Google and OpenAI have done similar things with their LLM offerings.
Gemini Advanced offered 2.5 Pro with nearly unlimited rate limits, then nerfed it to 100/day.
OpenAI silently nerfed the maximum context window of reasoning models in their Pro plan.
Accompanying the nerf is usually a psy op, like nerfing to 50/day then increasing it to 100/day so the anchoring effect reduces the grievance.
It's a smart ploy because as much as we like to say there's no moat, the user does face provider switching costs (time and effort), which serves as a mini-moat for status quo provider.
So providers have an incentive to rope people in with a loss leader, and then rug pull once they gained market share. Maybe 40% of the top 5% of Claude users are now too accustomed to their Claude-based workflows, and inertia will keep them as customers, but now they're using the more expensive API instead. Anthropic won.
Modern bait and switch, although done intelligently so no laws are broken.
Gemini Advanced offered 2.5 Pro with nearly unlimited rate limits, then nerfed it to 100/day.
OpenAI silently nerfed the maximum context window of reasoning models in their Pro plan.
Accompanying the nerf is usually a psy op, like nerfing to 50/day then increasing it to 100/day so the anchoring effect reduces the grievance.
It's a smart ploy because as much as we like to say there's no moat, the user does face provider switching costs (time and effort), which serves as a mini-moat for status quo provider.
So providers have an incentive to rope people in with a loss leader, and then rug pull once they gained market share. Maybe 40% of the top 5% of Claude users are now too accustomed to their Claude-based workflows, and inertia will keep them as customers, but now they're using the more expensive API instead. Anthropic won.
Modern bait and switch, although done intelligently so no laws are broken.