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In 2026, the software industry is facing a major crisis as Artificial Intelligence (AI) begins to "eat" traditional software. High-profile Israeli companies like Wix, monday.com, and Nice have seen their market values drop significantly as investors fear that AI agents will make standard software subscriptions obsolete.
The article highlights several key shifts:
- Vibe Coding: Non-programmers are using natural language to build custom tools, leading some companies to cancel expensive contracts with giants like Salesforce.
- Market Correction: The "Magnificent Seven" tech giants are thriving, but the SaaS (Software as a Service) index has fallen, with investors now favoring hardware and chip sectors.
- New Business Models: Experts suggest the era of "hypergrowth" is over. Future software companies may be smaller, more profitable, and priced based on results rather than the number of users.
While traditional "sticky" systems (like accounting software) won't vanish overnight, the industry must pivot from selling tools to selling AI-generated outcomes to survive.
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Discussion
In the future, companies might pay software providers only when they get a good result, instead of paying a monthly fee. Do you think this is a better way to do business?
With AI, people can build apps just by speaking or typing in plain English. How does this change the job of a professional software developer?
One expert said AI can make a worker 10 times faster. If your client’s team becomes 10 times faster, should they fire staff or find new projects for them?
The article says hardware (like computer chips) is becoming more important than software apps. Why do you think investors are excited about 'physical' technology right now?
If AI does the boring, repetitive tasks, what skills will human employees need to stay valuable in a company?