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Usage-based billing (also known as metered billing) charges customers based on how much they consume your service.

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Setup Guide

To set up usage-based billing:
  1. Create a Product: Define the service (e.g., “Cloud Storage”).
  2. Create a Plan: Select Usage-based pricing.
    • Meter Name: storage_gb
    • Billing Scheme: per_unit
    • Price: $0.10 per GB.
  3. Subscribe Customer: Assign the plan.
  4. Report Usage: Send usage events via API.

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Usage Reporting Models

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1. Metered (Sum)

Good for events like “API Calls” or “Emails Sent”.
  • You send: +1, +5.
  • We bill: Sum of all events.
  • Reset: Counter resets to 0 at start of next cycle.

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2. Licensed (Max)

Good for “High water mark” billing, like “Max Concurrent Connections”.
  • You send: Current usage periodically.
  • We bill: The highest value seen during the period.

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3. Gauge (Last)

Good for “Number of Active Seats” where you want to bill for the count at the exact moment of invoicing.
  • You send: Current count.
  • We bill: The last value recorded before the cycle closes.

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Handling Overages

You can combine flat fees with usage.
  • Plan: $20/month (includes 1000 API calls).
  • Overage: $0.01 per call after 1000.
This is configured using Tiers:
  • Tier 1: 0-1000 units -> $0 (Flat fee covers this)
  • Tier 2: 1001+ units -> $0.01/unit