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The Economics of AI Usage and What's Next For SaaS | Benedict Evans on a16z
8 segments available
Erik Torenberg speaks with tech analyst Benedict Evans about the current state of AI, what has changed over the past year, and which questions remain unanswered. The conversation covers coding agents, foundation models, AI infrastructure spending, software economics, and the tension between today's AI excitement and the long-term realities of technology adoption. Evans discusses why coding has emerged as AI's first breakout use case, how previous platform shifts can help frame the current moment, and why many of the most important questions about AI remain unresolved. Along the way, they explore the future of software, enterprise adoption, consumer behavior, and whether AI models ultimately capture value themselves or become infrastructure for the next generation of applications. Timestamps: 00:00 - Intro 00:44 - What's Changed Since Last Year 05:53 - OpenAI vs Anthropic Strategy 10:31 - The Pricing Crunch & Platform History 22:48 - What Comes After Coding 38:18 - AI & the Future of Enterprise Software 48:43 - The CapEx Problem 55:07 - Will Models Become Commodities? Resources: Follow Benedict Evans on X: https://x.com/benedictevans Follow Erik Torenberg on X: https://x.com/eriktorenberg Read Content Isn’t King: https://www.ben-evans.com/benedictevans/2017/7/13/content-isnt-king Read Netflix is Not a Tech Company: https://www.ben-evans.com/benedictevans/2019/7/31/Netflix Stay Updated: If you enjoyed this episode, be sure to like, subscribe, and share with your friends! Find a16z on X: https://twitter.com/a16z Find a16z on LinkedIn: https://www.linkedin.com/company/a16z Listen to the a16z Show on Spotify: https://open.spotify.com/show/5bC65RDvs3oxnLyqqvkUYX Listen to the a16z Show on Apple Podcasts: https://podcasts.apple.com/us/podcast/a16z-podcast/id842818711 Follow our host: https://x.com/eriktorenberg Please note that the content here is for informational purposes only; should NOT be taken as legal, business, tax, or investment advice or be used to evaluate any investment or security; and is not directed at any investors or potential investors in any a16z fund. a16z and its affiliates may maintain investments in the companies discussed. For more details please see http://a16z.com/disclosures.
Segments Timeline
Intro
"Agentic coding went from being kind of useful to really changing everything. It was going to be magic. And in 20 years time, we'll just say, "Well, of course that's how it is. Computer's always done t..."
What's Changed Since Last Year
">> Benedict. Welcome back to the Acing Z podcast. >> Thank you. >> Last time you were here, we were discussing the first iteration of your presentation AI use the world. Uh you know, you since wrote i..."
OpenAI vs Anthropic Strategy
">> Well, you know, it's always been such a such a a tranquil drama-free environment. So, you know, it's and you know, obviously they've had the issue with with with Fiji Simo having to take a medical ..."
The Pricing Crunch & Platform History
"the the third point point here is and you know there's a much more tangible observation is that the the pricing crunch that we've already mentioned looks to me a lot like what happened with mobile dat..."
What Comes After Coding
"demand for bits is infinite. It's grown 1500 2x in the last 15 years. But you still got your supply and dem price equilibrium and you still got a murderous price war between Telkos in most parts of th..."
AI & the Future of Enterprise Software
"earth. Like is a SAS industry going to be less consolidated, Benedict? That's all great, but like tell us about the stocks. Um, what are the kind of building blocks that we can put down here? So, obvi..."
The CapEx Problem
"you know we think of telecoms as being capital intensive. telecom spend instead of 15 to 20% of revenue on capex. Um and so you know $700 billion is the guidance from the big four companies this year...."
Will Models Become Commodities?
"big part of your thesis is this idea that models are going to end up as commodities and yet the you know the layer that's raising the most money uh you know in the in the fastest time in history is th..."