Piston Labs Infrastructure Cost Analysis

Last Updated: 2026-01-04 Purpose: Investment planning, unit economics, margin analysis

Executive Summary

Consumer Pricing (B2C)

Item	Price
Device Sale Price	$150
Monthly Subscription	$15/mo
Hardware Cost (to Piston)	$110
Hardware Margin	$40 (27%)

Fleet Pricing (B2B)

Item	Price
Device Sale Price	$135
Monthly Subscription	$25/mo
Hardware Margin	$25 (19%)

Shop Dashboard Pricing (B2B SaaS - Freemium)

Tier	Price	Features
Free	$0/mo	Record uploading, Lite CRM customer list, Service request notifications
Pro	$100/mo	Calendar scheduler, In-app messaging

Free Tier Includes:

Upload and store repair orders/service records
Basic customer list (lite CRM)
Receive service request notifications from consumers

Pro Tier Adds:

Calendar/appointment scheduler
In-app messaging with customers

Unit Economics

Metric	Value
Variable Cost per Device	$2.26/month
Annual Variable Cost per Device	$27.12/year
Consumer Subscription Gross Margin	84.9%
Fleet Subscription Gross Margin	90.9%

Year 1 Revenue per Device

Channel	Device Sale	Subscription (12 mo)	Total Year 1
Consumer	$150	$180	$330
Fleet	$135	$300	$435

Cost Composition: ~97% cellular (Soracom plan01s), ~3% infrastructure (Cloudflare/Supabase/Vercel)

Current Infrastructure Stack

Layer	Provider	Purpose
Cellular Gateway	Soracom Beam	TCP→HTTPS protocol conversion
Telemetry Ingestion	Cloudflare Workers	HTTPS receiver, real-time processing
Time-Series Analytics	Cloudflare Analytics Engine	Trip data, odometer, fuel
State Management	Cloudflare Durable Objects	Device/vehicle state, trips
Archival Storage	Cloudflare R2	Raw telemetry NDJSON
Database	Supabase (Postgres)	Users, vehicles, service records
Authentication	Supabase Auth	Consumer & shop login
Web Hosting	Vercel	Next.js consumer & shop apps
Push Notifications	OneSignal	Service reminders

Cost Breakdown by Service

Cloudflare (Telemetry Backend)

Plan: Workers Paid ($5/month base)

Component	Pricing	1K Devices	10K Devices
Workers Invocations	$0.30/million	~$1.32	~$13.20
Analytics Engine	$0.25/million data points	~$1.10	~$11.00
Durable Objects Requests	$0.15/million	~$2.16	~$21.60
Durable Objects Duration	$12.50/million GB-s	~$3.24	~$32.40
R2 Storage	$0.015/GB/month	~$0.05	~$0.50
R2 Operations	$0.36/million Class A	~$0.12	~$1.20
Base Fee		$5.00	$5.00
Subtotal		~$13	~$85

Assumptions (v5 config):

1 hour driving/day (average consumer)
v5 config: 10-second transmission when moving, 1-hour when parked
383 transmissions/device/day average
11.5M transmissions/month (1K devices)

Supabase (Database & Auth)

Plan: Pro ($25/month)

Component	Included	Overage	1K Devices	10K Devices
Database	8GB	$0.125/GB	~500MB	~5GB
Auth MAUs	100K	$0.00325/MAU	~1,050	~10,500
Storage	100GB	$0.021/GB	~5GB	~50GB
Bandwidth	250GB	$0.09/GB	~20GB	~200GB
Edge Functions	2M	$2/million	~15K	~150K
Base Fee			$25.00	$25.00
Subtotal			~$25	~$50-75

Usage Patterns:

~315K DB reads/month (1K devices)
~21K DB writes/month
Realtime: 1 channel (vehicle status updates)

Vercel (Web Hosting)

Plan: Pro ($20/month)

Component	Included	1K Devices	10K Devices
Bandwidth	1TB	~50GB	~500GB
Serverless Invocations	1M	~200K	~2M
Edge Middleware	1M	~300K	~3M
Base Fee		$20.00	$20.00
Subtotal		~$20	~$50-100

Soracom (Cellular Gateway)

Plan: plan01s (Global) with Beam

Soracom provides cellular connectivity for Teltonika devices via SIM and protocol conversion (TCP→HTTPS) via Beam. See SORACOM-COST-ANALYSIS.md for detailed packet size analysis and usage scenarios.

