Karp on AI Pricing and Profit Models
eliano · x · 2026-07-19
Palantir CEO Alex Karp argues that charging LLMs by the token contradicts the pricing logic of "high-value software": if AI truly generates massive value for clients, it shouldn't be sold merely as tokens, but rather through value-sharing or models tied closer to economic gains.
He adds that many AI companies only appear financially stable because clients aren't paying the true cost. Palantir's real revenue drivers are twofold: the application-layer ontology, and compute. Karp emphasizes they can build frontier applications as powerful as frontier models, but they refuse to hand over their business alpha to external model providers.
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