Estimate where AI spend comes from by separating input, cached input, output, and latency-sensitive work.
Start with the ledger AI cost is not one number. It is a mix of fresh input, cached input, output, and delivery mode. A team that skips this view usually debates the “best model” while paying for the same bulky prompt over and over. The four controllable levers Token economics: output is usually more expensive than input, so tighter formats often save more than heroic prompt trimming. Model routing: send easy work to smaller models and hold stronger models for genuinely uncertain tasks. Prompt caching: stable prefixes, system instructions, and reusable context get cheaper only when they stay stable enough…
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