Claude Code: Insanely Good, Insanely Pricey

Anthropic is making waves in AI-assisted development with its new agentic coding tool, Claude Code, which works directly within the terminal. While developers are all praises for its “game-changing” abilities, many complain that its pricing is “insanely high”.

By Mohit Pandey

Claude Code was first released internally at Anthropic to accelerate its own development cycle before being made public. “It has been writing half of my code for the past few months,” said Emmanuel Ameisen, a research engineer at Anthropic.

Developers Say It’s a Game-Changer

Claude Code has impressed developers with its ability to fix bugs, resolve merge conflicts, optimise high-performance runtimes, generate CUDA code versions, and even create entire UI design systems in a single shot.

Victor Taelin, founder of Higher Order Company, tested it on HVM3, his company’s parallel computing runtime, and reported a 51% speed boost on an Apple M4 processor. “I just asked Claude Code to optimise the repo, and it did,” he said.

A Reddit user compared it to Cursor, “This thing blows Cursor out of the water,” they wrote, adding that it produces “very high-quality” code without breaking functionality.

‘Claude Code Costs as Much as a Developer’

But here’s a bummer: While Claude Code is fast and effective, it’s also very expensive. One of the biggest criticisms against the coding tool is its high API pricing. Claude 3.7 Sonnet costs $3 per million input tokens and $15 per million output tokens. Developers say it would easily cost them $50-$100 a day, which is comparable to hiring an engineer.

The problem is, other autonomous coding agents aren’t cheap either. Devin, the first AI software engineer, costs $500 a month, but comes with unlimited seats per organisation.

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Meanwhile, Cursor has hit it out of the park by becoming the ‘fastest growing SaaS’ ever.

The platform has achieved a historic milestone, surpassing $100 million in annual recurring revenue (ARR) within just 21 months of its launch. This makes it the fastest-growing SaaS company, outpacing even major enterprise software firms.

Despite concerns that AI could disrupt traditional SaaS businesses, Cursor has, in fact, thrived in the AI-first landscape. According to research from Sacra, the company hit $1 million ARR within its first nine months and skyrocketed to $100 million within the next 12 months.?

Cursor currently serves approximately 360,000 developers, with users paying between $20 to $40 per month for its AI coding capabilities.

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