Perplexity wants Chrome
Perplexity made a $34.5 billion offer for Chrome, significantly more than its own $18 billion valuation. Several investors including large venture capital funds have agreed to back the transaction. The company also previously offered to buy TikTok, suggesting a pattern of seeking distribution for their AI capabilities.
The hosts described Perplexity as an engine looking for a car. They have superior AI answer engine technology but lack the chassis to deploy it at scale. Rumors suggest Apple may acquire Perplexity to address its own AI shortcomings, and this offer may be positioning for a higher acquisition price.
Code generation shifts
Microsoft’s CTO stated that AI will generate 95% of code within five years. However, he clarified this does not mean AI replaces software engineers. Authorship remains human. Developers will shift from input masters of programming languages to prompt masters who orchestrate AI systems. Engineers will articulate needs through prompts and allow AI to handle repetitive work.
Boston Consulting Group reported that systems integration and custom software development account for 45.7% of total global SI revenue. If AI handles most code generation, the fundamental business model faces disruption.
AI is not the death of code revenue or code generation. It is a shift. We have to adapt and shift just like we did when CMS platforms became DXPs and e-commerce platforms moved to SaaS models.
Tim Elenius, American Eagle
Practitioner skepticism
A Master B2B poll found 63% believe AI code generation will not replace the majority of SI development services in three to five years. Only 37% said it will. The hosts noted that despite what companies say about plug-and-play capabilities, they consistently want to customize everything once they get their hands on systems.
Tim Elenius on transformation
Tim Elenius, VP of Strategic Initiatives at American Eagle, joined to share his perspective. American Eagle is a full-service agency that started with hosting and website development in the mid-1990s and has grown into digital marketing, managed cloud services, and AI projects.
Tim acknowledged that code creation is becoming faster but emphasized that contextual problem solving and systems thinking are not going away. AI is becoming the main tool in the developer toolbox, but validation remains critical. If companies let AI proceed without validation, they could spend more money than if humans had written optimized code.
Writing code is not the service. Delivering outcomes is. While Gen AI is changing the tools, there is still that need for strategic implementation and human thought behind it.
Tim Elenius, American Eagle
Data quality matters more
AI has accentuated the need for clean data. You cannot hide bad data with AI the way you could manually correct it in the past. Data preparation is critical for AI projects, especially document retrieval and FAQ systems. When data is not clean, AI models produce inaccurate results, and once bad data enters a system, removing it is difficult.
American Eagle talks extensively with clients about data cleanliness. AI tools can help accelerate data cleaning for companies without large teams, but testing and maintenance are essential to ensure ongoing data quality.
New service lines emerge
American Eagle developed accelerators using AI for content migration during replatforming. AI consulting has become a significant practice as boards demand AI projects without knowing where to start. Proof of concept and pilot projects allow companies to test solutions before full commitment.
The hosts noted that McKinsey reported 40% of their work is now AI-related and they have reduced staff by 10-15%. AI is changing businesses to greater or lesser extent across the industry.