"According to a survey of 350 execs who work for software vendors, conducted by PwC UK and billing infrastructure biz m3ter, 44 percent of UK business leaders say they have trouble measuring the consumption of usage-based software."
"M3ter claims that between 4 and 7 percent of annual recurring revenue is potentially at risk from unsophisticated bookkeeping."
"The monetization opportunity exists, but it is clear that converting AI capability into sustainable, auditable revenue remains a challenge."
"A useful comparison is with the cloud infrastructure sector... they had similar challenges and over time they developed greater transparency, via both better pricing design and better accessibility of usage and spend data."
Software companies face significant revenue loss due to outdated financial systems that struggle to measure usage-based services, particularly those incorporating AI. A survey of 350 executives revealed that 44 percent of UK business leaders have difficulties tracking consumption, leading to revenue leakage. This leakage can stem from untracked usage data or outdated pricing. M3ter estimates that 4 to 7 percent of annual recurring revenue is at risk due to poor bookkeeping. The complexity of AI pricing further complicates revenue generation, with only 30 percent of companies reporting increased revenue from AI recently.
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