Why Soracom Beam is Required: The FMM00A device only supports TCP/UDP (no native HTTP/HTTPS). Cloudflare Workers only accept HTTP/HTTPS. Soracom Beam provides the TCP→HTTPS bridge with a generous free tier.

Component	Pricing	1K Devices	10K Devices
Base Fee (per SIM)	0.06/day( 1.80/mo)	$1,800	$18,000
Data (pay-as-you-go)	$0.08/MB	~$387	~$3,870
Beam Requests	$0.09/10K (first 100K free)	~$10	~$100
Subtotal		~$2,197	~$21,970

Per-Device Cost by Usage Pattern:

Usage Pattern	SIM Base	Data	Beam	Total/Device
Average consumer (1 hr/day)	$1.80	$0.39	$0.01	$2.20
Heavy driver (3 hrs/day)	$1.80	$1.14	$0.03	$2.97
Commercial fleet (8 hrs/day)	$1.80	$3.05	$0.08	$4.93

v5 Config Data Usage (Codec 8 Extended):

State	Transmission Rate	Packet Size	Records
Moving (ignition ON)	Every 10 seconds	~440 bytes	5 batched
Parked (ignition OFF)	Every 1 hour	~120 bytes	1

Average Consumer (1 hr driving/day):

Moving: 360 transmissions × 440 bytes = 158 KB/day
Parked: 23 transmissions × 120 bytes = 2.8 KB/day
Monthly total: 4.83 MB/device
Monthly requests: 11,490/device

Beam Pricing Detail:

Tier	Cost
First 100,000 requests/month	FREE
100,001+ requests	$0.09 per 10,000 requests

Volume discounts available from Soracom at 1,000+ devices. Contact for enterprise pricing.

OneSignal (Push Notifications)

Plan: Free tier (up to 10K subscribers)

Tier	Subscribers	Cost
Free	0-10K	$0
Growth	10K-100K	$9/month
Professional	100K+	Custom

Repair Order Parsing (AI Pipeline)

Pipeline: Google Document AI OCR → ChatGPT → Structured JSON Purpose: Extract line items from repair order PDFs/photos (parts, labor hours, costs, mileage) Recommendation (Ryan): gpt-4o-mini offers best resolution for the price

Model Name	Google Doc AI OCR ($/1K pages)	Input ($/1M tkn)	Output ($/1M tkn)	Cost/100K Docs ($)	Cost/1M Docs ($)	Cost/Doc ($)	Avg Input Tkns	Avg Output Tkns
gpt-4o-mini (Standard)	1.5	0.15	0.6	322.5	3,225	0.003	3,500	2,000
gpt-4o-mini (Batch)	1.5	0.075	0.3	236.25	2,362.5	0.002	3,500	2,000
gpt-4.1-mini (Standard)	1.5	0.4	1.6	610	6,100	0.005	3,500	2,000
gpt-4.1-nano (Standard)	1.5	0.1	0.4	265	2,650	0.002	3,500	2,000
gpt-5-mini (Standard)	1.5	0.25	2	1,390	13,900	0.005	1,600	6,000
gpt-5-nano (Standard)	1.5	0.05	0.4	398	3,980	0.002	1,600	6,000
gpt-5-mini (Flex)	1.5	0.125	1	770	7,700	0.003	1,600	6,000
gpt-5-nano (Flex)	1.5	0.025	0.2	274	2,740	0.002	1,600	6,000
gpt-4.1-mini (Batch)	1.5	0.2	0.8	380	3,800	0.003	3,500	2,000
gpt-4.1-nano (Batch)	1.5	0.05	0.2	207.5	2,075	0.002	3,500	2,000

Key Takeaways:

Best quality/price: gpt-4o-mini (Standard) @ $0.003/doc — Ryan's pick for resolution
Cheapest at scale: gpt-4.1-nano (Batch) @ $0.002/doc — 38% cheaper but may sacrifice extraction accuracy
At 100K docs/year: ~$322 with recommended model
At 1M docs/year: ~$3,225 with recommended model

Scaling Estimates (1K devices):

Avg repair orders/vehicle/year: ~4-6
1K devices × 5 orders = 5,000 docs/year
Cost: ~$15/year for AI parsing

Total Infrastructure Costs

At 1,000 Devices

Service	Monthly Cost
Soracom (cellular)	$2,197
Cloudflare	$13
Supabase	$25
Vercel	$20
OneSignal	$0
Total	$2,255

Unit Economics:

