Ricardo Tavares

August 26, 2023

Generative AI and the pricing of value in hours of work

If you take it at face value, hourly-based billing makes no sense for anyone. If you can do it well and do it fast, why are you being discouraged from delivering it quickly? You should be paid more for solving it better and faster. But if hours are just an abstraction, we can assume they're an affordance for clients to negotiate down the price. It's there for them to say that they don't think this thing needs that many "hours". It’s leverage they can use to try to get the thing done for cheap while also wanting it done quickly.

Clients don’t want to just buy pristine hours of uninterrupted time, they also want to be able to cut through whatever you’re doing and get an issue solved in an instant. More accurately, clients are purchasing some amount of your professional attention and responsibility. But what everyone actually wants is for as much value as possible to be generated. And “hours” is just some unit of work used to negotiate over how that value gets distributed.

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The gain in popularity of generative AI is helping us see this more clearly. You can produce a lot of text, images, music, and even video very quickly. The price for just having some piece of generated media is going to zero, what matters is the value it can come to aggregate. We can now imagine that, if you develop some mastery over these tools, producing the thing itself can almost become instantaneous. What the process will always require is paying attention to the thing and taking responsibility for how it turns out. And beforehand, you need to have made an investment in aligning the right data with the right model and the right prompt. 

The most optimistic promise of generative AI is that more and more people become this archetype of the person who is so experienced and well-educated that with the right tools they can create immense value in only a few seconds. And that prospect is not above being negotiated right now, we can already hear the "it only took X seconds, why should I pay you Y?" argument being repeated. But the thing about repeatable arguments is that they can also be automated and AI should be coming for everyone. It should be pushing us to become more human and to deepen our empathy for one another, it's pointing us towards domains that are beyond automation. Attention, responsibility, being aware of what value we're producing and how that gets negotiated. Human alignment comes before having autonomous machines that align with us. 


About Ricardo Tavares

Creates things with computers to understand what problems they can solve. Passionate for an open web that anyone can contribute to. Works in domains where content is king and assumptions are validated quickly.

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