# How AI applications earn their premium against cheaper models and in-house alternatives

> Original title: How AI Applications Earn Their Premium

- Source: a16z News
- Published: 2026-11-02T15:03:05.000Z
- Bad Influence: https://badinfluence.news/items/ut6tx354109e9jur96yqut9hi
- Original: https://www.a16z.news/p/how-ai-applications-earn-their-premium

## Summary

a16z argues that AI application companies must justify their pricing as customers gain access to more capable models and easier development tools. It cites Repsol's blind test, in which Harvey beat Microsoft Copilot and Repsol's in-house Lexia prototype on quality, accuracy, and time savings over an eight-week pilot with 50 lawyers. Harvey reports lawyers now save four to six hours per week, with adoption at 96% across Repsol's legal department.