5 ms·

Anthropic AI tool sparks selloff from software to broader market

87 points by garbawarb 9mo ago

XiS 9mo ago
https://archive.li/VyN2H https://archive.li/VyN2H
epicureanideal 9mo ago
Could this lead to more software products, more competition, and more software engineers employed at more companies?
- rishabhaiover 9mo ago
  maybe eventually, not in the near-term future.
- unyttigfjelltol 9mo ago
  It’s demonetizing process rent-seeking. AI can build whatever process you want, or some approximation of it.
- garbawarb 9mo ago
  I kind of imagine more people going off and building their own companies.
  - DougN7 9mo ago
    I think so too. But because of code quality issues and LLMs not handling the hard edge cases my guess is most of those startups will be unable to scale in any way. Will be interesting to watch.
  - danans 9mo ago
    Not if they don't have access to capital. Lacking that, they won't be building much of anything. And if there a lot of people seeking capital, it gets much harder to secure. Capital also won't be rewarded to people who don't have privileged/proprietary access to a market or non-public data or methods. Just being a good engineer with Claude Code isn't enough.
- fishpham 9mo ago
  I think the argument is that tools like Claude Code will cause more companies to just build solutions in-house rather than purchase from a vendor.
  - groceryheist 9mo ago
    This is correct. AI is a huge boon for open source, bespoke code, and end-user programming. It's death for business models that depend on proprietary code and products bloated with features only 5% of users use.
    - hugs 9mo ago
      possibly also a boon for automated testing tools and infra designed for ai-driven coding.
- guluarte 9mo ago
  I think companies will need to step up their game and build more competitive products with more features, less buggy and faster than what people can build
- danans 9mo ago
  > Could this lead to more software products, more competition, and more software engineers employed at more companies? No, it will just lead to the end of the Basic CRUD+forms software engineer, as nobody will pay anyone just for doing that. The world is relatively satisfied with "software products". Software - mostly LLM authored - will be just an enabler for other solutions in the real world.
  - falloutx 9mo ago
    There are no pure CRUD engineers unless you are looking at freelance websites or fiver. Every tiny project becomes a behemoth of spaghetti code in the real world due to changing requirements. > The world is relatively satisfied with "software products". you can delete all websites except Tiktok, Youtube and PH, and 90% of the internet users wouldnt even notice something is wrong on the internet. We dont even need LLMs, if we can learn to live without terrible products.
gip 9mo ago
I'm not really understanding why Thomson Reuters is at direct risk from AI. Providing good data streams will still be very valuable?
- robotswantdata 9mo ago
  Huge legal tech business units
- yodon 9mo ago
  If customers start asking Claude first, before they ask Thomson Reuters, that's a big risk for the later company.
  - gip 9mo ago
    Got it, thank you for the insight. The assumption is that Claude has access to a stream of fresh, currated data. Building that would be a different focus for Anthropic. Plus Thomson Reuters could build an integration. Not totally convinced that is a major threat yet.
    - disgruntledphd2 9mo ago
      It's definitely not a major threat, but many/most finance people are clueless about what is and isn't possible with LLMs. Again, unless Anthropic are taking on liability for their legal tools, this is not going to impact TR. That being said, there probably is a potential company here that's gonna be built soon/is currently being built, but it definitely won't just be a wrapper around Claude as the recall will be way too low for these systems unaided.
- whitej125 9mo ago
  TR will not disappear. But their value to the market was "data + interface to said data" and that value prop is quickly eroding to "just the data". You can be a huge, profitable data-only company... but it's likely going to be smaller than a data+interface company. And so, shareholder value will follow accordingly.
deleted 9mo ago
[deleted]
simianwords 9mo ago
I came across this company called OpenEvidence. They seem to be offering semantic search on medical research. Founded in 2021. How could it possibly keep up with LLM based search?
- dnw 9mo ago
  It is a little more than semantic search. Their value prop is curation of trusted medical sources and network effects--selling directly to doctors. I believe frontier labs have no option but to go into verticals (because models are getting commoditized and capability overhang is real and hard to overcome at scale), however, they can only go into so many verticals.
  - simianwords 9mo ago
    > Their value prop is curation of trusted medical sources Interesting. Why wouldn't an LLM based search provide the same thing? Just ask it to "use only trusted sources".
    - tacoooooooo 9mo ago
      They're building a moat with data. They're building their own datasets of trusted sources, using their own teams of physicians and researchers. They've got hundreds of thousands of physicians asking millions of questions everyday. None of the labs have this sort of data coming in or this sort of focus on such a valuable niche
      - simianwords 9mo ago
