Vercel CEO Claims AI Model Companies Lack User Loyalty
Vercel CEO Guillermo Rauch stated in an interview that AI model companies have "zero loyalty" to users, exhibiting characteristics similar to the worst phase of the cryptocurrency boom.
He pointed out phenomena such as artificially inflated token usage, extensive free promotions, and false zero data retention (ZDR) claims within the industry.
Rauch mentioned that if he were in these companies, he would question what proportion of their users came solely due to free subsidy programs. He has previously stated that he rejects free token promotions with questionable ZDR claims and credibility every week.
Vercel processes real customer traffic through its AI Gateway, emphasizing no markup and compliance with ZDR agreements. The company reports that about 80% of AI Gateway token volume comes from open-source models.
The interview also noted that AI agents currently drive about 60% of Vercel's deployments, a significant increase from 3% in January 2026. The company's annual revenue is reported to reach $600 million, a 148% year-on-year growth.
Free subsidies and promotions direct short-term user traffic to model providers, but it is difficult to distinguish real demand from subsidy-driven traffic when retention data is lacking. Funding and token volume are concentrated during promotional periods and may quickly shift to other providers after subsidies end.
Source: Public Information
ABAB AI Insight
Guillermo Rauch co-founded Vercel, which provides front-end deployment and AI Gateway services, with clients including OpenAI, Meta, and Stripe. Its AI Gateway routes models based on actual usage, emphasizing no markup and providers with signed ZDR agreements.
Rauch compares the free promotions, inflated token volumes, and questionable ZDR claims of some model companies to a phase in the cryptocurrency boom characterized by a lack of real retention. He suggests that model companies assess the proportion of their users reliant on free subsidies to distinguish sustainable demand from short-term traffic.
Similar observations can be seen in other infrastructure providers' public comments on model layer promotions and data policies, with some companies also emphasizing that their traffic comes from paying customers rather than subsidies. Current model providers are in a highly competitive phase, vying for developer attention through free quotas and promotions.
This reflects a path driven by capital concentration and subsidies: free programs temporarily direct users to specific models, but without loyalty metrics, traffic can shift as subsidies end. If model companies cannot prove paid retention, they face the same "easy come, easy go" risk as early cryptocurrency projects.
ABAB News · Cognitive Laws
Free subsidies equal short-term traffic rather than retention
False ZDR equals unreliable data policies
Zero loyalty equals users switching with price