Navigating IT Spending and AI’s Impact on Enterprise Software | TSG Ep. 906

Hey, everyone, what's the state of it spending? I guess it depends what state you're in. You're watching Tech Strung Gang.

Hi everyone, happy Wednesday. It's Alan Shimel here, and we've got another great Textron gang to spin up for you. As usual, we have three blocks of interesting stories, and we've got, let's just say, a very interesting crew, a gang crew here to, to talk about them.

Let me quickly introduce you to our gang for this beautiful Wednesday. We've got Chris Blask, Kate Scarcella, Dan O'Brien, Dan o Mitch Ashley, and of course the dean, Mike Vizard gang. Welcome.

I hope we're ready to, uh, dig right into it today. It's a, it's a busy Wednesday and, you know, hey, it's, these are the dog days of summer, but the news isn't slowing down. There's stuff flying all over the place.

Studies of people getting ready for events. Of course, a lot of agents, secret agents, AI agents, whatever. Mike, talk to us.

What do we got? Well, let's start out today with a pair of reports that came out from the Futurum Group. And one is talking about, and maybe not surprisingly, that well, there's gonna be a lot more spending on enterprise software thanks to ai.

But the other one was a study of what CIOs are thinking. And a lot of them are kind of approaching this maybe with a more flexibility in their mind than I've seen in recent times. A lot of them are reconsidering or at least thinking about where they might deploy workloads while also apparently trying to consolidate the number of platforms they have to manage to reduce costs.

And of course, they, they have to find ways to fund ai. Dan, you of course, are closely tied to a lot of these reports, but is this business as usual in your mind, or is the mindset of the CIO is starting to change or evolve in a new and interesting way? I think it's a maturing, for sure.

Um, I mean, listen, you know, all the priorities that have been there are still there, but we've added a lot of new priorities to the mix. And, you know, the reprioritization I think is happening, right? I mean, we, we see that in a lot of the data from the CIO study.

I mean, a couple things that really stood out to me, you know, cloud strategy still there, right? But it's a maturing, right? It's not so much about will I or won't I, everyone has, we all live in a hybrid world now.

The shift has really kind of gone to, I've got all these workloads and I've got all these places to run them. How do I get the right fit, right? So we're really optimizing for workloads around the right mix of security, performance, and cost.

Uh, cybersecurity still a very top, uh, you know, priority, uh, as is talent. Uh, but you see other things kind of gaining in priority, like, you know, the network, right? We all know the network is the great bottleneck, um, on ai, you know, interesting to see, you know, networks shoot up in the prioritization, you know, in the latest survey, uh, we continue to see, you know, a big lean in on platforms.

Obviously the, the platform wars have been going on for some time now. Um, what we really see in the CIO study is a simplification and a consolidation. You see vendors like Salesforce, ServiceNow, and Azure gaining AWS Cisco pulling back a little bit.

Uh, but I think the number one thing that comes through is, you know, AI is pervasive. It's everywhere. It is kind of driving every, everything, um, lot of adoption in sales and marketing and ops, really driving productivity, customer experience.

Um, and I thought, you know, a side of the maturity to me was, you know, interestingly, the data privacy concern now being a bigger concern than anything around bias and halluc hallucination, right? So I, uh, I, I think this is a very interesting, you know, the, the, the very definition of choppy waters, because here's the facts. I think CIOs, c, iOS, CISOs, C-level digital lead, digital transformation leadership are being asked to do more with less or the same, right?

And so what they're really doing is going through a huge reallocation exercise there. And, and this bleeds into the B block we're gonna talk about too. They're reallocating the mix of spend on humans to software, right?

They don't necessarily have more net dollars perhaps, but they gotta, they're, they're reallocating those dollars. They're reallocating those dollars to security and network and network security, identity security, because these are where the market demands. But make no mistake, we're in a huge period of uncertainty, though.

The market is at record levels, 50% or more of the market growth can be attributed to one company. One company accounts for 50% of our market growth of the stock market. You want to talk about irrational exuberance.

You, you know, and I think CIOs inherently feel this in their gut. They know they're making plans, but they're not built on, you know, we're making big bets on ag agentic ai. We're making big bets on AI all around at the same time.

We had that McKinsey report that says 80% of all ai, uh, uh, tests are, uh, not test projects are failing. And so it, it's choppy, choppy waters out there, right? And I, I, uh, Chris, I see you're, uh, you're rubbing your heads around.

