$DOCN @digitalocean
My view: Impact of MSFT decision to cut off Claude Code from internal devs bc cost (per token) is just too high.
*Exactly*
this is *exactly* the DOCN thesis.
The first read is obvious: more agentic coding means more inference demand.
ok, of course. Duh.
But the second read is the one that matters.
Enterprises cannot just spray every task at the most expensive frontier model forever; not even MSFT.
That is not a business model. That is a cost explosion.
The future is not open source versus closed source. It's far more nuanced.
The future is "weighted average intelligence cost." OK I made up a new phrase 😂.
Use the frontier model when it matters. Use the smaller or open model when it is good enough. Route intelligently. Keep accuracy high. Keep latency low. Collapse cost per useful output.
This is DOCN's software layer.
So what is that? It's *a lot.*
It is routing, orchestration, model selection, open source model support, closed source model integration, caching, memory, state management, data movement, database access, storage, networking, security, observability, traceability, workload scheduling, sandboxing, governance, cost controls, latency optimization, throughput optimization, kernel optimization, deployment, scaling, retries, failover, and monitoring.
That is DOCN’s opening. This is why they are suddenly growing 130%+ with $1M+ ARR companies- AI natives.
They are a full blown cloud + AI inference cloud.
This is what CEO means by "dumb tokens" versus "smart tokens."
A token generated by the wrong model at the wrong cost is waste.
A token routed to the right model, with the right accuracy, latency, and context, is margin.
So Microsoft pulling back from expensive Claude Code usage is not anti AI.
It is the beginning of AI cost discipline.
And AI cost discipline is exactly where DOCN wants to live.
Look at the benchmarks. This is about to be an "AI Native" hyperscaler.