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sourceDocument: Australia Enable AI
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# Cost types and sub-vendor rates

# Cost types and sub-vendor rates {#ariaid-title1}

Release version: Australia  
Updated September 23, 2026  
![](https://www.servicenow.com/docs/portal-asset/ico-clock) 2 minutes to read
Summarize  
![AI sparkle icon](https://servicenow.com/docs/portal-asset/ai-sparkle-icon) Summarized using AI  
This content was generated using new OpenAI-powered functionality. Results are provided on an as is basis and are not guaranteed to be accurate or complete.  

## Summary of Cost types and sub-vendor rates

This content explains how to record and manage the costs your organization pays to various AI vendors within AI Control Tower.
Accurately capturing these costs enables AI Control Tower to calculate your total Enterprise AI cost and net returns by comparing these costs against productivity savings derived from AI usage.
Show full answer Show less  

## Key Concepts

* **Enterprise AI Cost Calculation:** Total Enterprise AI cost includes costs from both integrated vendors and other vendors.
* **Net Returns:** Calculated as total savings (productivity gains valued at your configured hourly rates) minus total Enterprise AI cost.

## Vendors and Cost Types

Vendors are categorized as:

* **Integrated Vendors:** Vendors with trace or SDK integrations, such as Microsoft, Google Vertex AI, and AWS. AI Control Tower automatically collects token consumption metrics from these sources.
* **Other Vendors:** Vendors without trace or SDK integration. Cost entry for these is optional.

Cost types determine how you input vendor costs and how AI Control Tower calculates them:

* **For Integrated Vendors:**
  * **Overall cost:** A single cost per million tokens.
  * **Input and output costs:** Separate costs per million input tokens and output tokens.
  * **Subscription:** Number of licensed seats, cost per seat per month, contract dates, and optional one-time setup fee.
* **For Other Vendors:** Choose among three pricing models:
  * **Token-based:** Cost per token used.
  * **Direct Cost:** Enter total cost directly.
  * **Subscription:** Per-seat subscription pricing.

## Sub-vendor Rates

Sub-vendors represent specific services offered by a vendor (e.g., Microsoft as vendor and Azure as a sub-vendor). Sub-vendor rates override the parent vendor's rates for their respective services. If sub-vendor rates exist, the vendor's rate applies only to usage not covered by any sub-vendor.

## Subscription Cost Estimation

The estimated monthly cost for subscriptions is automatically calculated by AI Control Tower as:

* Number of licensed seats × Cost per seat per month
* Plus, if applicable, a one-time setup fee amortized evenly over a specified number of months.

## Cost Entry Status

* **Draft:** Newly added or changed cost entries are in draft status and do not affect calculations until submitted.
* **Active:** Submitted entries that are currently used in cost and savings calculations.
* **Expired:** Entries that are no longer active.

## Practical Application for ServiceNow Customers

By carefully defining cost types and sub-vendor rates within AI Control Tower, you can:

* Ensure precise tracking of your AI vendor expenses aligned with your contracts and billing models.
* Obtain accurate calculations of total AI costs and net returns to assess financial impact.
* Manage cost entries effectively through statuses, enabling controlled updates before applying changes.
* Leverage flexibility in cost modeling to accommodate a variety of vendor billing structures and services.  
Record what your organization pays each AI vendor so that AI Control Tower can calculate total Enterprise AI cost and net returns. Choose the cost type that matches each contract, and set sub-vendor rates where a specific
service is billed differently from its vendor.

AI Control Tower estimates the financial value of your AI assets by comparing total savings with total Enterprise AI cost. Total savings come from productivity gains and the hourly rates that you configure. Total Enterprise AI
cost is the sum of integrated vendor costs and other vendor costs. Net returns are total savings minus total Enterprise AI cost.

## Integrated vendors and other vendors {#mc-ai-cost-types-and-sub-vendor-rates__section_vendor_categories}

Integrated vendors are vendors that have a trace or SDK integration with AI Control Tower, such as Microsoft, Google Vertex AI, and Amazon Web Services (AWS). AI Control Tower gets token consumption metrics for these vendors from the traces.

Other vendors are vendors that don't have a trace or SDK integration with AI Control Tower. Entering costs for these vendors is optional.

## Cost types {#mc-ai-cost-types-and-sub-vendor-rates__section_cost_types}

The cost type determines which values you enter and how AI Control Tower calculates the cost for a vendor.  
{#mc-ai-cost-types-and-sub-vendor-rates__table_akc_tgh_rkc__entry__2}

| Cost type | Values you enter |
|-|-|
| Overall cost | A single cost per million tokens. |
| Input and output costs | Separate costs per million input tokens and per million output tokens. |
| Subscription | The number of licensed seats, the cost per seat per month, and the contract start and end dates. You can also add a one-time setup fee. |
[Table 1. Cost types for integrated vendors]

{#mc-ai-cost-types-and-sub-vendor-rates__table_akc_tgh_rkc}  
For other vendors, the Add Vendors menu offers three pricing options:

* Token-based: Costs are calculated based on the total number of tokens used and the cost per token.
* Direct Cost: The total cost is entered directly.
* Subscription: Pricing is determined by a per-seat subscription model.
{#mc-ai-cost-types-and-sub-vendor-rates__ul_jkq_zgh_rkc}

These options provide flexibility in how costs are determined.

## Sub-vendor rates {#mc-ai-cost-types-and-sub-vendor-rates__section_sub_vendor_rates}

A sub-vendor is a specific service that a vendor offers. For example, Microsoft is a vendor, and Azure is one of its sub-vendors. In the cost list, it appears as the vendor name followed by the service name.

A sub-vendor rate takes precedence over its vendor's rate. When a vendor has at least one sub-vendor rate, its entry shows the message Applies only where no sub-vendor rate is set. The vendor rate
continues to apply to usage that isn't covered by a sub-vendor rate.

## Estimated monthly cost for subscriptions {#mc-ai-cost-types-and-sub-vendor-rates__section_estimated_monthly_cost}

For a subscription, the Estimated monthly cost value is the number of licensed seats multiplied by the cost per seat per month. The value updates as you enter the details.

If you add a one-time setup fee, AI Control Tower spreads the fee evenly over the number of months that you enter in Amortise over (months). It adds the resulting monthly amount to the estimated monthly
cost. The per-month amount of the fee appears after the field.

## Cost entry status {#mc-ai-cost-types-and-sub-vendor-rates__section_status}

A cost entry that you add or change has the status Draft, and the page shows the message Changes will apply after you submit in Preview cost \& savings. Draft entries don't
affect calculated values until you submit the configuration in the Preview cost \& savings step. Submitted entries have the status Active.

An entry can also have the status Expired.
**Related tasks**   

* [Add costs for integrated vendors](https://www.servicenow.com/docs/T8_GhjNRe924jiZI5RABQw "Add the cost of a vendor or sub-vendor integrated with ServiceNow so that AI Control Tower includes it in the total Enterprise AI cost. Set a sub-vendor rate when a specific service is billed differently from the vendor.")
* [Add costs for other vendors](https://www.servicenow.com/docs/8JfCk_KGkil122NnIYlzoQ "Configuring costs for LLM vendors without direct integrations with AI Control Tower requires manual input. You must manually enter token usage, direct costs, or a per-seat subscription. AI Control Tower can then include these costs in total AI cost calculations.")