Cost per device: $2.26/month
Annual cost per device: $27.12/year

At 10,000 Devices

Service	Monthly Cost
Soracom (cellular)	$21,970
Cloudflare	$85
Supabase	$50-75
Vercel	$50-100
OneSignal	$9
Total	$22,165-22,240

Unit Economics:

Cost per device: $2.22/month
Annual cost per device: $26.60/year

At 100,000 Devices

Service	Monthly Cost (est.)
Soracom (cellular)	$220,000
Cloudflare	$800-1,000
Supabase	$300-500
Vercel	$300-500
OneSignal	$100-200
Total	$221,500-222,200

Unit Economics:

Cost per device: $2.22/month
Annual cost per device: $26.58/year

Cost Breakdown: Infrastructure vs Cellular

Scale	Infrastructure Only	Soracom Cellular	Total	% Cellular
1K devices	58/mo(0.058/device)	2, 197/mo(2.20/device)	$2,255/mo	97%
10K devices	194/mo(0.019/device)	21, 970/mo(2.20/device)	$22,164/mo	99%
100K devices	1, 500/mo(0.015/device)	220, 000/mo(2.20/device)	$221,500/mo	99%

Key Insight: Soracom cellular costs dominate. Infrastructure scales beautifully (sub-linear), but per-SIM cellular costs are fixed. The $0.06/day base fee on plan01s is the primary driver (~82% of per-device cost).

Margin Analysis

Consumer Subscription Model ($15/mo)

Component	Cost/Device/Month	At $15/mo Subscription
Soracom (cellular)	$2.20
Infrastructure (at 10K scale)	$0.02
Total Variable Cost	$2.22
Gross Profit		$12.78
Gross Margin		85.2%

Margin Sensitivity Analysis

Subscription Price	Variable Cost	Gross Profit	Gross Margin
$10/mo	$2.22	$7.78	77.8%
$12/mo	$2.22	$9.78	81.5%
$15/mo	$2.22	$12.78	85.2%
$20/mo	$2.22	$17.78	88.9%

B2B Fleet Model (per vehicle)

Standard Fleet Pricing: $25/mo per vehicle

Tier	Price/Vehicle	Variable Cost	Gross Margin
Standard Fleet (5-50)	$25/mo	$2.22	91.1%
Medium Fleet (50-200)	$22/mo	$2.22	89.9%
Enterprise (200+)	$18/mo	$2.22	87.7%

Hardware Costs (Teltonika FMM00A)

Component	Unit Cost	Notes
FMM00A Device	$85	Current supplier pricing
Soracom SIM	$5	One-time SIM cost
Packaging & Shipping	$20	Per unit landed
Total Hardware (Landed)	$110	One-time

Total Cost of Ownership (Year 1)

Component	Consumer Channel	Fleet Channel
Hardware (landed)	$110	$110
Soracom cellular (12 mo @ $2.20)	$26.40	$26.40
Infrastructure (12 mo @ $0.02)	$0.24	$0.24
Total Cost	$136.64/device	$136.64/device

Device Sale Revenue	$150	$135
Subscription Revenue (12 mo)	*180 *(15/mo)	*300 *(25/mo)
Total Year 1 Revenue	$330	$435
Year 1 Gross Profit	$193.36/device	$298.36/device

Device Sales Revenue

Customers purchase devices upfront before activation. Device sales are a significant revenue stream:

Channel	Device Price	Hardware Cost	Hardware Margin	Units (Seed)	Total Hardware Revenue
Consumer	$150	$110	$40 (27%)	225	$33,750
Fleet	$135	$110	$25 (19%)	75	$10,125
Total				300	$43,875

At seed scale (300 devices):

Hardware revenue: $43,875
Hardware margin: $10,875 (25% blended)
This is in addition to subscription revenue ($63,000 ARR)

Buy Now Pay Later (BNPL) Opportunity

Goal: Partner with a BNPL provider to reduce friction for consumer purchases.

Why BNPL:

$150 upfront is a barrier for budget-conscious consumers
BNPL converts to "~$12-15/mo for 12 months" messaging
Increases conversion rate and addressable market
We get paid upfront by BNPL provider

Potential Partners:

Provider	Merchant Fee	Consumer Terms	Notes
Affirm	5-6%	0% APR 3-12 mo	Strong brand, auto-focused
Klarna	3-6%	0% APR 4 payments	Popular with younger demos
Afterpay	4-6%	4 payments, 2 weeks	Smaller purchases
PayPal Pay Later	2-4%	4 payments	Lowest fees, wide reach

Economics with BNPL (Consumer):

Scenario	Device Price	BNPL Fee (5%)	Net to Piston	Margin
Without BNPL	$150	$0	$150	$40 (27%)
With BNPL	$150	$7.50	$142.50	$32.50 (23%)

Trade-off: 4% margin reduction for higher conversion. Worth testing.

