AI upstarts are taking software budgets while incumbents discount the products meant to stop them

OpenAI, Anthropic, Cursor and Sierra accounted for 8% of spending by customers of procurement platform Zip during the 12 months through August. That is already a material slice of software budgets for a small set of relatively young AI suppliers, and it helps explain why established vendors are becoming aggressive on price.

Amazon, Microsoft, Figma and Workday are offering discounts on AI products to customers and consulting partners, The Information reports. Buyers are no longer purchasing every assistant on offer: shifting packaging, per-seat charges and usage fees have produced fatigue, while overlapping tools make it easier to select one vendor and reject the rest.

Microsoft’s response is especially revealing. It plans additional Copilot discounts while launching what it describes as an AI “super app.” The immediate objective is subscriber growth; the longer-term objective is to turn those subscribers into usage-based revenue as they invoke more agentic features. A cheap seat can therefore be customer acquisition for metered compute.

The mechanism resembles a platform transition rather than an ordinary feature cycle. Incumbent application vendors have distribution, data and bundled contracts; model and agent companies have the products users increasingly request by name. Discounting lets incumbents buy time, but it also weakens the claim that AI will automatically expand software margins. The durable winner will be the supplier that controls the workflow and can charge for consequential usage, not necessarily the one whose AI is nominally attached to the most existing seats.