        > They're building their own datasets of trusted sources, using their own teams of physicians and researchers. Oh so they are not just helping in search but also in curating data. > They've got hundreds of thousands of physicians asking millions of questions everyday. None of the labs have this sort of data coming in or this sort of focus on such a valuable niche I don't take this too seriously because lots of physicians use ChatGPT already.
roysting 9mo ago
Can this really be a kind of herding stampede behavior over Cowork? It’s been out several days now and just all the sudden today, all the traders suddenly got it into their little herd animal heads that everyone should rush to the exists… after that equally sketchy silver and gold rug pull type action last week? Something seems quite off. Am I the only one?
- retube 9mo ago
  Markets are not as efficient as the textbooks would have you believe. Investors typically rely on a fairly small set of analysts for market news and views. It might take those guys a while to think about stuff, write a note etc. The deepseek crash last year lagged by several days as well.
  - andai 9mo ago
    I'm out of the loop, but I thought there were sophisticated automated trading algorithms where people pay to install microwave antennas so they can have 1ms lower latency. And I thought those systems are hooked up to run sentiment analysis on the news. Maybe the news is late?
    - th0ma5 9mo ago
      That is generally only applicable to extremely momentary arbitrage opportunities. There's still a lot of automation though, but it's pretty boring. It's basically look at the news and make a recommendation to a fund manager or something, and various competing vendors of such, down to consumer products like that.
    - retube 8mo ago
      High frequency is the domain of market makers. They are not taking positions in anything (well, only momentarily), they are just matching buyers with sellers. Actual investors move the market, and can be split into "fast money" and "real money". Fast money is basically hedge funds, holding periods typically hours - months depending on the strategy. Real money is the traditional investor base: asset managers, pension funds, sovereign wealth funds, insurers. These guys are much slower: e.g. the investment committee might meet once a quarter, and investment strategy (e.g "we're gonna get a bit longer UK real rates", or "dial US equity allocation down 5%") is often only updated annually.
myth_drannon 9mo ago
Paypal fell 20% today.
- quickthrowman 9mo ago
  PayPal reported an earnings miss and a new CEO before market open today, that’s why it sold off.
- Strongbad536 9mo ago
  pretty sure that was because they brought in a new CEO that the market didn't like
PostOnce 9mo ago
If it turns out that AI isn't much more productive, it could also turn out that people still believe it is, and therefore don't value software companies. If that happens, some software companies will struggle to find funding and collapse, and people who might consider starting a software company will do something else, too. Ultimately that could mean less competition for the same pot of money. I wonder.
- rubyfan 9mo ago
  I left software about 10 years ago for this reason. I saw engineers being undervalued, management barriers to productivity and higher compensation possibilities for non-tech functions.
  - reasonabl_human 9mo ago
    How do you feel about this in retrospect? Those observations sound heavily firm-dependent, but I would be interested in learning which non-tech functions offer higher compensation possibilities
polyglotfacto 9mo ago
So as a software engineer with experience with coding agents, when I look at https://github.com/anthropics/knowledge-work-plugins https://github.com/anthropics/knowledge-work-plugins I'm like: oh that's it, a bunch of skills files? So the value of a skill file is that it tells the model how to format its response for use within the software environment surrounding the model. With programming, it's mostly about how to tell it to use some API. But all the model can do is reply some text, and the actual work needs to be done by the software(the agent harness) which needs to parse the model response and translate it into actual work. My point is there is no magic: the model just reads the skill file and then uses that as a template for a textual response, which is then parsed and processed by traditional software. So in terms of legal skills, a stand-alone skill like the contract review skill at https://github.com/anthropics/knowledge-work-plugins/blob/main/legal/skills/contract-review/SKILL.md https://github.com/anthropics/knowledge-work-plugins/blob/ma... is basically useless. Yes, the model will read it and it will influence its response, but without some extensive software harness around the model to give it data for context and and so on: totaly useless. Why? Because garbage in is garbage out. So telling the model to review a contract and pay attention to "Whether indemnification is mutual or unilateral" will result is some response from the model, but without additional data it will be at the same level as what you can get from a google search. The effect on established companies is exactly zero. Now, having an in-house skills and proprietary software around the model to integrate it into your system, that would be valuable indeed, but not something an AI lab can replicate without building the whole company from scratch.

