With the increasing role of artificial intelligence in software development, Indian IT services firms are rethinking their pricing strategies. Companies are transitioning from traditional hourly billing to more predictable models that include subscriptions, prepaid credits, and usage-based rate cards. This shift is driven by client demand for greater cost predictability and outcome-oriented pricing in AI-driven projects.
In recent months, several firms have begun to implement these new billing structures. Notably, EPAM Systems has started incorporating AI token costs into its deal frameworks, while Tech Mahindra is exploring pricing linked to token consumption. Similarly, Cognizant Technology Solutions has introduced a rate card specifically for AI usage, and Coforge has launched a fixed monthly subscription for its AI services.
These innovative pricing models reflect advancements in AI technology, which now allows for the automation of entire processes, such as marketing campaign creation and weather prediction, rather than just task automation.
Cognizant is now tracking AI usage through token consumption, with clients paying for tokens that represent small units of text processed by AI tools. This model allows for a blended pricing approach that accounts for both human and digital efforts. According to Cognizant's CEO, the company is now offering tokenized rate cards that vary based on the level of human involvement in the work.
Clients are increasingly looking for bundled deals that simplify billing. As noted by Sushovon Nayak, an analyst at Anand Rathi Institutional Equities, this trend allows IT vendors to manage AI usage and costs more effectively, ensuring that clients receive predictable pricing.
Coforge's subscription model, termed 'AI Mod Squads,' offers clients access to a variety of pre-built AI agents for a monthly fee. This model promotes flexibility, allowing enterprises to pay only for the AI services they consume.
Meanwhile, LTM Ltd is set to introduce a credit-based system where clients purchase credits that are deducted as they utilize AI tools. This approach is designed to link pricing to the outcomes delivered rather than the effort expended.
While Cognizant, Coforge, and LTM have adopted these new pricing strategies, they have not disclosed specific figures regarding their AI revenues. However, Cognizant reported $21.1 billion in revenue for the previous year, with LTM and Coforge also showing significant growth.
