Model Eats the Software: Why the Marginal Cost of Enterprise Software Approaches Zero
More on agentic AI changing the software business from Jason Hoffman:
Andreessen specifically predicted that Salesforce would disrupt Oracle. Fourteen years later, Oracle is roughly 2.5x the size of Salesforce. Salesforce sells application logic – workflows, configurations, business rules. Oracle sells infrastructure – databases, middleware, cloud compute. The application layer was always the vulnerable part. The infrastructure layer was always the durable part. Software ate the world. Then it sat around all gluttonous and bloated. Frozen reasoning."
Also, it was the incumbents who did all the eating.
And, a proposal for using AI as the UI and business logic layer for enterprise apps:
First, right now: meet people in the tools they already use.
Second, the real product: figure out where the data is and what it is. Put MCP servers in front of it. MCP Apps for the interface. The model does the rest.
There’s no step 3 where you build a Salesforce competitor. There’s no application to build. The application is the model connected to the data with a UI layer.
And:
What used to cost $10 million and 18 months – a Salesforce implementation, a custom ERP module, a contract management system – now costs the time it takes to describe what you want.
Related point: the moat for existing ERP companies is keeping all of that data and business logic behind walled gardens.