He, he's ready to go. Go ahead, man. Take it from there.

Choppy waters. You're a sailor, Fort Pierce inlet, right? Sailing the tweens, my solar powered, you know, one or two knot boats south through, through Fort Pierce Inlet is a good example of this, right?

You know, depending on the tides, you get this amazing laminar flow. Just imagine, say two miles of water, several hundred feet wide and 30 feet deep, all moving without bumping a molecule. Everything's going that way.

And you hit that transition and that choppy water, that choppy right before, right? It's a fascinating thing for, for people who geek out on those sort of things. But I was just gonna bring up that, you know, McKinsey report, right?

We're exactly at this spot where, on the one hand, and you know, my thoughts of current AI offerings and what we're trying to, you know, how we're, it's, we're we're off by a thousand miles. And in the CIO level, the technical level, there's a lot of pushback. And the projects aren't working at the same time as today's topics, not just this, uh, segment.

The whole agenda today shows business people are moving beyond that and saying, alright, you know, the technical folks will figure this out. There's a lot of confusion. But if I'm planning one much less 3, 5, 7 years ahead, you know, I'm building this in, the budgets are there, and everybody's betting on the fact that it will work out.

And for fasting, I think they're right. And I think a lot of things, the way we're using a AI right now by and large is, is, is off by several degrees. And that's where, you know, that's why I get excited.

'cause that's where opportunity is. The money is right. The business is right.

This is going that way. You know, those of us down in the technical field, we're talking about the problems we're right too. But this will all get fixed out, uh, solved and worked out, and soon is happening.

Now, You know what, what's interesting is we're kind of only looking under the lamppost, right? Where the light's shining, and that's the IT budget. Uh, Don hcl, who leads this practice, CIO practice at, uh, future and research and talking with him about some of this data, one of the really interesting things was first time he's seen, uh, that the actual total IT spend outside of out, it was crossed over and was greater than the IT budget itself.

So the complexity of what IT leaders, whether it's CIO, ciso, CIO, whatever it might be, CTO, is they're navigating what they're needing to do for the organization. Both the equip IT and prepare it for ai, but they're also doing it in a sea where, you know, it's kind of all the waters are crossing at once. 'cause they don't control what's happening necessarily, what's happening out in the business units or in marketing or in finance, other people or HR that are, that are also spending their money on ai.

Not only that, but also SaaS systems, application technologies, that kind of thing. So it's, it's, it's never been more complex for a CIO to, uh, both be part politician and, and relationship builder to execution, make things happen and prove you can deliver value. I, I agree.

And, and I think one of the other issues is, at the end of the day, from a CIO CSO perspective, we've always have had issues. And, and I think this is where AI helps, is it's, you know, looking at all these logs and everything else, and it does bleed into, um, the next block. But we have had issues with bringing humans in to do something to, to look at millions of, of events.

And, and we need, we have needed something more AI to give more accurate, um, levels of, of alerts from, and I'm just talking from a cybersecurity point of view. We have needed this, um, to, to have more intelligence with the being able to review the logs and, and, you know, give events that when threat hunters are, are looking at these events, they're, if they're not coming up with a bunch of false, false positives. 0, right?

This augmentation for humans is really needed. The only thing that I get concerned about with AI and where we're going happens when I, when I, I just have to bring cloud in because I sometimes think cloud has been one of these, you know, let, like these cells of, you know, look at, let's put everything into cloud and, and it's gonna be free. And now all of a sudden, you know, companies are being charged so much.

That's the only thing I, I, I get worried with the, with ai, like, are we going so fast that it's gonna come back and bite us? Sort of like the cloud. And it, it's not that cloud hasn't been great and promising, it's just, it's been really expensive, right?

And that's why you see on-prem, and that's what I wonder with ai, since AI is not, we don't have a really good road in, in, you know, on how it's gonna be playing out. So are we putting a lot of our apples into this one basket and then it's gonna come back and bite us and be really expensive? Hey, if, if I can, right?

So this, think about this in this whole, this whole episode today, like block to block, it's all the, uh, different aspects of the same things, but, you know, quiet aware, over the weekend we put together a small business, uh, solution for manufacturing, and it was really more of a exercise of principles and so forth. Um, we are actually going to sell it. I think we can probably do quite well doing it, but as, yeah, on so many levels, um, it didn't take very long to put together whatsoever.

