Why AI Clones Could Destroy Adobe, Microsoft, and the Software Rental Model — Transcript

Full transcript

1. 0:00So don't look now. There's people out
2. 0:01there cloning software and releasing it
3. 0:03for free using AI. Let's talk about it.
4. 0:09So welcome to Dave Lintum is not AAI.
5. 0:11I'm Dave, an AIM theme and an AI skeptic
6. 0:13looking at AI with a balanced
7. 0:14perspective. Let's get started. So
8. 0:16something happened this week I figured
9. 0:18we'd talk about here. So I'm kind of
10. 0:19rushing this thing out, not putting it
11. 0:21in the 30-day queue that I typically use
12. 0:24when I publish these videos. So, and
13. 0:27[gasps] this is something I think should
14. 0:29worry uh every software giant out there,
15. 0:31certainly the enterprise software giants
16. 0:33that are making, you know, billions and
17. 0:35billions of dollars from the software
18. 0:36market. So, a single developer used AI
19. 0:39to reverse engineer Adobe's entire
20. 0:41creative cloud and released it for free
21. 0:43as open- source. And so let's take a
22. 0:46look at what this means for Adobe,
23. 0:48Microsoft, and anyone who pays for
24. 0:50software and where this seems to be
25. 0:52heading right now and why this could be
26. 0:54a disruptive force that we all need to
27. 0:55pay attention to. So Adobe's moat was
28. 0:58always that recreating Photoshop meant
29. 1:01uh you know a team of engineers um you
30. 1:03know reading its compiled binary,
31. 1:05disassembling its functionality and
32. 1:07writing a compatible replacement which
33. 1:08is going to take years. But however, AI
34. 1:11is able to collapse that by watching the
35. 1:13app's behavior and regenerating
36. 1:15equivalent Rust code that gets
37. 1:17recompiled and shipped as open source.
38. 1:20So this is something we knew was
39. 1:22possible for a long period of time and
40. 1:23actually people have tried it for a long
41. 1:25period of time just various degrees of
42. 1:27success and obviously there's been
43. 1:28decompilers around since the you know I
44. 1:30got into software and they were
45. 1:32interesting but you know the ability to
46. 1:34kind of take a commercial piece of
47. 1:36software decompile it and rebuild it
48. 1:38into something a bit different and
49. 1:40releasing it as a free piece of software
50. 1:42uh was probably a bridge too far for the
51. 1:44technology. Now, not so much because the
52. 1:47AI uh systems out there, the big LLMs
53. 1:50that are fairly tuned, we knew they were
54. 1:52able to do this for a long period of
55. 1:53time, can look and examine the behavior
56. 1:55of an application and replicate it in
57. 1:58another completely net new codebase,
58. 2:00maybe something that's mildly changed,
59. 2:02and we're able to take that codebase,
60. 2:04recompile it, and do whatever we want
61. 2:06with it. Now whether that's going to
62. 2:08pass legalities or not and uh you know
63. 2:10court test things like that I think it
64. 2:12remains to be seen but that capability
65. 2:14has been there for a while now people
66. 2:16are using it to basically clone some of
67. 2:20the bigger software providers uh
68. 2:21Microsoft Adobe are the are the two that
69. 2:24come to mind and we have to consider
70. 2:26what are the opportunities here and what
71. 2:28things do we need to look out for so
72. 2:30this isn't hypothetical Brandon Thomas a
73. 2:3315-year industry veteran has already
74. 2:35used claude to released seven
75. 2:37open-source Rust apps that imitate quote
76. 2:41unquote Adobe Suite as a uh direct
77. 2:45reaction to its cancellation fee. So
78. 2:47what happened was he like everybody else
79. 2:49and I ran into this as well when I wrote
80. 2:50my last book. I was uh editing the book
81. 2:53with Adobe and I had of course resigned
82. 2:55up for the Adobe tools and it cost me
83. 2:57money to cancel when you know the end of
84. 2:59writing the book and that kind of leaves
85. 3:01a bad taste in your mouth and using this
86. 3:03tool which I didn't think was that
87. 3:05valuable and certainly not worth the
88. 3:06money but I needed to use it to edit the
89. 3:08book and this gentleman actually reacted
90. 3:10to that. So in other words, he paid a 99
91. 3:12cancellation dollar cancellation fee and
92. 3:14decided to is there a better way maybe
93. 3:16maybe I can clone this with AI with
94. 3:18actually not a lot of development skills
95. 3:21and release it on my own terms and even
96. 3:23release it with the functionality that I
97. 3:25think is more important and that's a
98. 3:28gamecher. So reviewers call these apps
99. 3:30still in early alpha with rough edges
100. 3:32and you can certainly go out there and
101. 3:34download them now and take a look at
102. 3:35them. I believe they're out on GitHub.
