Is Anthropic's new AI tool really a threat to software and IT companies?

Anthropic AI has sent shockwaves in software companies with the launch of its new AI tool, Claude co-work. Many in the IT and software industry say it is a Deepseek 2.0 moment for the IT companies, who are now under constant threat of AI’s breakthroughs. Since the launch of Chat GPT, Google’s Gemini, Perplexity and others, the software services company witnessed a structural change in the dynamics of the industry.

Since the launch of AI, the IT and software industry has witnessed massive de-rating as the AI advancement can disrupt the industry. However, the Indian IT companies have started adopting active AI implementation across enterprise level. With every new launch of AI models like Claude Co-work, the threat keeps haunting IT companies about their future. Is it true this time?. Here is what Industry leaders say.

Jensen Huang, Nvidia CEO

As IT and software stocks were witnessing a sharp plunge across the US and India, Jensen Huang’s comment came as a major relief. While speaking at the AI conference hosted by Cisco, Jensen Huang was asked about the prospects of AI disrupting the existing software companies and making their business models obsolete. Jensen Huang refuted the claims made by Anthropic AI’s new model. He said, “It is the most illogical thing in the world, and time will prove itself.”

He added, “If you were a human or robot, artificial, general robotics, would you use tools or reinvent tools? The answer, obviously, is to use tools.” Huang asserted that the latest breakthroughs in AI are about tool use. These tools work with operating systems, database frameworks, developer platforms and enterprise software to function; without these, the AI tools also become explicit.

Ravi Kumar, Cognizant CEO

While addressing the press conference on the quarterly earnings for the company, Ravi was asked about the anxiety amongst the industry participants about the software business model after the launch of Anthropic AI’s Claude Co-work model. The CEO said, “The claims that an AI model will be plugged into an enterprise and it will generate output like magic are highly misplaced.

He further added, “ If that's the case, why hasn't the value drifted into enterprises in the last three years, particularly after the launch of Chat GPT.

Sridhar Vembu, Zoho Founder

Amid the market rout of software services companies, which is also termed as ‘SaaScolaypse’, Sridhar Vembu, founder and Chief Architect of Zoho, said that the market's negative reaction over the latest breakthrough in AI models is a moment of reckoning that the consolidation in the IT industry was long overdue. The companies spent more on marketing and sales than on engineering and product development, which has created inflation in the industry.

“The venture capital bubble and then the stock market bubble funded a fundamentally flawed, unsustainable model for too long. AI is the pin that is popping this inflated balloon”, said the founder in his X post.

On commenting on the impact of this development on Zoho, he said, “Can Zoho survive the AI wave? It depends on our ability to adapt. I always ask our employees to calmly contemplate our death. When we accept that possibility, we become more fearless, and that is when we can calmly chart our course”

Conclusion

In conclusion, the voices are mixed by the industry leaders on the impact of breakthroughs in AI and its impact on software companies. However, investors across the world sound cautious as threats like these are expected to pop up again and again in the coming future, unless the company themselves work on breakthroughs for the industry. Whether AI will replace the software services or not, only time will tell, but the unit economics of the software industry is surely expected to change, with AI offering the value at a fraction of the cost, and that's the bigger cause of worry for investors.