PeterLindstrom
But if your plans' prices have stayed the same, then adding AI has reduced your profits.
No, it has been profitable for us because we now appeal to a wider range of customers interested in the technology that would not have otherwise considered Kagi. Existing cusomters get more value out of their subscription, increasing the likelihood that they recommend it to peers as well, and decreasing the risk of them churning away because of something we do not offer vs competitors.
AFAIK it can be surprisingly costly to work with Cloud AIs these days. A little back and forth can cost a few dollars, right?
Not necessarily, no. As the industry has matured there are some extremely cheap and high quality models available. There are only a few ranges of models that are as expensive as you imply. Majority of threads are just a few cents on the dollar.
So how were you able to keep your prices the same, while adding AI into the mix?
We have a very simple limit system: If you spend as much AI usage as you have paid for your plan, then we lock usage until your plan renews, or you have the option to renew early. It enforces that we, at the very least, are not losing money on someone using AI heavily. In reality very few people hit this limit.
And since AI adds costs on your end, did it not result in compromising quality already? 🙂
I don't quite folow. When you search, no AI is run. There is no AI cost to Kagi when you search. The price of the plan is based off our search API costs, so if you wanted a cheaper plan then we would have to use fewer sources and offer a lower quality experience. That is all there is to it. And we would rather add value to your plan by adding more features (Domain blocking, lenses, ...) to make it worth your subscription money than compromise on this.
