Support for this episode comes from AWS. AWS Generative AI gives you the tools to power your business forward with the security and speed of the world's most experienced cloud. Specifically, we're talking about the software you use at work. The stuff you like or maybe just tolerate and use every day, the stuff you probably hate and try to avoid using at all costs, and the stuff you love and hate because your job revolves around using it all day long.
It's fair to say that businesses of all kinds changed radically when software entered the office. That's the foundation of the famous Mark Andreessen quote, software is eating the world. And now it seems like it's all about to change again, as AI automates more and more of that software. At least, that's if you believe all the CEOs who have come under code in the last year telling me that's what's about to happen.
These tools are all usually lumped together in a big bucket we call enterprise software, but there are often meaningful overlaps with the popular productivity tools many of us use in our regular lives as well. So first, I want to David's help in just defining it all. Then I wanted to talk about how it's designed and how that design shapes how we work every day and subtle and powerful ways.
That's everything from the big familiar bundles like Microsoft Office 365 and Google Workplace all the way down to familiar single tools like Slack. But as you'll hear David explain, we're starting to see scores of new apps crop up to handle very specific use cases built around clever metaphors and interesting new interfaces. But try and rewire our brains to make us work differently, hopefully faster more efficiently and lately more remotely.
Sometimes that works and sometimes it really, really does not. Something is changing about software at work and I often find the best way to understand the future is to take a moment and consider the present. Okay, David Pierce, software at work. Here we go.
David Pierce, welcome to Decoder. Thank you. It's an honor. This is your first time on Decoder. Ironically, I hosted the show before I was a guest on the show. I did a thing with Sean Hollister a while ago when you were off, you know, galavanting somewhere. But now I get to be here talking to you. What's interesting is you and I host another show together, but usually when we do other episodes of that show, I'm the guest and you're the host. And now the tables have finally turned.
I know, I don't know how I feel about it. Only the penalty is that you have to talk about enterprise software. I've brought this on myself. That's very much the difference between Decoder and the Verge cast is on this show. We're going to talk about enterprise software at great length. So you in addition to hosting the Verge cast with me and being at a large of the verge, you also write installer, which is our newsletter where you try all kinds of software.
I believe you do this as a form of therapy because you are addicted to software, which I'm worried about you as your friend. I'm worried that this is a problem that you have. But it means you have tried a lot of software in your life.
I have. I think I've come to see this as less of a procrastination technique of taking all of the tasks that I have in one place and putting them in another place rather than completing any of them because it still feels productive, even though I don't have to do anything. As constantly rethinking the way that I do everything, which again, you could argue that's not productive at all. It's probably not. But I have spent probably more time thinking about how I do stuff than almost anyone I know.
I don't know if it's useful. I don't know if it helps. I end up just back in the same apps. 400 different times a year. But it is the thing I have spent way too much time and energy on over the years. The way that I always think about enterprise software and software at work is the Mark Andreessen quote, software is eating the world.
There's a lot of ways to interpret that quote. But what I specifically think about is that all of the things you do at work will go from being paper and pencil or sculpting clay models to using software in your laptop. Fundamentally, all of people's work will be done in software. And then we've had so many CEOs on this show on the show and say the second we start making investment software.
Now we've made a forever investment software. We're just going to keep spending money on developing software on software engineers and maintaining the software. We're figuring out our cloud storage bills. We're now we're just doing software all day long. Is that generally right? Is that how you see the growth of enterprise software that we used to have floors of accountants and now we've got floors of people using Excel?
Yeah, and I actually think that is the right way to think about it. That it's not that we replaced floors of accountants with nothing or with one magical computer that does all of our accounting for us. We just changed the tools that we use and in so many ways the idea of our productivity being replaced by machines turns out to not be true nearly as much as it is the tools of our productivity are replaced by machines.
And I think that's what we've seen with software where we all went from adding machines and paper to doing the same arguably more work with computers and the same thing is going to happen with AI right like it wasn't that long ago that everybody was like,
oh, because of the industrial revolution and then computers, we won't have to work 40 hours a week anymore. We're all going to be so efficient with this new technology that we're just going to work eight hours a week and get the same amount done. Whoops, that didn't happen. But I think that that transition is exactly right. And I think the thing that comes after accountants using Excel is the question.
