The impact of Claude Cowork, an agentic artificial intelligence (AI) tool launched by Anthropic which can automate enterprise processes across functions, has triggered a debate about its possible fallout on the Indian IT and the software as a service (SaaS) industry.
Some executives and investors said that such tools are unlikely to have a huge impact on software businesses in the short-term, and that there is an opportunity to accelerate AI development. Others said that Indian IT companies have failed to innovate beyond the low-end outsourcing model and this will sound their death knell. They cautioned that companies and startups need to innovate and keep up with the momentum to stay in business.
This follows global tech and software companies losing close to $300 billion in market value when Anthropic announced Claude Cowork, an agentic AI tool, over fear that it will replace the human workforce.
“What Anthropic is saying is that there is no need for expensive SaaS and cloud, you can replace it with cloud native software and Agentic AI. But that is not going to happen on its own, you need people to do it,” R Srikrishna, chief executive of Hexaware Technologies, told ET.
Samir Arora, founder of Helios Capital Management, wrote on the microblogging site X that "Indian IT companies cannot see beyond their nose--they only worry about next quarter's orders and guidance and if there is visibility for that they feel confident.”
Others said that IT companies have been conserving cash and giving back only through buybacks instead of making bold futuristic bets in IP creation, which could have made them futureproof.
The comments received a strong rebuttal from former Infosys CFO Mohandas Pai, who responded to the online debate and said there is a difference between service and product companies. “These are service cos like Accenture is--very successful. They will get AI for global enterprises soon,” he wrote on X, arguing that the local market for Indian product companies is still very small. “For product cos you need large local markets, huge capital, large economy... all of which India lacks even today.”
Meanwhile, Sridhar Vembu, cofounder and chief scientist of SaaS firm Zoho, echoed the sentiment on the site, saying “an industry that spends vastly more on sales and marketing than on engineering and product development was always vulnerable”. “Can Zoho survive the AI wave? It depends on our ability to adapt. I always ask our employees to calmly contemplate our death,” he said.
Dev Khare, partner, LightSpeed India, told ET that in terms of IT services, what is different is that large enterprises around the world will require companies that can assure quality and maintain it over time.
Some executives and investors said that such tools are unlikely to have a huge impact on software businesses in the short-term, and that there is an opportunity to accelerate AI development. Others said that Indian IT companies have failed to innovate beyond the low-end outsourcing model and this will sound their death knell. They cautioned that companies and startups need to innovate and keep up with the momentum to stay in business.
This follows global tech and software companies losing close to $300 billion in market value when Anthropic announced Claude Cowork, an agentic AI tool, over fear that it will replace the human workforce.
“What Anthropic is saying is that there is no need for expensive SaaS and cloud, you can replace it with cloud native software and Agentic AI. But that is not going to happen on its own, you need people to do it,” R Srikrishna, chief executive of Hexaware Technologies, told ET.
Samir Arora, founder of Helios Capital Management, wrote on the microblogging site X that "Indian IT companies cannot see beyond their nose--they only worry about next quarter's orders and guidance and if there is visibility for that they feel confident.”
Others said that IT companies have been conserving cash and giving back only through buybacks instead of making bold futuristic bets in IP creation, which could have made them futureproof.
The comments received a strong rebuttal from former Infosys CFO Mohandas Pai, who responded to the online debate and said there is a difference between service and product companies. “These are service cos like Accenture is--very successful. They will get AI for global enterprises soon,” he wrote on X, arguing that the local market for Indian product companies is still very small. “For product cos you need large local markets, huge capital, large economy... all of which India lacks even today.”
Meanwhile, Sridhar Vembu, cofounder and chief scientist of SaaS firm Zoho, echoed the sentiment on the site, saying “an industry that spends vastly more on sales and marketing than on engineering and product development was always vulnerable”. “Can Zoho survive the AI wave? It depends on our ability to adapt. I always ask our employees to calmly contemplate our death,” he said.
Dev Khare, partner, LightSpeed India, told ET that in terms of IT services, what is different is that large enterprises around the world will require companies that can assure quality and maintain it over time.