Time for an updated Talent Strategy - Its not AI vs Humans any more

 When cloud computing started, most companies used to have their own servers, a backup site, and network engineers. They came and told us that we dont need to put money on this much infra and specialised talent. Cloud really was a small fraction of the cost and soon, it was impossible for us to convince clients to have their own servers for their work. As Saas happened, on prem servers also became pointless. 

That was 20 years ago. 

However, as soon as critical mass was reached, we saw a spike in pricing. Today, it is legit cheaper for a client to have a small native data center for their on prem apps (which, also, is rare). 

BUT by now, the network engineers who could take care of small server setups are gone. The server market is different. So, basically, we are in monopolistic pricing and we can choose between the oligarchs. 

The same thing I envisage for the AI market. Currently, the models are at 20USD per month per user, making them significantly cheaper than human talent. This means that we are obliterating (not diminishing, obliterating) humans with skill. 

As soon as critical mass is reached, this pricing will go from 20 to 40 USD, and within two years, we are looking at at least a 10x price ramp up, with similar monopolistic pricing. 

My estimate is that the first price shocker will come by Oct 2026. Marginal price increase, throttling the free layer enough to make it unusable. 

So, as CEOs, i think we need to have a talent strategy - one that includes human and AI talent and prepares for a prudent mix.

We need a talent strategy. Manpower planning that includes AI talent. We need to do our talent costing differently. Is the subscription cost of an AI agent personnel cost or IT cost? This number is reported in annual reports and honestly, I am conflicted. I think that if a subscription is being used to do work that would otherwise have been done by a human, it should be personnel cost. Also, our Talent Planning needs to include work being done by AI. In some cases, it will lead to an absolute reduction in human talent. In most cases, it will lead to doing more with fewer human employees. 

What is your view?