And I'm going to hold you to that because later on we're definitely going to talk about whether AI will constantly ask, but first let's start at a high level. I want to try to define some categories of enterprise and productivity software with you. There's enterprise software, which is software that sold big businesses and that can be a lot of different things. Google workspace, Microsoft Office, that's classic enterprise software.
Everybody needs a word processor at their computer at their desk. You can just pay per seat. Here's this productivity software. Email clients, whatever that is, whatever that set of things is one kind of enterprise software. Then there's, I don't know, whatever runs your industrial robots.
There's that. Then there's productivity software which consumers use. People plan their weddings and notion and Trello. You try all this stuff. You play with all this stuff. You cover this industry pretty extensively. Can you draw a definition for us here? How do you think about the different lines? I think your categorization is almost right. I think I would shift the Microsoft Office and Google workspace more into the productivity tool thing.
The way I've come to see it basically is there's software you use every day. There's the software you hope you never have to use. Then there's the software you definitely never have to use. The software you definitely never have to use is the stuff that runs the robots. There's a person at your company whose job it is to use that software and no one else will ever touch it.
There's a ton of that software out there. That's everything from compliance software, which is vastly big and powerful and important. Most people should never once in their lives have to encounter compliance software. That's one side of it. All the way at the other side you have the productivity tools. That's the Google Docs and Gmail, Microsoft Word and Excel and the stuff that people do their jobs inside of.
Then in the middle there's all the messy stuff that everybody hates the most, like the HR software and the travel booking software and the way to set up IT tickets and all of the things that make a company work but aren't technically how you do your job in most cases is that kind of messy middle.
People hate the software the most, I think, in the middle. It's not the stuff you use every day so you don't build systems around it. You don't learn the ins and outs of it. You just encounter performance management software four times a year.
You are required to do it, but you don't have to do it long enough to actually care about it. Those are the three different buckets of it that I've come to see over time. Obviously, all of them are gigantic businesses. All of them cater to completely different people. All of them are at varying levels of invisible to how most people actually want to do their jobs all the time.
Yeah, I feel like a fair warning for the audience here is the David love software and my goal in life is to never use software work. If I could get to the point in my career where people bring me printouts of things and I circle them with Sharpie and send them away. It's the dream. Truly the dream that I work towards every day. I'm farther from that dream with every passing minute. Yeah, it feels like every day we get further from the light of printed things on paper.
It's not going to happen for me, but it's what I think about because I am the person you're describing who encounters the software and thinks, why is this making me work this way? Why am I learning some metaphor that the expense software wants me to learn just to say I bought dinner for my team. I don't care about any of this. I just need you to pay me back for the dinner I bought for the team.
It feels like those metaphors are really what is getting sold over and over again. Both in the productivity software zone and then in the your company needs to function zone. And it feels to me very much like you sell the metaphor because that is the promise that's the exciting thing. Hey, if everybody just worked this way, you'd be so much more productive.
And then the reality is you look at the expense app and you're like, well, actually, I just want to throw my phone in the ocean. Yes. Well, and I think the if everybody worked this way, it would be great is the great truism and mistake of the software industry because it's just impossible. And the idea that you're going to get an entire large group of people to all understand a single system and process and tool for getting things done is borderline impossible.
And so if you're a software company, you basically have one of two options. You can either build a piece of software that is so unbelievably specific and opinionated that you literally can't use it any other way than that. Seriously, and this is like a non crazy way to build software that there is literally only one way to use it. It's not that there's even right or wrong ways. There's literally only one way to use it.
And you can actually get a pretty long way doing that because people will hate it, but they will use it correctly because it's the only way to use it or what you end up trying to do. And this is over time, the much more enticing and popular path, but also like the path to ruin is you try to be everything to everyone all the time. And you say, OK, your boss wants to use this piece of software and they want to use it this way. That's insane, but your boss is the one who pays for this.
And so you have to do it because your boss said so. But what we're going to give you is is a million other buttons and knobs to press and twist so that maybe you'll find the thing that you like.
