Microsoft CEO Says Outcome Based Pricing Fails When Customers See Value

What was said

"Most people love outcomes until they have an outcome, because once you have an outcome, it's like giving away royalty. I've talked to customers who love outcome-based pricing and I say, I'm all in until they, oh my God, like, what are you talking about? You're sharing in my outcome? No, no, no. I want you to go back to per-user pricing."

Nadella revealed a paradox in AI pricing models where enterprise customers enthusiastically support outcome-based pricing until they actually achieve valuable results, at which point they resist sharing those outcomes with vendors. This observation suggests subscription and consumption-based models will persist despite industry discussion of value-based alternatives.