AI billing gaps risk hitting partner revenues

Christine Horton reports on how the shift to AI and consumption-based pricing is exposing weaknesses in legacy billing systems – hitting partner profitability

Channel partners could already be losing revenue on AI deals due to billing and usage tracking gaps, according to new research from m3ter and PwC UK, with experts warning the issue will intensify as consumption-based models scale.

The study of UK software executives found that 63 per cent lack full confidence in their billing operations, while revenue leakage is estimated at four to seven per cent of annual recurring revenue (ARR) as firms struggle to monetise increasingly complex AI-driven services.

For partners, the issue is not confined to vendors’ back-office systems.

“If the partner is reliant on the vendor to track usage and calculate amounts owed, then they are exposed to the risk too,” said Griffin Parry, CEO and co-founder of m3ter.

“The vendor isn’t doing it on purpose – it’s just that their revenue integrity challenges flow through to their partners.”

Partners ‘missing revenue they’ve already sold’

The shift to AI and consumption-based pricing is exposing weaknesses in legacy billing systems designed for fixed subscription models.

According to the report, 44 per cent of organisations report challenges capturing and measuring usage, while 87 per cent cite a lack of integration between billing platforms and ERP or general ledger systems. Nearly half report no integration between billing and CRM systems.

This fragmentation is creating a direct financial impact across the channel, particularly in complex, multi-layered partner deals.

“Ultimately it means the partner is billing ‘X’ for services when it was entitled to bill ‘X+1’,” said Parry, who added that the issue is already affecting partner revenues today.

“Given the lack of confidence in usage tracking and billing accuracy, it’s fair to say that [partners] may already be missing out on revenue they’ve effectively ‘sold but not been paid for’.”

Parry pointed to causes of the leakage as incomplete capture of usage data, outdated pricing terms feeding billing systems, and calculation errors caused by spreadsheet-based processes.

“In some cases that usage might not be tracked at all… either way, there is no governance around overages and so they don’t get charged for,” he said.

Channel billing problems - more common than partners admit’

Partners say the problem is already surfacing in live deals, particularly as AI services move rapidly towards consumption models.

Mark Skelton, CTO at Node4, said discrepancies between usage, vendor billing and customer invoicing are becoming increasingly visible.

“It’s more common than most partners would care to admit publicly,” he said. “As AI services shift to consumption-based models, the gap between what’s consumed, what’s billed by the vendor, and what we pass on to customers creates real reconciliation challenges.”

Delays in usage reporting are compounding the issue, making it harder for partners to invoice accurately or manage customer expectations.

“We’ve seen situations where usage reporting lags by days or weeks, making accurate real-time invoicing very difficult,” said Skelton.

“The impact isn’t just financial, it can erode customer trust if they’re seeing unexpected charges, or if we’re quietly absorbing costs we should be recovering,” said Skelton.

“Without dedicated tooling and processes, it’s very easy to leave money on the table… before that rigour was in place, we were working largely on trust. At the scale AI is now hitting, that’s not a sustainable position.”

IT channel pricing volatility adds further pressure

The research also highlights how frequently vendors are changing their approach to AI monetisation, adding another layer of complexity for partners to manage.

Just over a third of respondents said they have introduced pay-per-use pricing alongside traditional models, while half have changed pricing at least twice in the past year.

AI is most commonly being monetised through premium product tiers or embedded features with accompanying price increases, but the lack of consistency is making it harder for partners to forecast revenue or design predictable customer contracts.

This volatility is also increasing operational overhead, as partners spend more time reconciling usage, validating invoices and explaining charges to customers.

Billing gap part of wider ‘AI debt’

Analysts argue the issue reflects a deeper structural problem in how organisations have adopted AI.

Steven Dickens, CEO and principal analyst at HyperFRAME Research, said billing challenges are a symptom of a broader “infrastructure adoption gap”.

“The billing issue is a symptom of ‘AI Debt’ – where companies rushed into gen AI pilots without building the underlying fabrics… to support production-grade operations,” he said.

From this perspective, billing failures are not just a finance issue but part of a wider lack of readiness across data, infrastructure and operational systems.

Dickens warned that the challenge will intensify as AI usage becomes more complex.

“As AI moves from single processing calls to autonomous agents completing multi-step tasks, the volume of ‘micro-tasks’ will explode,” he said.

“That creates a fundamentally different metering and monetisation challenge.”

IT channel model under pressure

The move to usage-based pricing is also forcing a rethink of traditional partner business models.

“In traditional models the price of software was fixed… partners would buy for ‘x’, sell for ‘x+1’, and tend to focus on being good sales intermediaries,” said Parry.

“With usage, revenues depend more on adoption and expansion… the partner needs to have more of an ongoing relationship with the customer.”

That shift is pushing partners towards managed services, ongoing optimisation and deeper customer engagement, rather than one-off transactions.

It is also creating new areas of overlap between vendors and partners, particularly as vendors gain direct visibility into usage data and customer behaviour.

“There’s more scope for overlap and competition between partner and vendor,” added Parry.

FinOps emerging as key opportunity

Despite the risks, partners see an opportunity to build new services around billing, optimisation and consumption management.

Skelton said Node4 has already invested in FinOps capabilities to address the challenge.

“We’ve consciously chosen to lean into the opportunity,” he said. “The partners who figure out consumption intelligence, billing accuracy, and FinOps advisory first will build a real competitive advantage.”