The End of Seat-Based Pricing: Usage Models Explained

Seat-based pricing was invented for a world where software ran on individual PCs and licenses were physical. In the AI era, it makes no sense. A company shouldn't pay 10x more because it has 10x more employees. Usage-based pricing is winning — here's why it's better for everyone.

The Problem with Per-Seat Pricing

Seat-based pricing creates perverse incentives on both sides. Vendors are incentivized to maximize seat count, not value delivered. Customers game the system by sharing logins, creating "viewer" roles, and avoiding provisioning new users to save money. Both behaviors undermine the product.