Companies that Charge for Measurable Results will Dominate their Industry
How AI Innovators Are Reshaping Business Models
The businesses that survive the AI era won’t be those selling access or services by the hour. They’ll be those guaranteeing results. The shift to outcome-based pricing isn’t just a trend — it’s an inevitability.
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In 1998, Microsoft was an unstoppable force. Its Windows operating system dominated the market, and its strategy was simple: crush competitors by bundling software into its ecosystem. If a startup dared to challenge Microsoft, all it took was integrating a similar feature into Windows for free, and the competitor was dead on arrival. Netscape learned this the hard way when Internet Explorer came bundled, rendering the standalone browser business model obsolete.
However, in the shadow of Microsoft’s dominance, a small company called Google was about to rewrite the rules of the game. Instead of charging users for software, Google introduced a radically different approach — ads that monetised search queries, charging for outcomes. Microsoft couldn’t compete by simply bundling an ad-driven search engine into Windows because its entire business was built on per-seat licensing fees. The business model, not the technology, was the actual disruption.
History Isn’t Simply Rinse-and-Repeat
Fast-forward to 2025, and we see history repeating itself. This time, OpenAI, Google, and other tech giants wield dominance. Their business model? AI subscriptions. Pay $20 a month for GPT-4, pay for API usage, and pay for enterprise plans. It’s software as a service (SaaS) dressed in new clothes.
Do you remember when SaaS was an innovator’s game? In the early 2000s, companies like Salesforce disrupted traditional enterprise software by shifting from one-time licensing fees to monthly subscriptions. Today, we’re at another inflection point — where AI startups are beginning to question whether fixed subscriptions even make sense in an era of dynamic, outcome-driven AI interactions.
The Death of Fixed Pricing and the Rise of Outcome-Based Models
A seismic shift is underway, echoing what Google did to Microsoft: outcome-based pricing will replace static subscription fees. Instead of paying for access to AI tools, businesses will pay for successful outcomes AI delivers.
Take Intercom’s Fin AI chatbot as an early example. Instead of charging customers a monthly fee, Intercom now offers pricing per successful support resolution. If the AI doesn’t resolve an issue, the company doesn’t pay. This aligns incentives perfectly — customers only spend money when they realise value.
Similarly, Zendesk is introducing a model where customers pay per resolved customer service case. The shift is evident: AI is evolving into a results-driven service, not a fixed-cost tool.
This new paradigm forces companies to rethink monetisation strategies. What happens when AI models improve at solving problems and eliminating the need for prolonged usage? Traditional subscription models rely on sustained engagement, but an AI agent that completes tasks efficiently might reduce user interaction time. This is where pay-per-outcome models thrive.
Subscription Fatigue and the Growing Distrust of Long-Term Commitments
There’s another reason this shift is inevitable: subscription fatigue. Consumers and businesses alike are overwhelmed by the sheer number of services demanding a monthly or annual fee. Almost every AI startup pitches the same model—a monthly payment with a discount for a yearly commitment.
It’s a familiar promise: “Trust us, it will be awesome. You’ll be so happy you subscribed for a year.” But a lot can happen in a year. A month after you’ve locked yourself into an annual plan, a better solution emerges, leaving you with an outdated choice. Commitment-based pricing feels misaligned with AI’s rapid evolution in an industry moving at breakneck speed.
Customers are increasingly wary of these commitments. The alternative? A model where you only pay when tangible value is delivered. Outcome-based pricing is not just a new strategy — it’s a correction to a pricing model that no longer makes sense in an era where solutions evolve weekly, not yearly.
The World of Outcome-Based Everything
What happens when outcome-based pricing doesn’t just apply to AI but to everything? Imagine a world where services are no longer priced based on hours worked but on results achieved.
- Legal services: Instead of paying a lawyer by the hour, you pay only if your case is won or settled favourably.
- Healthcare: Instead of paying for procedures, you pay only if the treatment improves your health.
