Why does cheaper AI lead to more token use under Jevons paradox?

Short answer: Jordan Metzner says as tokens get cheaper, consumption goes up, a classic Jevons paradox: he builds more and crazier apps. Emanuele Melis says GitHub had to limit project creation because of the flood of new projects.

Watch this answer from Episode 46

Watch this answer from Episode 46 (starts at 15:36) · Episode 46 notes and transcript

What was said on Built This Week

From Episode 46: We Tested Claude 4 Fable and Deployed Enterprise Agents Without a Single Data Migration, starting at 15:36.

Jordan Metzner [15:35]: Yeah. For sure. Okay. Cool. Well, again, as it was a big week in tech and in news and AI and everything else, should we jump into the news really quickly, Sam, and kinda roll into that?

Sam Nadler [15:45]: Claude announced Fable. There's been tons of articles on it. We shared one before the call. We touched upon, it's been, I think, thirty six hours, maybe forty eight hours. I barely used it, so I don't have a strong opinion. But, I you know, every week there seems to be significant step level upgrades in the model. And, what's it what are your all your thoughts on, what's to come and what this means for the space?

Jordan Metzner [16:12]: Oh, I'll go first. Was an email from the economist at a leading alternative asset manager today saying that, basically as tokens per token getting cheaper, token consumption's going up, and classic Jevons paradox here, and I think that's what's going on, you know. I mean, as I get more tokens, I build more apps, I build crazier apps, I have more ideas for apps to build. I don't know. I know my token consumption over time is going 100 x

Sam Nadler [16:32]: Make better.

Jordan Metzner [16:34]: 100 x my design. Yeah. You got it. You got it. I mean, I should try a thousand x or 10,000 x. But yeah, I think and it gets more and more fun. Know, I remember using cursor. I mean, it maybe was a year ago or so, and it would make these like markdown notes and then every markdown note had a random number to it and then it wouldn't even be in sequential numbers. And you'd be like, oh man, it has no context. And now I just I go watch half a soccer game and I'm back. So, it's only getting better and better. Hopefully, it'll keep getting cheaper and cheaper. And, yeah, it's getting more and more fun and more productive, at least from my perspective. And Emanuele, how about for you? I mean, as an engineering team.

Emanuele Melis [17:16]: It's it's crazy for me to see how quick and how much we have evolved in the last eighteen months. And I made a bet, that was May last year, that I would try to go my career engineering career, not looking at a line of code anymore. It didn't quite turn out

Sam Nadler [17:32]: How's going?

Emanuele Melis [17:35]: I still have to make a code for the most part. However, if you said cursor a year ago or the tools that we had a year ago, I think Claude launched a year and some months ago as well. And if you Claude Code. Right? And so, like, how wild is it that today you have Fable when you can give it a backslash command, you need give it go and just go do something and you keep iterating until you do that. Right? And Codex has the browser view. So if you're doing web apps, it will just build a code, go and click on the UI, and keep going and doing until it does what it needs. It's it's to me personally, an engineer, it's mind blowing. And, like, to your earlier point, we'll just use more tokens. Right? People will have more ideas, more things to play with. The amount of throw away projects that get generated. There was a statistics on GitHub, which is the world's repository for all the code. Right? That they actually had to put a limit on how many projects can be created because they were just being overwhelmed by all this by the code where there were new projects that were coming out that just didn't have capacity. Right? Yeah. Well, you would Which like definitely wasn't the case.

Jordan Metzner [18:42]: A repo to GitHub has like a marginal cost of zero, but then, people were pushing so many changes to every repo times multiples. Actually, it's not zero. It's nominal, but not zero. Right? Yeah.

Emanuele Melis [18:55]: So many. I think it was around, like, 25,000 that they had a limit

Sam Nadler [18:58]: That was like, how do you even get to 25,000 feet?

Emanuele Melis [19:02]: That that's just so much. But then, I guess, as you said, it's so quick to iterate now and so fast to get a prototype out. And half of those prototypes are more than a prototype. Something very cool that a CRM project manager do recently, they had Claude Fable that effectively listened to the transcript of their conversation as they were live. So effectively, they were discussing with the engineers and Claude Fable Deployed built in live just by listening them talking to the com into the conversation, which is that would never be possible. Right? So definitely fun times for all the builders out there. There are a lot of possibilities to build.

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