Seat pricing is breaking down because AI means fewer humans do more work — your best outcomes can now have fewer logins. But ripping out seats overnight destroys revenue predictability and triggers churn. Migrate in phases.

The phased migration

  1. Run hybrid first. Keep a platform fee (the predictability floor) and add a usage component on top. Nobody loses their plan; you start collecting usage data.
  2. Grandfather existing accounts. Let current customers stay on seats until renewal. Migrate at natural contract boundaries, never mid-term.
  3. Price the new model to be revenue-neutral at median usage. The typical customer should pay about the same; only the heavy-value users pay more.
  4. Publish a calculator. Let customers model their own bill. Surprise is the enemy of a pricing change.

The catch

Usage pricing can punish growth if a customer's bill spikes unpredictably. Add monthly caps or commit-and-burn discounts so finance teams can forecast.

Bottom line: keep a fee floor, migrate at renewals, and make the new bill predictable — then usage pricing expands revenue instead of scaring it off.