Week 37 news

The end of SaaS as we know it

We have written about Klarna, the Swedish fintech giant, multiple times over the last few weeks, especially with their bold move to replace 50% of their workforce through the smart use of AI. A news article that was easily missed, was that Klarna, recently announced its decision to shut down its Salesforce service provider. What’s more, Workday, another major SaaS platform, is set to meet the same fate. This bold step by Klarna isn’t just a cost-cutting measure; it’s a harbinger of a seismic shift in the world of software as a service (SaaS) and artificial intelligence (AI).
Klarna’s decision to replace these established SaaS solutions with in-house AI alternatives marks a pivotal moment in the ongoing narrative of AI’s impact on the software industry. At ExoBrain, we see three distinct phases in the disruption of the traditional SaaS model through AI.

The first phase – and currently well underway – is AI-enhanced SaaS. AI acts as a powerful ally to existing SaaS solutions. Companies like Quest Labs have been at the forefront, leveraging AI to supercharge their SaaS offerings. These enhancements have ranged from more intuitive user interfaces and personalized experiences to advanced predictive analytics and automated customer support. It’s a world where AI complements and extends the capabilities of traditional SaaS, driving unprecedented growth and efficiency.

But Klarna’s recent move signals the opening of a new, more disruptive phase. This is the era of SaaS replacement, where AI doesn’t just enhance existing software—it replaces it entirely. Klarna’s decision to develop in-house AI solutions in lieu of established SaaS products like Salesforce and Workday is a prime example of this trend. It’s a bold bet on the power of AI to deliver more customized, efficient, and cost-effective solutions than off-the-shelf SaaS products. As AI tools become more sophisticated and accessible, more companies may follow Klarna’s lead, opting for bespoke AI solutions over traditional SaaS products. This trend poses a significant challenge to the conventional SaaS business model and could reshape the entire industry.

But the story doesn’t end there. As we peer into the future, we can glimpse the outlines of a third stage—one that could redefine the very concept of software itself. In this not-unlikely future, dramatic increases in computing power will enable AI to generate user-friendly interfaces on the fly, interacting directly with data in ways that bypass traditional application structures entirely. While this final chapter remains theoretical for now, early signs suggest we’re moving in this direction. The implications are profound: not only could traditional SaaS applications become obsolete, but the entire paradigm of software development and use could be transformed.

As this story unfolds, it’s clear that the relationship between AI and SaaS is far from simple. While AI-enhanced SaaS products continue to thrive in the present, forward-thinking companies like Klarna are already writing the next chapter. And beyond that lies a future where the very nature of software may be redefined.

Takeaways: For SaaS companies, adapting to these changes will be crucial for survival. For businesses relying on SaaS solutions, staying informed about these trends will be essential for making strategic technology decisions. As we continue to watch this story develop, one thing is certain: the intersection of AI and SaaS will remain a focal point of innovation and disruption in the tech world for years to come. In the end, Klarna’s decision may be remembered not just as a bold move by a single company, but as a turning point in the broader narrative of AI’s impact on software.

From cat to election memes

This week, it is REALLY hard not to write about cat memes, as we have found the illegal immigrant population is consuming the feline populations. And with that, it is hard not to say ‘told you so!’. It was just a few weeks where ExoBrain presented the world with a marvel of a cat meme created using Flux.1 (integrated with Grok, thus X). As expected with that very cat image, AI has become a central player in the 2024 election cycle, with implications that extend far beyond November.
So lets take a little look at the landscape. Who uses AI in the 2024 US elections?

The Russians use it: US intelligence reports suggest that Moscow is leveraging advanced AI techniques to boost Trump’s chances in the 2024 race. Unlike previous election cycles, these efforts are more refined, integrating “authentic American voices” and using AI to generate content rapidly and convincingly. The focus on swing states and the use of influence firms adds layers of complexity to this digital manipulation.

The candidates (likely) use it: While it’s unclear to what extent the republicans and democrats themselves are using AI, its presence is undeniable. From deepfake videos to AI-generated campaign materials in so-called MAGA land, the line between reality and digital fabrication is blurring. The potential for personalized propaganda tailored to individual voters’ psychological profiles raises alarming ethical questions. It could well be that content is created by enthusiastic political followers, not unimaginable given how polarised US politics has become, but it is hard not to imagine active engagement.

Musk uses it: Elon Musk’s AI chatbot, Grok, integrated with X (formerly Twitter), has already stirred controversy. Its “anti-woke” stance and tendency to give “spicy” answers have led to the spread of misinformation about election procedures. The swift response from election officials highlights the ongoing battle between AI-generated content and factual information.

Taylor uses it (as an argument):  In a surprising turn of events, pop icon Taylor Swift cited fears around AI as a key factor in her endorsement of Kamala Harris. Swift’s concern over AI-generated deepfakes falsely depicting her endorsement of Trump underscores the technology’s potential to manipulate public opinion on a massive scale.

Beyond November: The Long-Term Impact? The influence of AI on elections won’t end with the final vote count. Experts warn that AI could become a convenient scapegoat for whichever candidate loses, potentially fuelling further distrust in the democratic process. The technology’s ability to generate convincing fake content may lead to prolonged disputes over election results and deepen existing political divides. Not to mention eroding public trust.

Takeaways: As we navigate this new era of AI-influenced elections, several key questions emerge:

1. How can we maintain the integrity of democratic processes in the face of increasingly sophisticated AI manipulation?
2. What role should tech companies play in regulating AI-generated content on their platforms?
3. How can voters be educated to critically evaluate the information they encounter online?
4. What legal and ethical frameworks need to be developed to address the use of AI in political campaigns?

The convergence of AI and politics is no longer a distant future scenario – it’s our present reality. From cat memes to election memes, AI’s influence continues to grow, challenging our perceptions and testing the resilience of our democratic institutions. As we move forward, vigilance, education, and adaptive regulation will be key to ensuring that AI enhances rather than undermines our political processes.

At ExoBrain, we remain committed to monitoring these developments and providing insights to help navigate this complex landscape. The future may be AI-driven, but it’s up to us to steer it in the right direction.