By Divya Bhati
Publication Date: 2026-05-26 10:16:00
The promise of AI in 2025 was simple: adopt it and you will save on operational cost. This would be due to two reasons. One, AI will cost less than what a company has to pay to a human employee. And two, AI will boost productivity by 10X or something like that.
The reality of AI in 2026 is simple. Instead of productivity going up by 10X it is the cost of AI that has risen up sharply. Some industry insiders have even started suggesting that it is cheaper to pay for a competent human employee instead of deploying Claude. The cost question around AI has become so stark that even companies like Microsoft and Uber are finding it difficult to justify their AI expenses.
Last week a few reports highlighted the supposed misalignment in AI benefits and costs that companies have started to notice. At Microsoft, the management has asked thousands of engineers to stop using Claude Code and instead move to an internal AI tool. The deadline to do so is June 30. While the company has not publicly…
