Dario Amodei, Anthropic’s CEO, predicted that AI could write 90% of code in 3-6 months. If this materializes, the role and responsibilities of software engineers will continue to evolve quickly.
As of Q2 2025, Anthropic’s models are considered best-in-class for code generation. With high performance, these models are heavily used in code generation tools like Replit. Pundits will not have accurate future-date predictions on the percentage of code being written by AI, but we can acknowledge that this rate continues to increase quarter after quarter as more enterprises adopt AI.
This inserts an innovator’s dilemma issue (Christensen) related to what can happen to the software product and services industry. If an incumbent software development company's business model is based on charging hourly rates for development services (time and materials model), then additional productivity could mean fewer hours billed for the same work, therefore reducing revenue (same P, lower Q). This can be the inverse for companies that charge fixed fees for feature delivery (same revenue, lower costs).
Some companies may react by not adopting code generation tools because of their lower perceived quality today (performance is increasing by leaps and bounds). This may hinder business performance 1-2 years out as these tools become a de facto standard for the industry. Some other companies may resist cannibalizing their existing, profitable services performed by human developers. This underinvestment today can have a significant impact down the line.
As we look back on 2025, what may have been “good enough” for niche applications becomes superior and more cost-effective for a broader range of software products and projects. Continue to invest in innovation and reimagine the role of the software architect.
Alten Capital invests in technology services businesses. Please reach out to explore potential partnerships.