Software sector at record underperformance vs semiconductors, analyst says more to go.
Mike
Ben Reitzes
Been through similar disruption before with cloud - market correctly discounted disruption and legacy stocks didn't work for years.
Ben Reitzes
Software companies had it good in 2010s but it's over; marginal cost of coding going to zero.
What does coding commoditization mean for AI companies like Anthropic?
Mike
Ben Reitzes
Good for AI innovators like Anthropic who compete with Microsoft; traditional franchises at risk.
Software companies argue they have specialized data and expertise that AI models lack.
Mike
Ben Reitzes
That's nonsense - whoever owns data wins; coding becomes commodity; AI-first startups will do unimaginable things within 5 years.
Enterprise software customers didn't love them due to pricing.
Mike
Ben Reitzes
Software companies raised prices 40% above inflation post-COVID, had fake seat growth, earnings inflated by stock options.