alt Hacker NewsWhy does Claude charge 10x for API, compared to subscriptions? They're not a monopoly, so one would expect margins to be thinner.
Why does Claude charge 10x for API, compared to subscriptions? They're not a monopoly, so one would expect margins to be thinner.
Monopoly isn't the only thing that allows you to charge large margins.
API inference access is naturally a lot more costly to provide compared to Chat UI and Claude Code, as there is a lot more load to handle with less latency. In the products they can just smooth over load curves by handling some of the requests slower (which the majority of users in a background Code session won't even notice).