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Usage-based pricing is a consumption-based pricing model in which customers are charged only when they use a product or service. Typically, the customer is billed at the end of the billing cycle. In a flat, subscription pricing model, the user is charged a fee regardless of how often they use the service. In contrast, a usage-based charge fluctuates according to what the customer actually consumes. Usage-based pricing may also be referred to as metered services.