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Home Technology & Industry AI

Why Enterprise AI Costs Scale Backwards

By Martin Lucas is founder and CEO of TMX Group and inventor of SDCI™

SVJ Thought Leader by SVJ Thought Leader
June 29, 2026
in AI
0
Why Enterprise AI Costs Scale Backwards

The default assumption when buying any infrastructure is that it gets cheaper per unit at scale.

Cloud compute. Storage. Bandwidth. CDNs. SaaS seat licenses. The entire logic of enterprise procurement is built on volume discounts, usage thresholds, and economies of scale.

AI infrastructure breaks that assumption.

It is the only major enterprise infrastructure category where unit economics get worse as you use it more.

How every other infrastructure behaves

Run a database harder, the marginal cost per query falls. Add more users to a SaaS contract, the per-seat price drops. Move more traffic through a CDN, the per-gigabyte cost compresses.

Every dollar of additional spend yields a slightly cheaper marginal unit. That is how enterprise procurement teams are trained to think. That is the entire foundation of “build for scale” as a financial principle.

AI does not work this way. It is not that the discounts are smaller. It is that the curve goes the wrong direction.

Why the curve inverts

Probabilistic generation has no structural caching layer that improves with usage.

Run a query a thousand times. Cost: a thousand units. Run it a million times. Cost: a million units. The system is not getting better at answering. It is not learning anything across queries at the architectural level. It is just generating from the same probability distribution again and again.

Worse: as your enterprise deploys more use cases, the context required for each query gets larger. The system has to reconstruct more state every time. Larger context windows. More elaborate prompt engineering. Heavier retrieval-augmented overhead just to keep outputs reliable.

Costs scale linearly with usage. Reliability scales sub-linearly. The unit economics drift apart.

This is the inversion. Volume increases the cost-per-quality ratio rather than decreasing it.

What this does to your three-year AI plan

Every enterprise AI roadmap drafted in 2024 is wrong by 2026 for the same reason.

The plan assumed scaling efficiencies that the architecture cannot deliver. Year one budget projections assumed cost compression at higher utilisation. Year two budgets assumed economies of scale would compensate for expanded use cases. Year three budgets assumed the entire deployment would be operating at marginal cost levels comparable to other enterprise infrastructure.

None of that has happened.

Most enterprise AI bills are now between 2.5x and 5x year-one projections. Some are higher. The CFO conversation has shifted from “how do we capture more AI value” to“how do we cap the spend without abandoning the use cases.”

That is the inversion arriving in your P&L.

How deterministic architecture reverses the curve

Pre-compiled, structured cognitive intelligence behaves like every other piece of enterprise infrastructure. It gets cheaper at scale.

Build the artefact once. Execute against it forever.

The first query against a new structured cognitive workflow has the highest cost — establishing the artefact, indexing the semantic layer, structuring the reasoning chain. Every subsequent execution is a fraction of that.

The hundredth query is cheaper than the first. The ten thousandth query is cheaper than the hundredth. The cost curve compresses with usage.

This is what enterprise procurement is built around. This is what makes infrastructure spend rational.

The architecture decision inside the cost decision

Every enterprise that has run AI at scale for more than eighteen months is now sitting inside a quiet structural problem.

The technology works. The use cases are real. The value is being delivered.

But the cost curve is wrong.

You can throw more capital at it and accept the inversion as a cost of doing business. Many enterprises are doing exactly that, telling themselves it will normalise once vendors mature their pricing. It will not. The curve is inverted because the architecture is inverted. Vendor pricing is downstream of architectural reality.

Or you can put a deterministic cognitive layer in front of the probabilistic substrate and reverse the curve.

The deterministic layer handles the structured reasoning that should never have been recomputed. The probabilistic layer handles the open-ended generation that benefits from sampling. The bill stops scaling backwards.

The bottom line

You can either build infrastructure that gets cheaper as you use it more — which is what infrastructure is supposed to do — or you can keep buying the only category of enterprise software where scale punishes you.

That is the choice on the table for every CFO and CTO right now.

Most haven’t named it that clearly yet. But every quarter the curve gets worse.

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