And I hope as you can build this sort of great denominator software across everything. And that's how you build Microsoft word and and it eventually gets away from you, right. You build the thing that does everything to everybody and then all of a sudden it becomes this like overwhelming mess of a piece of software. And it all falls apart.
But those are only two moves. And so like I've really I've come to feel for these companies over times because you have IT managers who buy a lot of the software who want one thing you have bosses who demand a lot of the software who want something completely different. And then you have the people who actually have to use this software all day every day who are having this a foisted upon them and be dictated to them how they have to use it.
I don't know that it's even possible to build something that makes all three of those groups happy I certainly have not seen one that seems like it works for everybody. Let's let's talk about this in the context of some pieces of software. So it doesn't matter if you run a newsroom like we run a vergy run a small legal practice or you run a Fortune 500 corporation.
You've got some set of needs right you people need to talk to each other whether or some email or slacks you probably need to make something hopefully your business. Unless you're just making fraud in which case call me I love to do an episode of the code with you. But you know you got to take something in you got to put something out right that most businesses operate on this principle.
So you need some software helps you make the thing that you're making whether that is the software that's running your 3d printer or for us it's the software that makes the website. If you work at a legal practice it might be Microsoft word some software where you're productive where you're making something and then there's just the. I'm operating my business piece of it right which is usually Microsoft Excel right like you've got your I'm doing my financial modeling I've.
Where I'm tracking my employees I'm running my payroll all that is another sort of software there's a few ways to think about just buying that stuff right. You can buy a big bundle from some enterprise provider or not we have a lot of CEOs come and show and the CEO of MailChimp was like what I do is I sell you the software to email your customers.
And then I sell you the entire back office solution that runs your website and you're building and everything else as well that's a CEO square space that's what CO of Wix said that to us. They want to set up the website for the yoga studio and then run the entire yoga studio as business so the yoga people can teach the yoga that's one big bundle of software you can buy or you can piece together.
All the best in class competitors are the ones that work best for you from all the independent providers and hope they work together which approaches winning right now you think.
It's it's a strange overlap right now actually there was a long period of time where the bundlers were winning and you would start like you said with one need and you would say okay if you're MailChimp we're going to make it really easy for you to email a lot of people and then you see the thing that people leave MailChimp for during their day and you're like well we could just build that thing we can build better CRM software so that you don't have to go elsewhere to make the stuff in order to send it to your emails and then you just sort of slowly build out from there.
And that's the first starting to win because fundamentally all these companies would like to pay less money for their software and manage fewer things and have fewer contracts to deal with and the bundling becomes very useful. What is also generally true is that it's very hard to do a lot of things really well simultaneously.
And so I mean it's the the trueism of technology is right it's bundling and unbundling and I think we we were in a really intense bundling phase for a really long time and then the pandemic happened. And we unbundled so fast because all of a sudden everybody was at home everybody had new software needs and everybody needed them like tomorrow. And so everybody went like literally tomorrow right it's like it's like oh I'm not going to the office again for four years I need new kinds of software.
And so everybody just went out and looked for okay we need we need a new way to do collaborative design we need a new way to do video calls. And we can't wait for someone else to attach it to the contract that we have we're just going to go sign up for the thing that everybody likes to the best. That's why Zoom got huge even though other video tools existed right that's why things like Figma started to take off because people just needed these new workflows.
And so there is this massive rush towards these so called best of breed things. And then what obviously started to happen is the big company started to tack that stuff on Microsoft builds teams Google invests in meat and so zoom becomes less competitive in its own way.
But what's wild to me is the this company octa which does basically like log in and a bunch of other stuff like you're talking about they started as a way to log into services and now there's like a whole giant back end authentication stuff that they do.
They do this really good survey called businesses at work every year and the wildest thing in I believe it was the 2023 one was that half the people who pay for Microsoft office also pay for Google workspace and half the people who pay for Microsoft office also pay for zoom.
And so we're in this place where we are very much in this sense of like you sort of need the basic bundle but then everybody is still in this moment willing to spend the money on at least like a handful of the tools that work around it.
So right now Microsoft is trying to keep building the walls around its bundle and you're seeing the same from a company like Salesforce which bought slack so that you spend more time in the Salesforce universe. But these individual apps that exist around them in many cases are just so much better that no one else has been able to catch up to them yet like meat is better teams is better people still really like zoom and I don't think that's changing at times.