Um, it's up and running now. Um, we're weeks ahead of, of the conservative schedule we put together a week ago already. And it's to, to your point, uh, Kate, you know, the actual AI parts of it, they'll be as an ai, as a civic ai, you know, it'll be a teammate.

They're the first customer. We know who they are, they'll pick a name and it'll be on board and it'll do things in the system. It's not going to be clawed or Chad TBT.

It doesn't need to do a lot of stuff. It needs to understand the semantics of the business which aren't complicated, and be able to consume human readable things in certain ways and make sure everything's attest in to the point internally on a small server, you know, can use cloud access doesn't need it as long as power is up in the, in the facility, everything's running just fine. And be able to produce, you know, if human readable text, you know, for other, for the human teammates in the company.

And that's where it's going, right? So the big huge cloud AI absolutely has its place, but we don't really need, ultimately global. We don't need 10 massive data servers.

We will have tens of millions of small notes. And there's two things in the survey in the CIO thing that gimme cause for pause. First is, you know, I read it and I went, wow, return to sanity.

CIOs are evaluating workloads and fit for purpose, and we're gonna, you know, run 'em on the right platform. But then I remember CIOs tend to be autocratic. And so are they just gonna try to push everything onto a couple of platforms and make everybody conform?

Or are they gonna be, you know, a little more flexible maybe this time out? And can we find a happy middle? I don't think they can be autocratic.

What I was saying about the budget, people can spend their own money shadow. It is no longer, is no longer in the shadows, right? It's, it's all it.

So they have to craft strategies. And that's one of the things about platforms. Platforms are different than just a collection or a suite of products.

And it isn't just about integrating a vendor's own products into quote unquote a platform. Any platform not only has to support their products, but they have to have very strong integration capabilities because there are other tools, you know, the smart vendors recognize they don't get to own everything anymore, just like the smart CIOs recognize that. But they also have to offer some kind of a data fabric so that data can be shared across those tools, across those products, not just within itself, but also to others.

And when you to other products, and when you layer on ai, that's the grease to the skids. That's the ability for agents to actually do work across what we would think of as silos today. Whether they be work silos or data silos.

So platforms mean something different than just a, a nice brochure of five products instead of five individual brochures. But that's an argument. One, to allow CIOs to be more autocratic, you can't go out here freewheeling and free styling don't, it's gotta fit on.

So the company wide platform don't, no, I don't think it is In Mike's article, oh, sorry Alan, go ahead. Oh, no, I, I would, Kate, to your point about the cloud, look, I, you know, I was here, I think we all were here when the cloud first came on board. I think the whole myth of the cloud being a money saver was just that a myth.

Yeah. Right? The cloud is scalable.

It's burstable, it's maybe more efficient. It, it, it takes a lot of the nuts and bolts of running the infrastructure out off your plate, but it's not necessarily cheaper. There was always a point, I remember being out in Boulder talking to Rally software, Mitch, you remember Rally?

Mm-hmm. Ryan, they, they wrote the book on Agile and they already had a study, and this was in 2010. They had a study of at what level of usage do, are you better off going back private off cloud, right?

Because the cloud just becomes much more expensive. I, I think we are gonna see that at AI too. But I, I also wanna call out, Dion did great work in that CCIO survey, but there's another futurum survey out, um, on, on enterprise software market.

It grew to 340 some billion dollars, but forecast to go to about 600 billion then isn't in a year or two 600 billion. I I, well further Out. Yeah, further up, You know, and, and, and forgive me, is this a Keith Kirkpatrick?

Uh, Correct. Yeah, Keith, the Author. So let, let's give Keith a shout out on that.

Um, personally, I don't know. I, I think if it does grow that way, it, it's not net net new budget being added to the mix. It's, it's coming from somewhere else.

And again, that's what I want to kind of end my piece on this segment on, which is we, are we taking from Peter to, are we robbing Peter to pay Paul with, with allotted, you know, moving around dollars, but not necessarily put That's, that's what we do, Alan, right? Like, I mean, I think what, what we're generally seeing in the study is we're gonna let the innovation run and the innovation's no longer cloud the innovation is ai and we're gonna clean up kind of what's matured and played out, right? I mean, to your point, I think that the challenge with cloud was, you know, it was the answer to every question and you know, it's just not the case, right?

