What value does generative artificial intelligence (GenAI) generate? That might be a trillion-dollar question. To explore the value of GenAI – and decide which pricing model to use – you should:

• Get crystal clear on what drives value and differentiation. The more differentiated the offer (in terms of performance, proprietary data, and domain specificity), and the more it augments the end user, the more you can price to value and use a subscription or outcome-based model.
• Go deep on your economics. The cost-to-serve profile of GenAI-based solutions can vary dramatically, depending on the underlying LLM, user profile, and evolution over time.
• Play the right pricing game. Highly differentiated offers with few vendors and many customers fit the Value Game (one unique offer) or the Choice Game (multiple players with segmented customer bases).

Pricing decisions will determine how quickly the adoption accelerates, who benefits, how much money there is to reinvest, and even the future of human-machine interaction.