One of the things that's really interesting about your description of the time on there is all of the new apps are necessarily in the cloud. Everybody went home we all have to work on mine together necessarily we're going to work in web browsers in a collaborative environment together and particularly on desktop.
There's no action in native apps there's still a little bit of action in native apps on mobile for over a few reasons that we've talked to lots of CEOs about on the show Dylan field see of Figma. He's like I got to build it natively on iOS because the browser isn't good enough to let me do figure on the browser on iOS. The second you open your MacBook the browsers are good enough and he's like this is where I should deploy an application this is where you meet it distribution.
The idea that all of these products of the apps work in the cloud so we can all collaborate together and you know all the data stored centrally and they're you don't have to sink it. Some huge powerful Mac app is going to show up or some huge powerful windows app is going to show up run locally on your computer and revolutionize the business world.
Okay I'm going to say this and I should preface by saying I have I have very little quantitative evidence for it but it is starting to be a thing I hear more and more in talking to folks who make this stuff I think it's coming back.
I really do and I think again this goes back to these sort of divergent needs of two group of people right you have the stuff in the cloud is easier to manage in so many ways right it's it's easier to understand who has it where it's easier to provision on different people's computers it's easier to manage you know where your data is like from a from a corporate management standpoint it's just better in so many ways to have stuff that is based in the cloud.
So I don't know if you've noticed this but everything seems to be down all the time now everybody is getting hacked all the time and suddenly the idea that the cloud is actually like a safer, sane or simpler place for your data I don't think feels true to people in the way that it once did and like all of that notwithstanding questions about is my stuff being trained for AI purposes do I want the AI stuff that is coming to all of these things I think you're starting to see the shift towards what some people in this industry called local first software.
And basically it's this huge sort of re architecting of the way that we think about files really away from the idea that like a file lives in the cloud and you and I both open an app and act on that file together that file can live on my computer as an offline local file that is mine in like a real meaningful way.
But still you and I can act on it together in a collaborative way that's possible to do it's just much harder software and we're only getting good at building that stuff now but I think it's it's stuff that works offline which like God help you if you're on a plane or in bad Wi-Fi or anything like it's so hard to do anything.
I think people notice that and we're coming back to this idea of like I want something that feels fast which means it has to be local I want something that is mine in a real way like it's a file I can see on my computer I think that stuff is coming back and it matters to people we're going to see that best of both worlds where we get the collaborative thing we get the cloud access we get the cross platform stuff it's manageable by your organization.
But it has the same feeling of like I can just open a thing on my computer and it works. It feels like that was the core way of thinking about things before broadband internet. Yeah, like Apple had entire software suite called iSync. Yeah, that's right. And no one ever used it because they're so complicated and fiddly and then the cloud existed and then you're you can just think everything over iCloud and so iSync went away.
But the idea that you would maintain sync on files across devices in a fairly manual way was built because the internet connections were not fast enough and now you're saying the people don't trust the cloud enough so we're going back to that model you could sort of argue that we skipped the correct middle step there right we're like okay doing the thing right you will file that says David presentation one and then you will back and it says David presentation to and then.
Final final final dot ppt like that sucks we can all agree that that is bad but we skipped over how do we make it easy for people to share things with each other all the way to what if you didn't know any of your data and and that you sort of left a good middle ground out there and I think I would not.
That everything that it's going to win but I think there's going to be a push back towards the idea of like local on device but still useful and in sync and collaborative stuff coming back that's a good place to break and when i come back and i want to talk to you maybe just about slack for the rest of the episode and put all these ideas into that little case study will be back.
Support for this episode comes from AWS with the power of AWS generative AI teams can get relevant fast answers to pressing questions and use data to drive real results power your business and generate real impact with the most experienced cloud. I'm back with verge editor at large David Pierce talking about the evolution of work by software.
David we just talked about kind of a lot of ideas all once the idea that everything would be in a cloud the idea that everybody in a team had to buy into a way of working to make a lot of this productivity software actually functional in an organization. The idea that the big players for bundling capabilities but you would still have some like renegade teams inside your company using the tool they want and then. I have people caught this you brought up the idea that sales force bought slack.