It's really good for some stuff. Uh, but it's, I, you know, not necessarily what you need for others. And, you know, I think we're gonna probably repeat a lot of the same pattern with ai.

You know, we're throwing AI in everything, but a AI may not be the answer to everything. And, you know, that will mature over time. We'll kinda see where there's clear ROI for it.

Um, and then, you know, we'll probably unline some of what we've done. Um, you know, it feels like history repeats itself and we're just in a new pattern, you know, in a new cycle. Sorry, same pattern, uh, new cycle.

So I'm gonna leave this segment with this 'cause I'm gonna claim last word. Satya Nadella says, we're no longer a software factory. We are intelligence engines.

That's, and that's the big thing. You're watching text and gang. We're gonna come back and talk about service as software.

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Yes, our, our guests have picked up on that. There is a continuing theme here. And the next thing we're gonna talk about is, well, what is happening with IT services?

Historically, I think there's been reports that it's estimated that for every two bucks spent on software, there's nine to $10 spent on services. And well, that's a little bit crazy when you do the math and you start thinking about it. And we have CIOs that are trying to figure out, well, how do I kinda rebalance this budget?

And a good place to look is maybe how much we're spending on services. Alan has a piece on digital CXL talking about this very issue. Um, Alan is, is there hope here?

Is this something we're gonna see happening? And what will be the impact on all those IT services firms that are counting on this revenue? So, first of all, I, I gotta give credit to where this came from, right?

I, I picked this up on LinkedIn. There was, uh, some articles from our friend Chris Hoff. And I, I, how many of you know Mitch?

I know you know Chris. I don't know how Kate, Chris, I mean, Chris Hoff has been one of the leading lights in security for 25 years from security blogging first got off, Chris Blask one of the leaders of his good friend of ours then, not that he's not a good friend now, but he doesn't blog anymore. He mostly does LinkedIn.

My, he runs security at, at, uh, LastPass. He used to run security at Bank of America and some other places. Brilliant, brilliant guy.

Him and a, a former of VP Corp Dev. Now he's a venture capitalist board member kind of guy. And I'm blanking on his name.

I apologize. It's in my article to Ari. Yep.

God. So originally Ari wrote an article that said much what you said, Mike, the, the soft white underbelly, the, the dirty, dark secret of all of these software and software as a service is that they're really services, right? And it was primarily talking about sock running socks.

You still need the sock. No matter how much software you buy for your sock, it's still the sock guy who's sitting there running it and doing it. And that what we're gonna see with AI is shifting to what he call service or software replacing the service element with software with agentic ai.

Hof took umbridge with this and said, you know, soc people are snowflakes and they're each individual and they can't be replaced with software. I don't necessarily agree with that. I do think a lot of what they do will eventually be replaced by software.

But it, it goes back to what we just spoke about. Are we just gonna reallocate what we spent on people on software? And I don't want to be a doubting Thomas and Mitchell, I know you're a big fan of agentic ai, but boys and girls, show me the money.

Show me the money agentic AI has not shown. And I'm sitting here telling you this, you want to throw stones at me, throw stones. But as we sit here today, a agentic AI has not shown that it's scalable, doable.

And let's start throwing people out the window because it's gonna take their place. Not happening. It does.

It's My Counter is for science experiments. Go ahead, Mitch. My counter is neither did the cloud at the beginning.

So yeah, I mean, we're, we're, we're overhyping it. And so of course we have unrealistic expectations about AI and agent. I think if, if, um, if you go back to theory of constraints, 'cause we all love from DevOps and software development.

When you take a constraint and you either remove it or you, you drastically reduce its impact, that's when systems change and when they start to change. But you have this evolution of per evolutionary period where you still do things like you used to do them. You just use the new technology to do it a little better, a little faster.

And we've been on this treadmill now of automation, right? Productivity improvements, how many more messages, how many more SOC issues, how many more, uh, you know, issues kind of run down in, in an IT organization, whatever it might be or, or claims I need to process. The thing about ai, what it removes a constraint is you don't have to have someone touch it all the time.

We'll get more and more to this place. We're not there yet, but we'll get there is, is it's able to deal with some things in real time that a human would have to deal with, but it can do it at a larger scale. And once we kind of tip over that part of the curve, that's, I think when we will see jobs change, we'll see things, uh, you know, it's redefinition of managing agents instead of managing messages, managing issues, things like that will change in, in the work.

