 2025
edit post
HSBC to recognize .1 billion in provision after court ruling in Madoff case

HSBC to recognize $1.1 billion in provision after court ruling in Madoff case

October 26, 2025
edit post
Accel and Prosus team up to back early-stage Indian startups

Accel and Prosus team up to back early-stage Indian startups

October 26, 2025
edit post
What Saudi Arabia and Bangladesh can teach Silicon Valley

What Saudi Arabia and Bangladesh can teach Silicon Valley

October 26, 2025
The Adviser Magazine

The first and only national digital and print magazine that connects individuals, families, and businesses to Fee-Only financial advisers, accountants, attorneys and college guidance counselors.

CATEGORIES

  • 401k Plans
  • Business
  • College
  • Cryptocurrency
  • Economy
  • Estate Plans
  • Financial Planning
  • Investing
  • IRS & Taxes
  • Legal
  • Market Analysis
  • Markets
  • Medicare
  • Money
  • Personal Finance
  • Social Security
  • Startups
  • Stock Market
  • Trading

LATEST UPDATES

  • The Core Of The Peace Proposal
  • Coforge shares rally 6% after Q2 net profit rockets 86% YoY. Should you buy, sell or hold?
  • Milei’s party on track to win Argentina election in big comeback
  • Our Great Privacy Policy
  • Terms of Use, Legal Notices & Disclosures
  • Contact us
  • About Us

© Copyright 2024 All Rights Reserved
See articles for original source and related links to external sites.

Welcome Back!

Login to your account below

Forgotten Password?

Retrieve your password

Please enter your username or email address to reset your password.

Log In
No Result
View All Result
  • Home
  • Financial Planning
    • Financial Planning
    • Personal Finance
  • Market Research
    • Business
    • Investing
    • Money
    • Economy
    • Markets
    • Stocks
    • Trading
  • 401k Plans
  • College
  • IRS & Taxes
  • Estate Plans
  • Social Security
  • Medicare
  • Legal

© Copyright 2024 All Rights Reserved
See articles for original source and related links to external sites.