- Marketing: Agencies charge not for campaigns run but for measurable revenue growth.
- Education: Universities move beyond tuition fees and charge based on students’ career success post-graduation.
- Transport: Pay for on-time arrival or delivery.
This future is “Simultaneously Exhilarating and Terrifying©”.
It eliminates inefficiencies, aligns incentives, and demands full accountability — but it also forces industries to redefine their value propositions. Businesses that once relied on effort-based billing will struggle, while those that guarantee measurable results will dominate.
Why Incumbents Will Struggle to Adapt
This shift creates an asymmetric advantage for startups. Why? Because incumbents resist business model changes that threaten their revenue streams.
Just like Microsoft couldn’t pivot away from its Windows-based licensing model overnight, today’s major AI companies — OpenAI, Google, and Anthropic — are deeply tied to subscription-based SaaS structures. Their enterprise contracts, revenue projections, and investor expectations are all built around predictable monthly recurring revenue (MRR).
For an AI-first startup, counter-positioning against these giants means embracing what they fear and gaining a significant advantage: revenue models that scale with customer success, not static subscriptions.
This should inspire startups to take bold steps and experiment with innovative new business models.
Lessons from the Wright Brothers: Permissionless Innovation Wins
History also tells us that radical shifts in how things are built — not just how they’re priced — define the winners. Mike references this in Pattern Breakers, drawing parallels to the Wright brothers.
In 1903, while credentialed engineers debated the physics of flight in academic journals, two bicycle mechanics in Ohio were building planes. When the New York Times published an article titled “Flying Machines That Won’t Fly,” it was just 69 days before the Wright brothers proved them wrong. Theorists remained trapped in old-world assumptions, while the Wrights took action and iterated in real-time.
Startups today face a similar opportunity. The legacy players — big tech and entrenched SaaS incumbents — are locked in a mindset optimised for old-world pricing models. But the true pioneers are moving fast, experimenting with new business models that incumbents can’t easily copy.
The Shift in Knowledge Work: From Sculpting to Gardening
This transformation isn’t just about how AI is sold — it’s about how we work.
The traditional model of knowledge work resembles sculpture: You manually shape every piece of information, painstakingly refining it. AI transforms work into gardening: You cultivate the right conditions, and intelligence flourishes autonomously.
Consider AI-powered software development. Engineers using agentic AI tools like Devin and Cursor don’t “write code” in the traditional sense. They orchestrate the AI’s innovation and problem-solving capabilities. Developers entering the field today don’t see AI as a tool — they see it as a vehicle to deliver great outcomes.
Rule of Three Summary
Every major technological shift creates new rules. Some companies adapt, others die. Microsoft failed to stop Google’s ascent because it tried to fight the future with old tools. Likewise, today’s AI startups have a choice: build for the world as it was or for the world that’s coming.
- The Subscription Model is Crumbling — Customers are exhausted from commitment-based pricing, and AI solutions evolve too fast for year-long subscriptions to remain viable.
- Outcome-Based Pricing Will Define the Winners — The future belongs to companies that charge for value delivered, not access granted.
- Incumbents Will Struggle to Pivot — Their business models, revenue forecasts, and investor expectations tie them to outdated pricing structures, creating opportunities for startups to disrupt them.
History isn’t just worth studying — it’s a blueprint for what comes next. The winners of the AI era will be those who take the lessons of the past and apply them intelligently to the future.
This future is “Simultaneously Exhilarating and Terrifying©” is Copyright Greg Twemlow
About the author:
📌 Greg Twemlow, Founder of XperientialAI & Designer of the Fusion Bridge
XperientialAI: AI-powered learning for leaders, educators, and organisations.
Fusion Bridge: My latest work — building AI-enabled frameworks for innovation & leadership.
🌎 Read more of my 300+ articles → https://gregtwemlow.medium.com/
📧 Contact: greg@xperiential.ai or greg@fusionbridge.org
