AI will end hourly billing: Microsoft South Asia President says inefficiency economy is on its way out

India AI Impact Summit 2026 | As artificial intelligence systems grow more capable, the way businesses charge for services may be among the first things to change.

Puneet Chandok, President of Microsoft India and South Asia, said on Monday AI could disrupt what he described as an “inefficiency economy,” where revenues often depend on time spent rather than outcomes delivered.

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“Your lawyer makes more money when the case goes on for longer. Your doctor makes more money when you’re sick for longer. Your IT services partner makes more money if the project runs longer – it’s an inefficiency economy,” Chandok said during a session at India AI Impact Summit 2026. “The longer it takes, the more you make. That charade will end with AI. Because AI doesn’t bill hours, it gives you outputs.”

“If AI can draft a legal document in 30 seconds, your lawyer will not be able to charge you by the hour,” he added, arguing that providers will increasingly be judged by outcomes, not time billed. 

“So, this whole inefficiency economy will actually shift towards real outcomes and all your providers bringing outcomes to you, not hours, which will be interesting for India to see,” he added. 

Microsoft’s top India executive also noted that AI has made remarkable progress in the last three years. There have been disruptions in the past, but “AI is unlike anything I’ve seen before, at least in my lifetime.” 

“We have potentially the prospect of being able to create an intelligence. We have potentially for the first time in humankind the ability to manufacture intelligence, and intelligence is the most valuable commodity on the planet. It’s made this species successful. It’s created everything of value. But potentially the ability to create an intelligence is something that we’ve never seen before,” he said. 

According to him, advancements in AI will soon change the way businesses are done in the country. “The models that you’re seeing today, the capabilities that you’re seeing today are unlike anything we’ve seen in the last few months,” he said. “So it’s incredible to see how that’s going in, and we’re entering a new reality, folks.” 

Chandok said that the companies are used to putting intelligence to work through people. “If you have any problem in your business, you hire people. But with AI, now you have the ability to buy intelligence. And imagine a world where intelligence moves from something which is scarce and expensive and hard to get to something which is abundant, something which is easy to work with. And that is a world we’re getting all prepared for. And if intelligence is available on tap, if unmetered intelligence is available to all of us, it will change everything about how we run businesses and how we run our country.”