Hybrid: Subscription with Overages

this guide explains how to implement a hybrid pricing model a monthly subscription fee included usage for specific features overage charges when usage exceeds those limits this is one of the most common pricing models used in saas and usage based products the scenario you are building a voice and media processing platform your pricing model $199/month includes 1,000 audio processing minutes 500 transcription minutes overages $0 05 per additional audio minute $0 08 per additional transcription minute core concept subscription fee \+ included usage (per meter) \+ overage charges (same meters) → final invoice the key idea included usage and overage charges are defined on the same meter there is no separate system for overages once included units are consumed, the same meter continues billing at the defined rate step 1 define what you want to measure start by identifying the usage you want to track in this example audio minutes transcription minutes each of these becomes a meter where to configure go to meters create one meter per usage type what matters each meter represents something you want to include in the subscription charge overages for you can optionally add dimensions for analytics or cost tracking, but they are not required for this billing model step 2 create a pricing plan where to configure go to pricing create a new pricing plan what you define plan name (e g , voice platform pro plan) billing period (typically monthly) step 3 add the subscription fee this is the base recurring charge where to configure add a subscription rate (previously called flat rate) what you define a label (e g , pro plan subscription) a monthly price (e g , $199) billing timing beginning of billing period this ensures the subscription fee is charged at the start of each cycle step 4 define included usage and overage pricing for each meter, you will configure a per unit rate a number of included units where to configure add a usage based rate for each meter example configuration audio minutes meter audio minutes rate model per unit rate $0 05 per minute included units 1,000 transcription minutes meter transcription minutes rate model per unit rate $0 08 per minute included units 500 how this works for each meter usage is tracked over the billing period included units are applied first any usage beyond that is billed at the defined rate there is no additional configuration required for overages step 5 assign the plan to a customer where to configure go to customers select a customer assign the pricing plan once assigned, all usage tied to that customer will be evaluated against this plan step 6 sending usage (conceptual) usage is sent to the meter over time if you want to test this manually open a meter use event upload enter customer usage value (e g , minutes) ingest the event in production, this would typically be done via api example outcome assume a customer uses 1,200 audio minutes 600 transcription minutes billing calculation subscription $199 base fee audio minutes 1,000 included 200 overage × $0 05 = $10 transcription minutes 500 included 100 overage × $0 08 = $8 total $199 + $10 + $8 = $217 important notes included usage is always tied to the same meter as overages you can define multiple meters within a single plan this model works with simple or complex usage types you can extend this with tiered pricing dimensional pricing discounts why this model is used this pricing model balances predictability → subscription fee flexibility → usage based overages scalability → revenue grows with usage it is widely used because it aligns pricing with both baseline value and actual consumption related concepts for dimensional pricing (e g , model based pricing), see the llm usage guide for internal cost tracking and attribution, see workloads docid\ xtorhvsoi2aok1bzpwfdu this pattern is foundational once understood, it can be adapted to almost any usage based product