But, you know, we're not there yet. It's not happening. And, and of course, you know, uh, ri is he, he is a venture capital investment guy.

He's talking about all the companies that have been invested in that are early startup stages. So that isn't real yet, right? Those are early companies, they'll come along.

But, uh, that's what he's gotta, he's gotta promote that what, what he's investing in. I mean, I would agree to Alan's point that AI companies are parsing the word is in a c clintonian fashion. And we're a long way from these AI agents actually doing any Of this stuff just yet.

Yeah. I, I, you know, you know, so, so Alan, you know, you know, again, I'm not gonna litigate the current state, you know, you know, from a financial investor, you're right. You know, it's, is a particularly dog's breakfast.

But Mitch, you're, you're exactly right as well. We're at one of these stages where we, you know, if in fact this is a serious, you know, transition and it is, then we should expect that what everybody's doing right now is intrinsically wrong. Right?

You know, it's right bits, but it's a, it's a, it's a mess. It's not efficient. They're not hitting goals.

And, but I think going back to the, the actual topic of this, you know, uh, services as software and that, uh, manufacturing, uh, case study, uh, referenced in the last segment, that's literally it. You know, we're replacing all the software in a small business with just the service and the software is delivered intrinsically and to the point ally parts of it, you know, the, the, there's enough cognitive capabilities in a tiny little LLLM, you know, properly done in a, in an environment like that, that you don't need to go out and buy the new stupid software and you shouldn't have to know about, you know, software product brand name version because you're a bloody manufacturing company. And we've been promising that for decades.

But, you know, we're literally doing this right now. And I think that, you know, it, as I say this, this isn't our, our core line, but it's a, it's a exercise. It should be profitable, it should, you know, do some good in the world.

But as I look at our, our list today, that's one of the things, you know, I would like the CEO of this tiny little company to stop being able to tell me the version numbers of the software he uses. It should just be a service. And the software itself will be delivered and designed by us in real time to fit the needs.

Chris, I'm not disagreeing with you on that, but when I wrote about service to software here, services code for humans, right? We're replacing humans with software. Uh, yes.

Yet, you know, I'm on the fence on that one. I have the same concerns as everyone else. But you know, when I, as a company, as wire wire, we will have humans running this.

You know, there are humans. We have jobs, you know, already speced of, and, and, and That's exactly this. How's point that you're going to need humans running it.

Look, this is why I think the CIOs are facing these complex challenges because in the pit of their stomach, they're making a bet on something that is as yet unproven. Totally. Dan, we're announced today, few terms, signal is, is, is live.

And, and we're, we made a, we made a bet. I'm, uh, that my article will be up. You, it's up.

You could read it, right? When you look at where I, I've been on a few signal calls now, and one of the things vendors, 'cause it's been mostly with vendors, not end users ask is, well, how are you gathering the data? Where's this data coming from?

And when you look at where the data from signal comes from, it's basically a, I call it a third, a third and a third, one third is we have this exclusive deal with G two who has millions of people who are voting with their fingers and giving valuable feedback. And we have the exclusive feed from that data that we're then grabbing. And, and again, using ai, putting that into the, to the mix of, of the signal, if you will, that helps calibrate the signal.

One third comes from the exclusive opinions research and analysis of the RUM analyst. Again, not necessarily ai, but it's the, the future of analysts. This is their opinions, this is their research.

One third. And then when I say a third, it's not exactly a third, a third and a third, but close enough. One third comes from a agent AI combing the public domain and grabbing all available information on that given topic, right?

And, and adding that on top of these two exclusive feats. So you got three pieces of the pie. Maybe they're not the same size, one third, aren't they?

But there's three pieces of the pie, Dan, we're betting that the agenda AI does a great job on that, Right? Yeah, it does. I mean, I think we've seen it already in, you know, the results that, that we've seen internally, you know, excited to reveal those to the rest of the world tomorrow.

Uh, I mean, just to jump back and ground us here, i i, the, the Phrase Jan, remember we taped this the day before. We've revealed it to the world. Go Ahead.

Software, you know, and credit to Phil first, who I believe coined the term, you know, he was really talking about in the context of IT services and IT consulting and taking these, you know, very repeatable patterns of behavior and codifying them in code, um, and kind of, you know, replacing the human labor with it. And, you know, I'm glad you used the signal example, Al. 'cause you know, we've done exactly that.