87 points by garbawarb 9mo ago

XiS 9mo ago

https://archive.li/VyN2H https://archive.li/VyN2H

epicureanideal 9mo ago

Could this lead to more software products, more competition, and more software engineers employed at more companies?

rishabhaiover 9mo ago
maybe eventually, not in the near-term future.
unyttigfjelltol 9mo ago
It’s demonetizing process rent-seeking. AI can build whatever process you want, or some approximation of it.
garbawarb 9mo ago
I kind of imagine more people going off and building their own companies.
- DougN7 9mo ago
  I think so too. But because of code quality issues and LLMs not handling the hard edge cases my guess is most of those startups will be unable to scale in any way. Will be interesting to watch.
- danans 9mo ago
  Not if they don't have access to capital. Lacking that, they won't be building much of anything. And if there a lot of people seeking capital, it gets much harder to secure. Capital also won't be rewarded to people who don't have privileged/proprietary access to a market or non-public data or methods. Just being a good engineer with Claude Code isn't enough.
fishpham 9mo ago
I think the argument is that tools like Claude Code will cause more companies to just build solutions in-house rather than purchase from a vendor.
- groceryheist 9mo ago
  This is correct. AI is a huge boon for open source, bespoke code, and end-user programming. It's death for business models that depend on proprietary code and products bloated with features only 5% of users use.
  - hugs 9mo ago
    possibly also a boon for automated testing tools and infra designed for ai-driven coding.
guluarte 9mo ago
I think companies will need to step up their game and build more competitive products with more features, less buggy and faster than what people can build
danans 9mo ago
> Could this lead to more software products, more competition, and more software engineers employed at more companies? No, it will just lead to the end of the Basic CRUD+forms software engineer, as nobody will pay anyone just for doing that. The world is relatively satisfied with "software products". Software - mostly LLM authored - will be just an enabler for other solutions in the real world.
- falloutx 9mo ago
  There are no pure CRUD engineers unless you are looking at freelance websites or fiver. Every tiny project becomes a behemoth of spaghetti code in the real world due to changing requirements. > The world is relatively satisfied with "software products". you can delete all websites except Tiktok, Youtube and PH, and 90% of the internet users wouldnt even notice something is wrong on the internet. We dont even need LLMs, if we can learn to live without terrible products.

gip 9mo ago

I'm not really understanding why Thomson Reuters is at direct risk from AI. Providing good data streams will still be very valuable?

robotswantdata 9mo ago
Huge legal tech business units
yodon 9mo ago
If customers start asking Claude first, before they ask Thomson Reuters, that's a big risk for the later company.
- gip 9mo ago
  Got it, thank you for the insight. The assumption is that Claude has access to a stream of fresh, currated data. Building that would be a different focus for Anthropic. Plus Thomson Reuters could build an integration. Not totally convinced that is a major threat yet.
  - disgruntledphd2 9mo ago
    It's definitely not a major threat, but many/most finance people are clueless about what is and isn't possible with LLMs. Again, unless Anthropic are taking on liability for their legal tools, this is not going to impact TR. That being said, there probably is a potential company here that's gonna be built soon/is currently being built, but it definitely won't just be a wrapper around Claude as the recall will be way too low for these systems unaided.
whitej125 9mo ago
TR will not disappear. But their value to the market was "data + interface to said data" and that value prop is quickly eroding to "just the data". You can be a huge, profitable data-only company... but it's likely going to be smaller than a data+interface company. And so, shareholder value will follow accordingly.

deleted 9mo ago

[deleted]

simianwords 9mo ago

I came across this company called OpenEvidence. They seem to be offering semantic search on medical research. Founded in 2021. How could it possibly keep up with LLM based search?

dnw 9mo ago
It is a little more than semantic search. Their value prop is curation of trusted medical sources and network effects--selling directly to doctors. I believe frontier labs have no option but to go into verticals (because models are getting commoditized and capability overhang is real and hard to overcome at scale), however, they can only go into so many verticals.
- simianwords 9mo ago
  > Their value prop is curation of trusted medical sources Interesting. Why wouldn't an LLM based search provide the same thing? Just ask it to "use only trusted sources".
  - tacoooooooo 9mo ago
    They're building a moat with data. They're building their own datasets of trusted sources, using their own teams of physicians and researchers. They've got hundreds of thousands of physicians asking millions of questions everyday. None of the labs have this sort of data coming in or this sort of focus on such a valuable niche
    - simianwords 9mo ago
      > They're building their own datasets of trusted sources, using their own teams of physicians and researchers. Oh so they are not just helping in search but also in curating data. > They've got hundreds of thousands of physicians asking millions of questions everyday. None of the labs have this sort of data coming in or this sort of focus on such a valuable niche I don't take this too seriously because lots of physicians use ChatGPT already.