Consumer Messaging:

Without BNPL: "$150 device + $15/mo subscription"
With BNPL: "From $12/mo for device + $15/mo subscription = $27/mo total"

Next Steps:

Evaluate Affirm (auto-focused, premium positioning)
Evaluate PayPal Pay Later (lowest fees, widest reach)
A/B test conversion rates with/without BNPL option

Seed Stage Unit Economics

For investor discussions. See SEED_METRICS_CONTEXT.md for full context.

Revenue Model

Channel	Device Price	Hardware Cost	Hardware Margin	Subscription	Year 1 Revenue/Device
Consumer	$150	$110	$40 (27%)	$15/mo	$330
Fleet	$135	$110	$25 (19%)	$25/mo	$435

Seed Targets (300 Devices)

Metric	Target	MRR	ARR
Consumer devices	225	$3,375	$40,500
Fleet devices	75	$1,875	$22,500
Total	300	$5,250	$63,000

Unit Economics at Seed Scale (300 devices)

Metric	Consumer (225)	Fleet (75)	Blended
Hardware revenue	$33,750	$10,125	$43,875
Hardware cost	24, 750(110x225)	8, 250(110x75)	$33,000
Hardware margin	$9,000 (27%)	$1,875 (19%)	$10,875 (25%)
Monthly subscription	$3,375	$1,875	$5,250
Monthly variable cost	500(2.22x225)	167(2.22x75)	$666
Monthly gross profit	$2,875	$1,708	$4,584
Monthly gross margin	87%	92%	89%

Year 1 Projections (300 devices)

Component	Amount
Hardware revenue	$43,875
Hardware cost	$33,000
Hardware margin	$10,875 (25%)
Subscription revenue (12 mo)	$63,000
Variable costs (12 mo)	$7,992
Gross profit	$65,883
Blended gross margin	62%

Note: Gross margin on subscriptions alone is 87%. Hardware margin (25%) brings blended margin down. After Year 1, margins improve as hardware is paid off.

Key Investor Metrics

Metric	Value	Benchmark
Year 1 Gross Profit (consumer)	$193/device	Hardware + subscription - costs
Year 1 Gross Profit (fleet)	$298/device	Higher subscription margin
LTV (3 years @ 85% retention)	$503	Includes $40 device margin + subscription
LTV:CAC ratio	~8:1	> 3:1 (good)
Year 1 revenue/device	$330-430
Variable cost/device	$2.22/mo

Cost Optimization Opportunities

Current Optimizations

R2 batching (60s/100 records) - saves ~40% on write costs
Analytics Engine per-record (no batch benefit)
Durable Object state colocation (no external DB calls)
Privacy-first GPS stripping (reduces storage)

Future Optimizations

Reduce moving sample rate - 5s instead of 2s could reduce data costs ~50%
Adaptive telemetry intervals (idle = 60s, driving = 10s)
Edge caching for dashboard API calls
Supabase read replicas for shop dashboard
Cloudflare Stream for dashcam (if added)
Negotiate volume discounts with Soracom at 10K+ scale

Appendix: Pricing Sources

Soracom Plan-US: https://developers.soracom.io/en/docs/reference/fees/
Soracom Beam: https://developers.soracom.io/en/docs/beam/
Cloudflare Workers: https://developers.cloudflare.com/workers/platform/pricing/
Cloudflare R2: https://developers.cloudflare.com/r2/pricing/
Cloudflare Analytics Engine: https://developers.cloudflare.com/analytics/analytics-engine/pricing/
Supabase: https://supabase.com/pricing
Vercel: https://vercel.com/pricing
OneSignal: https://onesignal.com/pricing

Revision History

Date	Changes
2026-01-03	Updated Soracom costs with v5 config analysis (packet sizes, usage patterns)
2026-01-02	Fixed TCO to include device revenue, clarified break-even, fixed LTV calc, MQTT→HTTPS
2026-01-03	Updated hardware to 110landed(85 + $5 SIM + $20 ship), fleet pricing to $25/mo
2026-01-01	Added Soracom cellular costs, $15/mo subscription model, margin analysis
2026-01-01	Initial cost analysis for 1K/10K/100K devices