You know, Brad Shiman, who, you know, had a lot of input, um, as the lead analyst on our first signal, he has created research analysts and research directors, uh, agents who are playing those roles. I mean, historically, when other firms would go about this, there would be some junior analysts who would do all the data gathering and all the synthesizing. And you know, we are using AI to do that today.

You know, we have created AI agents who go out and comb through all of the vendors product documentation and their case studies and everything that's available publicly that would be available to a prospective buyer. And as you've said, we've obviously layered on, you know, some really proprietary intelligence that is not out there, you know, through both G two as well as few terms intelligence platform and everything we're collecting. But I think it's actually a perfect example of, uh, services to software.

You know, the, the role that a junior research analyst would've played in a lot of the data gathering is being done ag, uh, genetically. Um, and, you know, we still have that human in the loop, that market expert who can comb through this and really make sure that it's credible, that it all stacks up. And, you know, really where we've done is we've shifted, when we talk about this a lot with ai, right?

Moving the human to higher value work, not replacing them. You know, Brad is able to focus on all of the, you know, his opinion on the go forward prediction side of things versus spending days and weeks and months gathering and synthesizing information, right? So it's actually a perfect example of this in that there are probably a couple junior analyst roles that existed in different analyst firm as they go through this process that we have done away with.

We have started, you know, from a place where we don't need that at all. Um, and we have shifted the human in the loop to that higher value work, which is much more predictive context to where versus spending a lot of time summarizing the history. And By the way, that, but can you hear me out by the way?

That was exactly Hoff's point, that the SOC analyst part of what the best of the SOC analyst intuitively are able to look at that data screen and, and see something, or see a threat, see an attack, see something that, that the software may not necessarily pick up, but it's, it's, and, and that's the point where do we draw the line between what, what an AI could do versus truly what the human needs. Chris, I'm sorry, go ahead. No, no, please.

Uh, and it's, it, that was an interesting riff on this, uh, because I, I was gonna take this and I am gonna take this in a slightly different direction, and I'm glad Dan, you went down that path because in the IT space, you know, where we're all focusing and there's the big data centers and the big, yeah, there's gonna be shifting around will there be more or less jobs? Fantastic. You know, interesting conversation.

We don't know. Um, but Donna, my wife, you know, on our marriage certificate, uh, I'm listed as a forklift driver, and she's a word processor, which was a role, whole floor is a word, processes in the eighties. And they were humans.

They had lunch right now, now they're, they're an app. But I look at it, you using the, the, uh, case I was mentioning earlier for the, uh, services replacing software. Because in these small companies, they have no services.

They may be an IT person who comes in sometimes, you know, the owner's brother-in-law or whatnot, um, and that's it. But what they spend on IT is licensing on software. And in the case we're looking at and related and, and small medium manufacturing.

Um, we're not paying any, you know, we're, we're, there isn't any licensed software now, the CAD software, you know, I'm not ready as quiet wired to replace that just yet, but yeah, and that can all be generated in open source too. So millions and millions and millions of these, you know, tens of millions of small companies are spending all their IT spend on software licenses and, and, you know, subscriptions and whatnot. And a lot of that's gonna get replaced with software, with services as software.

The software delivered into the company, 7 24 will be the service. And they won't know what brand it is, but just their, just their partner, You know, this is all lovely, beautiful picture. Reality is the following.

We have spent an inordinate amount of money at first on IT services to compensate for the fact that the software's too damn hard to implement. And then the second thing is, we have so many other people who are doing manual labor and nonsense tasks all day because the software's too damn hard to use. So now you're telling me that the very people who made this problem in the first place are gonna show up with a bunch of agents to solve this.

Well, that kind of sounds like Bullwinkle this time, for sure. So I'm kind of dubious of the whole thing to be honest, and we'll see how it plays out. Well, you should be dubious, but, but again, you know, you've made a lot of specific assertions, right?

And maybe you're right. I don't think so. I think this time it actually is true.

So we'll see all, Okay, We'll always in the middle, right? And you, do you believe in Santa Claus in the Tooth Fairy? It's okay.

Thank you. We're gonna, I do. I do.

You do. Okay. Because I wanna believe, I wanna believe, I wanna believe, right?

We're gonna take a break. We ran a little over. Let's come back and talk about fusion confusion.