103. 3:37Uh but the direction is unmistakable.
104. 3:39you know, fidelity now improves every
105. 3:42few months as we get better and better
106. 3:44at cloning these systems, not every few
107. 3:46years like it was in the past. So,
108. 3:48they're not bad. And so, if you're
109. 3:50looking for the functionality of Adobe
110. 3:52and Microsoft and some of the other big
111. 3:54cloud providers, they're able to provide
112. 3:55it. Now, I whether it is changing the
113. 3:58functionality and changing the brand and
114. 3:59look and feel, whatever min, you know,
115. 4:02minor changes, so they're getting around
116. 4:03some of the some of the IP protection
117. 4:05stuff, that remains to be seen. But the
118. 4:08reality is that you're able to get the
119. 4:09core functionality, uh, the reason you
120. 4:11want to buy these apps in the first
121. 4:13place, replicate it in an open software
122. 4:15piece where it's almost just as good as
123. 4:19the one you're going to pay for. And so
124. 4:21what I always like to say, you know,
125. 4:22good enough for what it's for. And in
126. 4:24many cases, you know, people who are
127. 4:25small businesses, independent
128. 4:27consultants, things like that that don't
129. 4:29want to make the investment and the
130. 4:30yearly rental cost in this software,
131. 4:32this is an alternative. So this is a
132. 4:35reaction to what I think the enterprise
133. 4:37software companies are doing and kind of
134. 4:39abusing their customers. So we're
135. 4:41they're already bristling at rising
136. 4:43subscription costs. This includes
137. 4:44Microsoft's own 30% hike which is tied
138. 4:47to co-pilot integration that nobody
139. 4:49seems to be using. No one asked for it
140. 4:51yet it's there and you got to pay for
141. 4:53it. And a free good enough alternative
142. 4:55is going to reshape what they'll
143. 4:58tolerate paying for in the marketplace.
144. 5:00In other words, this is an alternative
145. 5:02that is going to be a reaction to the
146. 5:04fact that people are pushing back on
147. 5:06some of these big software plays.
148. 5:07Microsoft is the most egregious. And you
149. 5:09know, as we're updating Word, you know,
150. 5:11and Excel for the, you know, 100 time
151. 5:13and getting the downloads now in
152. 5:15Microsoft 365, I'm not finding any
153. 5:18additional functionality that's of value
154. 5:20to me based on the version of Word Ian
155. 5:2210 years ago. And I think you guys are
156. 5:23finding the same thing or Excel, things
157. 5:24like that. So they're shoving
158. 5:25functionality, you know, into the pipe
159. 5:27and say, "Well, this is more valuable
160. 5:29and therefore we're going to charge you
161. 5:30more money." And these things are
162. 5:32basically, you know, hybrid cloud
163. 5:34services at this time. You have to have
164. 5:35the back-end systems that are operating
165. 5:37in order for to use the software. And
166. 5:39people are just throwing up their arms
167. 5:40saying enough. We can find equivalent
168. 5:42open- source versions. And we're going
169. 5:44to look for some of these clones out
170. 5:46there as alternatives for the software
171. 5:49that we have to rent. And you you
172. 5:52brought it to yourselves, guys. big
173. 5:54software. So Adobe and Microsoft are
174. 5:56both betting that integration data and
175. 5:58AI layers not code become the new moat.
176. 6:01In other words, keeping people out as
177. 6:03Adobe pushes generative features across
178. 6:06its clouds and Microsoft builds out
179. 6:07copilot and uh Asian 365. So what what
180. 6:12they're saying is that the quality of
181. 6:14the integration, the backend storage
182. 6:15capabilities are what people are going
183. 6:17to stay for you and not necessarily the
184. 6:20core functionality of the software
185. 6:21itself. And if even if you do put out a
186. 6:23clone, they're going to miss that pretty
187. 6:25quickly. I don't think so. [laughter] I
188. 6:27can I can store stuff on my own, you
189. 6:29know, cloud provider, Dropbox or, you
190. 6:31know, free tier or Google, you know,
191. 6:34Google Drive, what have you, and it
192. 6:35works fine. And I don't need to have
193. 6:38these integrated systems for the way I
194. 6:41use software. Now, enterprises, and this
195. 6:44is going to be uh, you know, just kind
196. 6:46of the way it's going to be, is that
197. 6:47they're happy to pay for the software if
198. 6:49they're getting the functionality and
199. 6:50getting the support. And obviously,
200. 6:51you're not going to get that with some
201. 6:53of the open source stuff that's out
202. 6:54there. And so in many cases, I don't
203. 6:56think this is going to change much the
204. 6:58way and and how enterprises consume this
205. 7:00stuff. Large global 2000 companies, but
206. 7:03the rank and file users, the small
207. 7:05business owners, the independents, those
208. 7:06sorts of stuff are kind of getting
209. 7:08[clears throat] sick and tired for
210. 7:09overpaying for this stuff and not
211. 7:11getting a lot of value back. I think are
212. 7:13going to look at these clone
213. 7:14alternatives.
