Most companies are flying blind on AI spending
Quick Answer
A KPMG survey reveals that only 26% of companies have complete visibility into their AI spending, indicating a significant gap in financial oversight.
Quick Take
This lack of transparency could hinder strategic investments and operational efficiency in AI initiatives, affecting overall business performance.
Key Points
- Only 26% of companies track AI costs effectively.
- Lack of visibility may hinder strategic AI investments.
- Financial oversight gaps could impact operational efficiency.
- Companies risk poor decision-making without cost transparency.
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~1 min readOnly 26 percent of companies have full visibility into their AI costs, a KPMG survey finds.
The shift to token-based billing for AI services is putting finance departments in a tough spot, the Wall Street Journal reports. According to a yet-unpublished KPMG survey, just 26 percent of companies have full visibility into their AI spending. Half have limited oversight, and 22 percent have no transparency at all - or only find out what they've used after the bill arrives.
"It's a new resource that needs to be managed that didn't exist quite that way, and we're seeing exponential growth," Steve Chase, KPMG's global AI lead, told the WSJ.
KPMG is already working with several companies that burned through their annual token and cloud budgets within just a few months. One client saw a sixfold spike in token usage. Gil Luria, head of technology research at D.A. Davidson, expects the problem to hit more companies this year: "A lot of CFOs are going to see their Anthropic bill and freak out this quarter."
Analysts and executives the WSJ spoke with are drawing parallels to the pandemic-era cloud boom. Back then, companies poured money into cloud infrastructure, only to slash spending shortly after.
We took a closer look at why tokens are becoming a key business metric and how companies can prepare in our latest Frontier Radar #3.
— Originally published at the-decoder.com
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