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AI Economics8 min read

The Hidden Cost of AI Observability

Monitoring AI systems costs 15-25% of your inference budget. Budget for it.

By Richard Ewing·

Observability Is Not Free

Most teams budget for inference costs and forget observability. Real costs: logging/storage (5-10% of inference), evaluation runs (5-10%), drift detection (2-5%), A/B testing infrastructure (3-5%).

Total observability overhead: 15-25% of inference costs. At $10K/month inference, budget $1.5-2.5K for observability. Cutting this budget leads to undetected model degradation.

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Published Work

This article expands on ideas from my published work in CIO.com, Built In, Mind the Product, and HackerNoon. View published articles →

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Richard Ewing

The Product Economist — Quantifying engineering economics for technology leaders, PE firms, and boards.