So I just want to put this into focus around slack in particular because it's just a good case study slack just turned 10 years old you and I have covered the hell out of slack i've interviewed Stewart butter field maybe not on the code over on the verge cast for sure he was the founder slack was especially revolution 10 years ago right is going to replace email and they kind of walked back from the idea that they were replacing email and embraced replacing email again.
Then Microsoft showed up with teams which is mostly a video conferencing platform they added some slack like features that.
Everybody has Microsoft office so they slack got out competed in that way they filed anitrust lawsuits in Europe and then sales force just by slack and like I was saying the idea is you're going to use slack why not use our CRM solution as well I shouldn't slack be the CRM solution that you are using you're talking to your team about selling stuff you're probably using sales
in a way now you can just chat to it through whatever mark any off AI system that is being integrated in sales force I watch stream force I couldn't tell you what's going on but that's basically the idea inside of that is the first thing we talked about which is the whole point of slack was that everybody
would buy into a new kind of metaphor for working and that would somehow change your company making more efficient and actually turns out that metaphor maybe didn't take and everyone just is like spamming each other with text messages
yeah I think one of my great theories about slack is that everybody uses slack wrong like everybody uses slack wrong and I think if you rewind all the way back to that initial launch of slack super battlefield about this really great blog post it's called something like we don't sell saddles here
and he basically outlines like the whole vision for what slack is going for and makes the argument that the biggest problem is that most people don't understand what they need slack for and so slack job is not only to convince you that you need this but that you need something like this in the first place and their whole idea was basically to be a search engine for all your stuff at work if you really want to boil it down the idea behind slack was not to be a chat app it was to just be a place to put all your stuff and all your stuff is communication it's files it's all the way back to that is the way it is and then it's all right
and it's files it's all these things that sort of you accumulate during the course of a work day and by having that all in one place that's accessible you could build something really powerful super cool idea has nothing to do with what slack is and how it's used right we use slack as an email replacement right I think Stuart was serious when he said they weren't trying to kill email
they were trying to like subsume it inside of a different system but they were always going to be like look if you want to send email to talk to each other that's fine but like when you need to share files do it in slack I think that is much closer to what slack wanted to be than what it has become and what it became is this awful engagement
that we all spend way too much time in never actually get any work done inside so I will note that the backron in for slack is searchable log of all communications knowledge yeah whether or not you start with the name or you end up with the name or you reverse engineer the name that was the acronym and the idea was that you would operate slack at the pace of email it wouldn't replace email but you're talking you're making decisions in slack
those you have a history of all of the files and figures and conversations around those decisions and then you could just go refer to it you could find it it's all it's all happening there and what ended up really happening is everyone is just chatting in real time in a like a fructively expanding number of slack channels and the service of this being case study where do you think the breakdown between the metaphors that slack wanted people to use
in the actual user behavior came from it's it's millennials and it's text boxes there's this long sort of mythological story about kynja which was the old CMS that they used to run at gocker and I have no idea if this is true but it is a story I heard that I spiritually completely believe which is that they ran an experiment at gocker where if they change the size of the default text box in kynja it would change how long people wrote if you give people a lot of space
make the text box big they're going to write a lot in it you fill the thing if you make it one line people are going to write one line and hit enter right slack made it one line it looks like a thing where you would send text messages it doesn't look like an email inbox you don't have subjects you don't have two lines you don't have a thing for a signature like can you imagine if you
have a signature at the bottom of every slack message you look like a lunatic and so all of these like product incentives taught you to do it really fast the main thing there was a single line of text and everybody else uses a single line of text in messaging apps and so we all just treated this thing like messaging apps and it was a bunch of millennials who came into the workforce and are used to the like type of thought press enter
type another thought press enter like if you get the text that is two paragraphs from somebody either somebody died or you're being broken up with like those are the two options and instead we just trained everyone to talk in work like they talk to their friends in text and culturally I think that is really interesting and complicated but it immediately broke that paradigm that you're talking about which is slack even has always said that slack uses slack in a much more considered way people
