A single tweet about Claude Code knocked about 5% off SaaS stocks. The author's point: the market is pricing the cost of writing code, which was never the expensive part of running a software business.
Jevons' Paradox cuts the other way here. As building software gets dramatically cheaper, demand for software expands dramatically. Cheap production grows the market rather than deleting it.
Customer lock-in gets stronger, not weaker. Once a vendor's AI has been tuned on years of your specific workflows, switching means throwing away that accumulated tuning, not just migrating data.
The industry already ran this transition once: on-premises to cloud SaaS. Margins and delivery models changed, the business didn't end. Cloud to AI-native is the same shape of move.
Nobody vibe-codes their own payroll platform, and capability isn't the blocker. It's the compliance and security exposure of running a bespoke system that no auditor has ever certified.
Why it matters
The counter-take to "AI killed SaaS": code generation is cheap, but maintenance, compliance, and trust are not — and that is where the business actually lives. Worth reading before you bet a roadmap on the "software is free now" narrative.
Key quotes
“Just two weeks ago, a single tweet about Claude Code was enough to wipe five percent off SaaS stocks.”
“The leap from “the old SaaS model is being disrupted” to “no one will sell software anymore” is a distinct flavor of foolishness.”
“They are living systems that require maintenance, verification, security, compliance, and ongoing refinement.”
“We went from on-premises software to cloud SaaS and the world didn’t end; it expanded.”
