Anthropic's release of Claude Code Security, a tool designed to identify software vulnerabilities, triggered a sell-off in cybersecurity stocks. Investors appear concerned about the potential impact of AI on existing workflows, leading to significant drops in the share prices of companies like CrowdStrike, Cloudflare, SailPoint, and Okta. The article explores the 'SaaSpocalypse' phenomenon, discussing the market's reaction, the narratives driving investment decisions, and the potential implications of AI replacing human workers.
Yesterday, Anthropic released a new capability for Claude Code: Claude Code Security . Claude Code can now, theoretically, dig around in your codebase and find potential vulnerabilities., Anthropic says this tool solves a problem: “too many software vulnerabilities and not enough people to address them.
” The vulnerabilities flagged via Claude Code Security are accompanied by offers of “targeted software patches for human review,” the post says.. It’s almost like investors didn’t read all that stuff in the blog post about how this tech is supposed to accentuate existing workflows, and help, rather than replace, workers. Per Bloomberg, the companies whose stock was sold off included CrowdStrike and Cloudflare which declined by 8% and 8.1% respectively. SailPoint declined a very concerning 9.4%. Okta went down 9.2%. And there were others. The relevant companies may be especially vulnerable because some have automated research software that truly does sound like it could be made redundant by Claude Code Security, assuming it’s proven actually useful and superior. CrowdStrike, for instance,The Wall Street trend in which investors unload a given software stock the millisecond Anthropic announces a new Claude Code capability is known as the SaaSpocalypse. The SaaSpocalypse is just a narrative, and leads to all sorts of cloudy thinking. It is, for instance, more than a bit overblown to say,This tweet from Claude AI just wiped out over $15 BILLION from cybersecurity stocks.But investment isn’t based entirely on a rational assessment of the future value of a company. It’s also based on narratives, and how investors expect other investors to respond to them, and how investors expect other investors to respond to the expectations of other investors, and on, and on.the SaaSpocalypse “the most illogical thing in the world” at a conference about two weeks ago. Huang’s counter-narrative, however, is also a bit fanciful. He implies that AI agents will operate like humans and simply use human tools. “If you were a humanoid robot, would you use a screwdriver or invent a new screwdriver?” he said., have a lot of potential as tools that could make for better overall results if added to existing processes. “But no one is investing hundreds of billions in AI companies because they think AI will make radiology more expensive, not even if also makes radiology more accurate,” Doctorow said. Replace the concept of radiology with “cybersecurity” as you read the rest of this: “The market’s bet on AI is that an AI salesman will visit the CEO of Kaiser and make this pitch: “Look, you fire 9/10s of your radiologists, saving $20m/year, you give us $10m/year, and you net $10m/year, and the remaining radiologists’ job will be to oversee the diagnoses the AI makes at superhuman speed, and somehow remain vigilant as they do so, despite the fact that the AI is usually right, except when it’s catastrophically wrong.” In other words, jobs are cut, quality degrades, and the job of the human in the loop becomes, essentially, blame-taker when something inevitably goes wrong. And keep in mind that to an investor, it’s not a worse company if cutting 90% of payroll leads to a worse result for the customer, but a more profitable company overall.11:00 am
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