write much longer things it's designed less for like minute to minute updates of what you're doing all day and more for like I here's what I accomplished during the day again so that someone can go find it later you're not expected at slack to be in lots of rooms there is a norm that if you need somebody you mention them slack set up all these rules but didn't bake any of it into the product they build a product that looks like text messaging and so people used it like text
messaging and slack has now spent the last decade being like no it's all about rules you have to set up norms you have to teach each other how to use the app and it's like no stop building me a text messaging when store was still running slack and he came on the show he talked a lot about how they on boarded people into slack and taught them how
to use slack and they spend a lot of time teaching new slack employees how do you slack I had the same reaction is you which is why doesn't the product teach people how do you slack and it's kind of all the way back around the first you said you can either build a very opinionated product that works extraordinarily well for a small number of people or you can just take all the training meals off and let people sort of build whatever product they want and so that they can work however they want
to do that and that's how you get even a Microsoft Excel they can't take any features out of Microsoft Excel and point people to a simpler version of it because every 5% of users is millions upon millions of people slack is in that zone a lot of other products are in that zone is it just we have to go through other kinds of
codes we all used IRC and email so then we use tip chat for 5 minutes and then we use campfire now we slack and maybe one day slack will just fully give way to teams or whatever maybe I mean I think to be clear the idea that you should spend a lot of time training people how to use your most important products when they join your company is really good and no one does it like you should have to spend a day learning how your company communicates when you join a
company that's of matters and we just like hand people slack and they're like we use slack and that's as much as you get like do you know how to use slack like sure but I don't know how to use like the way that you use slack right and that's of matters a lot I talk to
this woman Laura Martin who is like Google's productivity guru and one of the things she recommends to everybody is like just muck around in the settings just go spend 10 minutes clicking all the buttons in the settings just to see how the thing works and
even even one extra tick of understanding of the software goes an incredibly long way but if you're slack and you both use this product and run your company on it the one does not absolve the other right you can and should train people on your company's best practices for slack that doesn't mean that everyone else should figure out your best practices just kind of buy osmosis that's not how it works
overwhelmingly the question is are we ever going to go to foreign swing the pendulum back because so far there's really no evidence that we're going to right there are a lot of people who complain that everything is moving too fast and we're all to we're all to attached to these messaging systems and we can't keep up with everything and it's
making us crazy and we all spend time and slack instead of actually doing our jobs and there's just no indication that that's going back you can actually make the email represents a much sainer more functional way to run a business than inside of slack but like do you want to go back to email I don't want to go back to email and so far all we do is faster and bigger and more full of stuff and we just kind of rely on people to solve it for themselves and
either we're going to get a set of really clever products that does that for us without killing the idea that people are being productive because you have to make it look like everyone is productive and one thing slack is very good at is making itself look really engaged and when it looks lively all the time which makes managers and bosses feel like things are
happening and that feels good whereas if you don't hear from anybody for eight hours really because everybody working with everything and so squaring those two things is really hard but I think the only way we get off of this road to insanity that we're on with a lot of these communication tools is to find a way to do both of those things and I'm
honestly not sure what that looks like let me just go at switching costs in that context for one second we can keep picking on slack and I think both of us are motivated to do I would like to use it all day long yes it's a little unfair but we both we both use it all day long but if I was to say okay the verges in using slack anymore we're switching back to email the switching cost of that would be almost impossible high I think we
would just have a straight meeting we would not know how to work quite honestly if I showed up and I said we're going to stop using concur we're going to use some other enterprise provider for expenses and travel I don't think our team would care a lot but it almost would be harder to switch because no one cares a lot like
that I could bring down the dollars by some amount 10% 20% great that's a good reason to switch but then everyone would I would lose that in productivity because no one would pay attention to the email that we're switching out flims for flams or whatever we're doing and then they would try to file an expense they would use the old app and then I we would just be
sort of running the individual training all the time is that something you can fix is that we just get the bundle for like screw it microsoft just do it all for me is that the opportunity for any of these companies is to make an expense software that everyone loves so much that everyone actually pays attention to the it's one really good reason to keep building your bundle right if I have an expense product that you hate and someone else has an expense product that you hate that you
