The token efficiency argument only holds for teams paying per API call. Cursor, Copilot, and most tools developers actually use are flat subscription. On a flat monthly fee, there's no economic pressure toward brevity in generated code.
This is what happens to every software valuation when production cost drops to near zero. The moat was never the code. Companies still pricing themselves on engineering effort are going to have a rough conversation with investors once any competitor can replicate the core product in a weekend. The only things that still hold are proprietary data and distribution lock-in.
Your plumber story is exactly what trips up most vertical AI pitches I see. The founder assumes every missed call is lost revenue, but for capacity-constrained shops, a missed call is just triage they did not have to do. Curious if anyone has seen an AI receptionist actually grow a shop's revenue vs just adding a layer on top of an already-full queue.
Satellite imagery companies spent a decade learning that raw data is a commodity and the margin lives in the analytics layer. If you're explicitly ceding that layer to partners, what stops a well-funded competitor from replicating the pad network and undercutting you on collection price?
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