Tokens can be stored, Coders gotta code.

A challenge that organisations face is “Tokens can be stored, but coders gotta code.”. Tokens are liquid, you can buy them when you need them. That means you can store your token budget until you need to consume the tokens. Coders are not liquid, you pay for them when they are in attendance, regardless of whether they have work to do. To put it another way, a coder sitting around doing nothing costs the same as the same developer creating or maintaining valuable code.

Furthermore, when coders are in attendance, they will be using tokens. Developers with Agents might be 4x developers. The same developers without Agents will probably be 1/4x developers as they will no longer be able to work in the way they used to. Its the same as taking away a modern laptop from a developers and asking them to go back to punch cards.

Many product managers see their role as “feeding the beast”, feeding their development team with a constant stream of stories to keep them busy. This means product managers will often create stories that keep developers busy rather than stories that deliver business value by satisfying the needs of a customer segment. Product Managers who “fail to feed the beast” will be punished, whereas those that “fail to deliver business value” can easily explain why their experiments did not work.

This option to choose when to invest in tokens, rather than a commitment to consume a developers time continuously has impact on the value of tokens versus developers. The ability to choose “when” an investment is made will drive organisations’ development strategy. Companies will favour higher token cost and lower developer cost rather than higher developer cost and lower token cost. In effect minimise the committed costs (developers) and maximise the optional costs (tokens).

To illustrate this, consider a traditional developer team of six, consisting of two senior devs, two developers and two junior devs costing $100k, $70K and $50K each respectively, at a total cost of $440K

Now consider the “Feed the beast” ratio of the team of 0%, 50% and 75% busy work, and finally AI capacity uplift of 10%, 100% and 400%. How much would an organisation be prepared to spend on token versus developers? What is the break even point for a team of a one Senior Dev, one Dev, and one Junior Dev?

In teams with high “feed the beast” ratio, and a high capacity uplift, the tokens are worth four times the cost of the three developers…. simply because they can be stored and only applied when needed.

This is a very basic way of looking at the value of the tokens. A more sophisticated approach would be to use real options and real liquidity… The detail would get in the way of the message.

The ability to store tokens is very valuable, compared to the committed costs of developers. Perhaps we will start to see zero hour contracts for developers?

Now lets be clear, the value and the cost very rarely have anything to do with each other, especially in competitive markets.

What are the practitioners out there seeing? Are executives starting to consider a new economics of development?