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And we're back and continuing our theme here on when Masta essentially re-engineering, but Microsoft is now out talking about, well, fusion, and it's as much as an idea as it is a piece of software. But the core idea is that somehow or other, all the end users and all the professional developers are gonna link arms and have a kumbaya moment, and we're all gonna develop software together happily ever after. You can tell by my tone that I might be a little bit dubious about this too.

Mitch, though, what's your take on what's gonna happen here and how all this is gonna play out? Well, first we need to check if somebody puts something in your Wheaties this morning. Kind of got, got you.

Agitated. So, so what this is about, Microsoft uses the, the word fusion, uh, and not as some new kind of food, you know, kind of combining this with that. But actually people working together, bringing together non-technical people with developers or citizen developers with professional developers, and they, they're, they're starting to change the use of that term to more full stack.

And what they mean by that is not the traditional full stack that we think of as the, the software developers build around, but the idea of coding was, so something was really difficult to get a non-technical person to be able to do. So you use some, you use some, um, you know, tools that help automate some of that for you. Now you can vibe code things.

And what it's changing is using ai, you can use AI to help prototype ideas. So now the expectation is becoming a product manager could use Cursor or, um, you know, visual Studio with whatever, you know, with that, uh, uh, whatever LLM in the background as actually a way of prototyping or demonstrating some ideas of what they're thinking about. It's no longer just a requirements document or a PRD that they have to put together.

Matter of fact, I heard, I don't know if this is true, I heard one one person say that that's part of their interview process is, if you're gonna interview here, is in a product role, you need to pick an app, pick a tool, and go vibe code it and show me, I'm not gonna look into deploy what you put together in production. I'm looking how you can express your ideas through leveraging AI tools, which goes back to my point about AI isn't gonna take your job. It's somebody that knows how to use AI better than you do.

They'll take your job. So that's this idea around kind of full stack moving from this, moving from Fusion, blurring the lines a little bit, but I think it's more about, uh, using tools to try to express things closer to the, the end product that we're trying to build. And I actually think it's, it's, it's needed.

Oh, sorry Chris. Um, I, you know, at the end of the day, you know, trying to get the, the dev people speaking with, you know, the ones who are trying to make the app and let's just add security cybersecurity in there. It, it's, it's been a mess, you know?

And it's been a mess for years. I mean, this is, I, I am, I hope, oh yes, I do believe in Santa Claus. I really hope that's gonna happen because we, it's, it's so needed.

It really is needed. So is the United Nations, that doesn't mean it's successful, right? Right.

Yeah. That, that's almost you. And like, Because, because here's what the Grinch is think, and the Grinch is thinking that this is, you know, low code, no code on steroids.

One more time. We called it vibe coding. We're gonna dress it up with a bunch of end users creating, um, software that is, once again, maybe not very scalable, certainly insecure and, and too hard to use, right?

Ugly. And we're gonna dump this on a bunch of professional developers and tell 'em to go fix it. And we don't have enough of those people.

So maybe we're gonna hope that AI agents will help them fix all the software and the end users are creating this. Doesn't sound good to me. Haha.

Bug, In 35 years, uh, working in technology, there has been almost no technology involved in my career whatsoever. You know, such a tiny, tiny amount of it. You know, what's been been important all along is the teams and the people and the ideas, right?

The technology just gets in the way. And this is what makes, you know, folks like you, Mike, cynical because you've seen it over and over again, but it's the same as, you know, this is a very short period of time. You know, because we've seen something before doesn't mean it's inevitable.

It means it's, it is a coherent pattern that can be expected to pop up again. And it may in fact be the only pattern. But, you know, let, let's be clear, you know, human history as we talk about it, is 200 generations.

You know, this whole topic we're talking about is three. And most of us, you know, on this, on this show, at least, you know, me and anybody older has been alive for at least two of them, right? So we've only gone through a couple cycles so far, and we keep repeating the same mistakes.

But I and Mitch, you know, you say I'm, I'm usually in the middle. This one, to be clear, I'm not in the middle. I have picked a side.

I'm so enthusiastic about it. I spend all of my time around folks like Mike trying to prove me wrong. And I don't think I am.

I think we will actually close the loop, effectively speaking this time around, so that we actually have teams of people making solutions instead of, you know, competing teams of people who hate each other on the same side, trying to get budget so that they can not get fired. Well, convincing Mike is, is more like, uh, tilting at windmills. I think it was the old phrase, but you, you keep trying.