actually already pay for I can't win that fight right that is the great challenge and so if you're trying to get into that world you either need to be cheaper to make the people who actually pay for this stuff happy you either need to be like vastly better like I think even being slightly better doesn't get you that you have to be like orders of magnitude
better or you have to do something else that the existing apps don't do like I think one one really good example is in the expenses world I wouldn't swear to this but I think it's true that expense of I was the first company to really do a good job of letting you take a picture of a receipt and turn it into an expense and uploaded unbelievable like the greatest thing that ever happened to the product of tracking expenses was being able to take a picture of a receipt and have it like
OCR out all the relevant stuff and turn it into expense I think it was expense of I who did it I don't know who I was for sure whoever it was congratulations you you win and they did and that like expense of I became hugely successful based on having like a good mobile app right that's a thing when you can add something
meaningful to that that goes a really long way for those kind of middle tier products you encounter but don't really care about all that much there's just not that much surface area to do that but then the stuff that people use every day the switching cost is so much higher because it's so much more entrenched trying to get someone to stop using an app that they hate but have used for 10 years is so so hard even if they hit it they will tell you every single day that they
hate it and you'll say here's another one it's better and they'll say oh god because people don't care most people have jobs to do right like most people do not use software for a living they they use software as little as possible so that they can go do the thing that they do for a living and I feel like that is the exact right balance for those people and software gets that wrong where instead they're like here's more stuff for you to do come switch to our software and people like nothing
yeah why haven't Microsoft and Google just run away with this is it and I trust litigation is it they're not good at everything they try to do is that Google kills its products too fast I mean to some extent they have run away with this right I'm convinced that Excel is the single stickiest piece of
software on earth you see it and hear it all the time that like the companies I was mentioning that pay for Microsoft office but also pay for zoom or workspace or whatever that's all Excel man that is all Excel like you can build good presentation
software you can build good document editing no one can beat Excel it is just not possible and who pays for this stuff is the people who use Excel all day so it Excel is so sticky and the problem is yes it's very hard to do all of these things really well it's also just a matter of
like focus and resources for Microsoft I don't know that adding one more tiny piece of software makes your company more likely to sign up for it Microsoft is going to keep doing that stuff but at some point like office is pretty sticky already and I think for Microsoft to spend the resources and time and energy to add more stuff is actually a pretty big bet for that company to make it's why teams was such a big deal right that
Microsoft saw all of a sudden pandemic starts the idea of I think video chat in particular was like an existential shift in how we communicate it work it had the potential to just like destroy outlook and become the center of everything and zoom immediately sets out to build a whole office suite right that was the thing zoom was going to do they were like we're going to make video into everything we're going to start doing yoga classes or resume but we're also going to build like zoom
male and zoom docs and that became the center of how people worked in Microsoft goes oh God maybe that is going to be the center of how people work and built teams and crushed it because ultimately the free thing usually wins we need to take another quick break we'll be back support for this episode comes from AWS AWS generative AI gives you the tools to power your business forward with the security and speed of the world's most experienced cloud.
I'm back with verge editor at large David Pierce discussing the next big thing and enterprise software and if it will be as big of a change is software is eating the world. The last turn I want to talk about and I'm very curious if you've actually seen any features here that work or are valuable I already know what you're about to ask it's obviously I so the dream here and I'll you mentioned zoom the CEO zoom Eric on is on the show and he is dream is that we'll make an
AI agent out of you with everything zoom knows out of you in your a agents potentially thousands of them will go off and have meetings in your behalf while you sit on the beach. I want to be 100% clear this is a real thing he said on the show this is the thing he wants to build. I don't know about that.
This is gentle of a evaluation of that idea as I can give some were underneath that is I work at a company where a lot of people have made a lot of decisions I don't know what those decisions are there might be some wiki and some horrible piece of enterprise wiki software
that don't really know how to access my octas acting up and I just have whatever I'm not going to do it this locker is too busy I have no idea what to do is to make the made here I'm afraid of saying a lot wrong thing all this is a mess I'm just going to ask some all knowing enterprise AI hey what's our history of sales in this region and who is our biggest client and they will spin through all the company's data and answer the question and tell me how to make the next move.
