"On August 20, 2011, legendary venture capitalist Marc Andreessen published a blog post-and an accompanying essay in The Wall Street Journal-that would become the sacred texts of the Silicon Valley bull run. Titled "Why Software Is Eating The World," he argued that the global economy was undergoing a "dramatic and broad technological and economic shift" and that software companies were poised to take over large swathes of the industry."
"Fifteen years later, in February 2026, Andreessen's prophecy has been fulfilled in a manner that even the biggest bulls failed to predict. Software did indeed eat retail (Amazon), video (Netflix), music (Spotify), and telecommunications (Skype) just as Andreessen predicted, but the market got a $1 trillion shock in February because something was eating software itself. That something, of course, was artificial intelligence."
"Morgan Stanley's software analysts, led by Keith Weiss, offered a "gut check" this week in a major research note, arguing that "AI IS software" but also that software is growing so all-consuming that it is indeed starting to eat work itself. Andreessen's a16z has a core strategy of investing across enterprise software, including cloud, security and software-as-a-service (SaaS), but the $1 trillion-plus selloff dubbed the "SaaSpocalypse" cuts to the very heart of that model."
Marc Andreessen published 'Why Software Is Eating The World' in 2011, predicting software would displace traditional industries. By February 2026, software had transformed retail, video, music, and telecommunications through companies like Amazon, Netflix, Spotify, and Skype. Artificial intelligence then began displacing software's role, causing a $1 trillion-plus market selloff labeled the 'SaaSpocalypse.' Morgan Stanley analysts stated that 'AI IS software' and warned that software is becoming so pervasive it is starting to replace work itself. Venture firm a16z's enterprise software strategy faces strain as cloud, security, and SaaS valuations and business models come under pressure.
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