AI needs no introduction. It seems to have taken over the world in the last three months – at least, the business world.
Looking back, this may be the seminal ‘Skynet’ moment of singularity!
Regardless, things are changing fast.
There is a lot of talk of AI replacing jobs, but it all seemed a distant prospect – until Open AI’s LLM came knocking. Now, for some roles, job destruction appears imminent and inevitable.
Without realizing it, software and SaaS have already automated away many millions of jobs – without a second thought.
Excel has automated and removed endless manual calculations. CAD software has removed the need for much architectural work. Email and CRMs have automated sales processes, and Xero has streamlined a lot of accounting.
Typical pricing models for SaaS and software are (i) monthly subscriptions or (ii) volume-based pricing.
Software can make a ton of money because the marginal cost of additional users is very low. Once they cover the fixed cost of building the software, every new user is (almost) pure milk and honey. This allows them to charge low monthly fees for pretty amazing solutions.
If a software company can reach scale, then it’s a great value proposition for both company, and client.
AI Agents for hire
Today, I saw what is essentially the first ‘AI agent’ for hire.
This service was offered by a well-known tech-sector SaaS, called Intercom.com. If interested, it’s intercom.com/fin [free plug].
They offer customer service resolutions using AI bots.
What struck me was not the product but the pricing. It represented a big break from traditional software solutions
Intercom’s Fin has taken a different approach to traditional software pricing. They are charging per ‘case resolution.’
This model is akin to human labor, where deliverables are based either on output or hours of productivity.
So Intercom has developed an AI agent, based on a software cost structure, but is charging based on a human agent. Or put another way: software bots, asking human-like salaries.
If they manage to sell this, then they will enjoy astronomical margins.
Beginning of the end?
This is an early example of an AI agent offering to replace a human agent function. And while 99c is very expensive for software, it is possibly very cheap compared to the human alternative.
The pricing change is a small nuance, but it signals much more.
Maybe this is just another software release.
Or maybe it’s the beginning of human-replacing automation?
The question for your business
Have you made early moves to integrate AI agents into your business?