Why Selling AI Like Electricity Misses the Point
Why Selling AI Like Electricity Misses the Point
Everyone wants to be the "AI utility" - sell tokens by the million, charge per API call, become the commodity infrastructure layer. This framing borrows from electricity, and it is wrong.
Electricity Does Not Understand Your Workflow
When you plug a lamp into the wall, electricity does not know or care what the lamp does. It delivers watts. The value is in the device, not the power source.
AI is fundamentally different. AI can understand what you are doing, why you are doing it, and how you have done it before. Treating it as a dumb utility - input tokens, output tokens, bill monthly - throws away the most valuable property of the technology.
The Workflow-Specific Opportunity
The real value of AI is not generic intelligence. It is intelligence applied to your specific context:
- Your codebase - an agent that knows your repo structure, coding patterns, and deployment process
- Your email patterns - an assistant that knows which emails you always reply to and which you archive
- Your design workflow - a tool that knows your brand guidelines, component library, and review process
- Your data pipeline - an agent that understands your schema, your transforms, and your quality checks
This context makes AI exponentially more useful than a generic API call.
What This Means for Products
Products that win will not be the cheapest per-token. They will be the ones that:
- Accumulate context - learn from every interaction and get better over time
- Persist memory - remember what worked last week and apply it today
- Integrate deeply - connect to the actual tools and data where work happens
- Automate specifically - solve your exact workflow, not a generic approximation
The Pricing Implication
If AI is a utility, you compete on price. If AI understands workflows, you compete on value delivered. The second model is better for everyone - builders capture more value, and users get tools that actually solve their problems instead of providing generic capabilities.
Fazm is an open source macOS AI agent. Open source on GitHub.