214. 7:16So this is definitely going to pick a
215. 7:18fight. So the legal fight will define
216. 7:20the next 5 years because reverse
217. 7:22engineering for interoperability can be
218. 7:24fair use. Uh yet uh EUAs and DMCAs and
219. 7:29existing uh precedents uh all predict AI
220. 7:32assisted cloning. So coming lawsuits
221. 7:35will set the new law. So in other words,
222. 7:37they know that people were going to
223. 7:39clone this stuff or the technology was
224. 7:41going to be more viable than it ever was
225. 7:43like it is today in the end of 2026. And
226. 7:46so it's going to be a fight in court as
227. 7:48to whether or not this is fair use or
228. 7:49not. Uh I think that the problem is that
229. 7:53since this is kind of an international
230. 7:55thing, it's going to be different laws
231. 7:56and regulations depending on what
232. 7:58country you're in. And so many countries
233. 8:00are going to say it's fair use. You're
234. 8:02able to clone the stuff. Uh then if you
235. 8:04want to use that, it's obviously a
236. 8:05different piece of software may be
237. 8:07branded differently. So you know, you
238. 8:09know, no harm, no foul. Uh however, many
239. 8:12countries are going to protect some of
240. 8:13the bigger, you know, enterprise
241. 8:15software providers and say that's going
242. 8:17to be illegal. And so we'll see the way
243. 8:19courts come down on this. I suspect it's
244. 8:21going to be a huge fight. I'll monitor
245. 8:23it. We'll talk about it here as it
246. 8:24progresses. So I don't think that the
247. 8:27industry will die, but the value will
248. 8:28shift from who can write the app to who
249. 8:30owns the data, trust, support, and
250. 8:33workflow. The the things a lone coder
251. 8:36can't clone in a weekend. And I think
252. 8:38that's where this thing is going to come
253. 8:39down. I think that it's perfectly
254. 8:41acceptable or it's going to be perfectly
255. 8:43acceptable for people to use clone
256. 8:44software. It's been it's not anything
257. 8:47new. There's been clones of Office and
258. 8:49clones of other thing out there. Not a
259. 8:50direct clone in terms of it looks
260. 8:52exactly the same, but obviously, you
261. 8:54know, replicating many of the same
262. 8:55functionality. And so these things are
263. 8:57going to be a little bit more tightly
264. 8:59coupled to the functionality and
265. 9:02behavior of somebody [snorts] else's IP.
266. 9:04It depends on what the court says, but
267. 9:06that's going to be, I think, a
268. 9:08legitimate alternative out there moving
269. 9:10forward. And these are things you can
270. 9:11actually do yourself. You don't need to
271. 9:12be a coder to uh basically, you know,
272. 9:15create these things, which is going to
273. 9:17be good enough what you need it for. And
274. 9:18there's all kinds of possibilities here.
275. 9:20Number one, we're able to take a piece
276. 9:22of software which is typically going to
277. 9:23be huge amount of bloatware uh that we
278. 9:26have to, you know, run on these big bad
279. 9:29expensive machines out there, you know,
280. 9:31huge amounts of memory and huge amounts
281. 9:32of storage where we can optimize them
282. 9:35for smaller, more nimble, lean, cheaper
283. 9:38machines because we're leaving out some
284. 9:39of the functionality that we don't need.
285. 9:41And that seems to be genius to me. In
286. 9:43other words, when I buy software, I'm
287. 9:45getting all of these things that the
288. 9:46software is capable of doing that I'm
289. 9:48never going to use. Obviously, Word for
290. 9:50Windows is a prime example of that. And
291. 9:53if I'm able to narrow that down to a few
292. 9:56base functions that I'm going to use,
293. 9:58basically optimize the software and able
294. 10:00to run it on cheaper equipment, and I'm
295. 10:02able to do that enterprisewide, that's
296. 10:04going to be many millions of dollars
297. 10:05saved. So, there's lots of opportunities
298. 10:07there to look at the value of this, you
299. 10:10know, as we move forward, and I think
300. 10:11people need to consider it. Well,
301. 10:13anyway, let me know what you think in
302. 10:14the comments, whether you think this is
303. 10:15a big issue or not, if AI cloning should
304. 10:18be illegal or, you know, this is a
305. 10:21natural reaction uh to the fact that
306. 10:23we're getting abused by the uh big
307. 10:25enterprise software companies. Anyway,
308. 10:27don't forget to like and subscribe.
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