The Customer Is the Builder: How AI Coding Agents Are Rewriting the Economics of Software

Ripon Chandra Malo, Zimeng Yu, Tong Qiu · 2026 · arXiv

DOI: 10.48550/arXiv.2610.30307 · open-access PDF

Abstract

AI coding agents could change whether organizations buy software or build the functionality they need. We focus on organizations and professional buyers whose domain knowledge can help them specify and evaluate tools for their work. We define the software substitution frontier as the functions customers could build and maintain at an acceptable standard for less than buying them. Using public data, we compare growing capacity to build with indicators of market change. Since 2023, the length of benchmark tasks that leading agents can complete at 50 percent success, measured in human working tim

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