Such upheaval could drive M&A activity within software and the broader technology industry, and the business of software — the preeminence of the software industry and the organizing principles of software companies — could change. GitHub claims that 46% of new code is already developed by AI.6 As generative software development becomes more pervasive, the ability of individuals, teams and enterprises to build their own custom software improves, and the pricing power of packaged software providers decreases. Profits of the software industry may be redistributed to customers, and beneficial investment by software companies may be reduced. As the customers of today’s software companies replace existing products with generative-AI-powered solutions, software company profits may come under pressure. In some ways, generative software development is arguably favorable to emerging software companies, because it reduces the resources necessary to develop any piece of software.

Source: Forbes August 09, 2024 05:29 UTC