roysting 9mo ago

Can this really be a kind of herding stampede behavior over Cowork? It’s been out several days now and just all the sudden today, all the traders suddenly got it into their little herd animal heads that everyone should rush to the exists… after that equally sketchy silver and gold rug pull type action last week? Something seems quite off. Am I the only one?

retube 9mo ago
Markets are not as efficient as the textbooks would have you believe. Investors typically rely on a fairly small set of analysts for market news and views. It might take those guys a while to think about stuff, write a note etc. The deepseek crash last year lagged by several days as well.
- andai 9mo ago
  I'm out of the loop, but I thought there were sophisticated automated trading algorithms where people pay to install microwave antennas so they can have 1ms lower latency. And I thought those systems are hooked up to run sentiment analysis on the news. Maybe the news is late?
  - th0ma5 9mo ago
    That is generally only applicable to extremely momentary arbitrage opportunities. There's still a lot of automation though, but it's pretty boring. It's basically look at the news and make a recommendation to a fund manager or something, and various competing vendors of such, down to consumer products like that.
  - retube 8mo ago
    High frequency is the domain of market makers. They are not taking positions in anything (well, only momentarily), they are just matching buyers with sellers. Actual investors move the market, and can be split into "fast money" and "real money". Fast money is basically hedge funds, holding periods typically hours - months depending on the strategy. Real money is the traditional investor base: asset managers, pension funds, sovereign wealth funds, insurers. These guys are much slower: e.g. the investment committee might meet once a quarter, and investment strategy (e.g "we're gonna get a bit longer UK real rates", or "dial US equity allocation down 5%") is often only updated annually.

myth_drannon 9mo ago

Paypal fell 20% today.

quickthrowman 9mo ago
PayPal reported an earnings miss and a new CEO before market open today, that’s why it sold off.
Strongbad536 9mo ago
pretty sure that was because they brought in a new CEO that the market didn't like

PostOnce 9mo ago

If it turns out that AI isn't much more productive, it could also turn out that people still believe it is, and therefore don't value software companies. If that happens, some software companies will struggle to find funding and collapse, and people who might consider starting a software company will do something else, too. Ultimately that could mean less competition for the same pot of money. I wonder.

rubyfan 9mo ago
I left software about 10 years ago for this reason. I saw engineers being undervalued, management barriers to productivity and higher compensation possibilities for non-tech functions.
- reasonabl_human 9mo ago
  How do you feel about this in retrospect? Those observations sound heavily firm-dependent, but I would be interested in learning which non-tech functions offer higher compensation possibilities

polyglotfacto 9mo ago

So as a software engineer with experience with coding agents, when I look at https://github.com/anthropics/knowledge-work-plugins https://github.com/anthropics/knowledge-work-plugins I'm like: oh that's it, a bunch of skills files? So the value of a skill file is that it tells the model how to format its response for use within the software environment surrounding the model. With programming, it's mostly about how to tell it to use some API. But all the model can do is reply some text, and the actual work needs to be done by the software(the agent harness) which needs to parse the model response and translate it into actual work. My point is there is no magic: the model just reads the skill file and then uses that as a template for a textual response, which is then parsed and processed by traditional software. So in terms of legal skills, a stand-alone skill like the contract review skill at https://github.com/anthropics/knowledge-work-plugins/blob/main/legal/skills/contract-review/SKILL.md https://github.com/anthropics/knowledge-work-plugins/blob/ma... is basically useless. Yes, the model will read it and it will influence its response, but without some extensive software harness around the model to give it data for context and and so on: totaly useless. Why? Because garbage in is garbage out. So telling the model to review a contract and pay attention to "Whether indemnification is mutual or unilateral" will result is some response from the model, but without additional data it will be at the same level as what you can get from a google search. The effect on established companies is exactly zero. Now, having an in-house skills and proprietary software around the model to integrate it into your system, that would be valuable indeed, but not something an AI lab can replicate without building the whole company from scratch.