Notwithstanding the eye popping valuations of Anthropic, OpenAI and the others the crazy valuations are unsustainable. I am an AI entrepreneur and technologist. I understand the technology and believe that AI is truly revolutionary but it kills the software model completely.
Software margins are based on build once and make a zillion copies at nearly zero cost. Agreed that SaaS does introduce costs related to hosting but still margins are 90%. AI introduces token costs for the user and for the vendor. On the user side, token costs create a cost variable that increase with use and on the vendor side, more tokens mean more hardware. This kills the incentive to use for the user and the margins for the vendor.
We are now in a honeymoon phase with AI .. once the AI bills pile up, there will be a move to use AI where it is essential and/or settle for lower cost models. All this will impact the usage of high cost frontier models which is the basis for the AI Bubble.