Usage-Based Pricing

A pricing model where the buyer pays based on consumption (events, API calls, gigabytes, transactions).

Usage-based pricing aligns vendor revenue with customer value but makes budgeting harder. Buyer protection includes a soft cap (alerting before threshold), a hard cap (no overages without explicit approval), and a per-unit price lock for the term. Vendors that use this model heavily (Datadog, Snowflake, Twilio) often surprise buyers with mid-year cost spikes; tracking usage in a finance integration prevents that.