Oh, you keep going. You don't try to convince Mike or Fred Cohen. You just try to, you know, rebut enough of their arguments that you might not be wrong.

That's all I'm looking for. We wouldn't have to prove anything, Mike, I'll be your poncho to Don Otte anytime with the windmills. It warms my heart that my grandchildren are gonna enjoy the fruits of your efforts.

'cause it's, that's how generation, Well, honestly, I, we, we talk about that a lot. But seriously, look, look, we're thought leaders in this big global thing. I have plenty of plans.

I know I'm not gonna live to sea, but we gotta be able to plan past the horizon. Planted tree won't live to see, particularly at our age. Well, thank you for that optimistic look, Chris, um, you call him the grim reaper anyway, well, To be happy now, that's amazing, right?

But, But you let me do, bring up one thing about ai. It, it comes out here and it, and it shows itself in our other, uh, uh, blocks today too. The thing about AI is, it, it, it, as an umpire, it calls them as it sees them, right?

It can't be, theoretically it can't be bought, bribed, paid for it. It, you know what you give it two candidates who wrote code, it's, it's gonna pick out the one who wrote the best code, right? Regardless of whether that candidate sexual preference, sex, race, whatever's, um, with, with, in the instant case of Signal Dan, that we spoke about.

I don't care how nice you are to the analyst, the research is what the research shows, right? You sucking up to an analyst or flying them out for a nice lunch or dinner isn't gonna help it. Um, in terms of being a developer, what it develops is what it develops.

No matter whether it's a, whether you're, you know, some developers take a lot of time off, some developers are great teammates, some aren't, some are solos. It it, it is an impartial, uh, just even, right? There's no, there's no plays on that.

Yeah, exactly. And I'm Not sure I'm buying that either. 'cause I can tweak that LLM on any prompt that I want to have it come back with whatever I need it to say.

I'm getting you a tinfoil for the next show. I To tell you that is, that is detectable as hell. Go ahead.

You know, we, we watch these, you know, certain billionaires try to get their LLMs to, you know, say the sky is green and the LLM acts weird. And I'm here to tell you, that's a tactical thing. You know, you can't make an LLM lie, but it'll look like a liar.

It'll sound like a liar to other LLMs and people. Have you seen Washington lately? Because, you know, and everything Oh yeah.

Looks, so what's the news? So when AI agents there, Well, let, let's Cynical about this. I know we've did, you know, this sounds like a lot of what we've heard before, um, and it's just a new effort on it.

But I think, I think it, it is a lot like we've heard before because ultimately you're trying to bring together two people, two groups of people who really meet each other. You've got a group of people who are trying to build solutions to help with people who really deeply understand those problems. And, you know, I think this is obviously just another attempt to try to eliminate that friction so that the people who understand the problems can help the solution builders build a solution that really, really works for the user Benefits from someone's lips to God's ears.

That's what I, Kate, Kate, what do you say? Well, and, and, and needs to be secure at the same time, right, Dan? Of course.

Yeah, of course. That's, Sorry. I see benefits down this path if you start Winning.

So Michael will Be a little more, yeah, that's what it'll take. But no guys, seriously, Kate, to your point, when we start including security people as the builders, right, we'll start having more security in what we built. And, and that's something that needs to be addressed too.

But that'll be for another show. Gang, what a great gang we had today. I appreciate y'all, I appreciate the comments, the opinions, the thoughts.

Mike, thank you as always for putting together our, our, uh, blocks for today. We will be back tomorrow with yet another gang, as usual, who knows what we'll talk about. Then you'll have to stay tuned by the way, you can catch the gang.

If you just want to catch individual blocks, they're available on our Tech Drunk tv, YouTube channel. You could also watch on Tech Drunk tv OTT if you are onto Apple TV or Roku or, or Amazon Fire or iOS or, or Google Plates all available there. And of course, on Text Drunk TV itself, or you might be watching this on our Text Drunk TV Network when we stream it every day at nine 30 on LinkedIn, Facebook, and Twitter, and all of our text drunk sites.

So lots of places to catch this as well as text Drunk tv following it. Um, we did release Signal today, so go check out all the news around FU Signal. Interesting stuff there.

Some good AI stuff. Chris is doing stuff with quiet ai. We've got all kinds of stuff going on, but we'll be back tomorrow.

Until then, this Alan Shimel, on behalf of the gang, have a great day, everyone. We're out.