That's the dream is any of that a reality yet. No, I think it's it is plausible in a way that I find a lot of AI stuff really implausible because in a real way most of the data that you need exists right like companies have that data somewhere it is it is written company handbooks get written down these
are placed somewhere the problem is that they are in thousands of places right again I was just rereading this octa thing ahead of our recording here and the the average company in the United States pays for I think it was 110 different pieces of enterprise software that's too many and what it means is if you want to find a thing God help you
right like where do you even start and so what you've seen I think is the beginning of what's about to be another big re bundling as a result of that because that thing you just subscribe is super enticing there are studies everywhere that say we spend a huge amount of our time at work just looking for stuff and that actually easy access to information would be like the greatest productivity
and able to in modern history and the idea that I could just say what is our sales history with them or like who's the contact over there and get that stuff quickly incredible and so every company is after this right like drop box built this thing dash that searches
across all your stuff and all your different apps you see companies like notion which are trying to do more and more stuff they're building out new features just in service of getting all that information inside of the app so that you can query it with AI microsoft is doing it with co pilot Google is doing it with Gemini like
the first time in a while being the bundle is more valuable than the sum of its parts in a way that isn't just sort of purely about like contract values and it's easier to have one relationship instead of several now like your products can all be better because you control more of them and I think what we're going to see as a result is this rush back to I don't want to have 50 best in class apps that don't talk to each other I want to have six things that do all 50 of those things even if you're not going to do it
okay for now we can see names of things you can say as soon as youorn the info and the all right, there you come by, and then the link is in the description of one-line communication.
So this stuff is coming, and I think it's gonna be really powerful, but it only works if it's all everywhere, because this is one of those things that, like if you solve 70% of my problem, you've solved none of my problem, and getting there is gonna take a minute, but I think the push towards that has already started in a pretty big way. How do you square that with, hey, there's a big push to run more software locally.
Hey, people are very cognizant of the amount of data they're giving up to essentialized, AI providers or centralized cloud providers. Hey, I'm just generally uncomfortable with my law practice, my medical practice, having all of its data taken up into the cloud, where I'm no longer in control of my client data or my patient data. I'm hearing a lot of excitement from companies about open source models.
I think right now you look at the open AI's and the anthropics of the world, and even like what Google is doing with Gemini, and again, we're in this phase of everything is humongous and in the cloud, but eventually these models will run on your device, they'll be able to run locally on your own instance. What I don't think is going back is, I think AWS and Azure and Google Cloud are gonna be fine.
I think on-prem servers are not coming back, but at least you're gonna be able to exert some control inside of that. The AI systems will be something run by your company inside of your company more over time than they currently are. And I think it sort of jives with that whole idea of like, I want to have all the conveniences of all of my stuff being online and accessible everywhere and sort of functionally managed by somebody else, but I also want that control that this data is mine.
I know where it's going, I know how it's being used, and I know where to find it. And that balance has been really hard to strike over the years, but I think especially as these AI models from Meta with Lama and others get better and faster and especially like cheaper and simpler and more local, like my company approved laptop is going to be more important than ever. The big idea that we start talking about is the interesting quotes software is eating the world.
All these businesses are software businesses where they're gonna operate on software. That has very clearly happened. Most people show up at work, they get handed an iPhone that runs their enterprise software, they get handed a laptop that runs their enterprise software, no matter who you are, it's all just happening. It's all just happening inside of software and then some other actual work happens somewhere else.
I think we can agree for the purposes of this to code-oper, so that is almost complete. Like that transition is complete in the workforce. Is the next-turn AI that's actually gonna redefine how we do work? Because the AI companies are absolutely betting that they can pay off all this investment with that level of change in turnover and upgrade investment.
Yeah, and not only are the AI companies betting on it, like how many CEOs do you think you've had on this show this year who have not mentioned AI once? I honestly, I would be shocked if it's more than one who isn't out here talking about AI. Because again, you like have to have a strategy or everybody thinks you're an old, fusty company that nobody cares about anymore and your board fires you and that's a whole thing. But also, again, the promise is so huge, right?
The idea that AI can remove a lot of the busy work that we have to do. If you turn making a deck out of an Excel spreadsheet into just a command to an AI, like that's a measurable productivity increase in the world and the same thing with the finding of the information and even some of the generative stuff that's starting to happen. If that stuff works and that is a bit, like I cannot emphasize the if enough there.
It's not when it's if in a very real way, but if that stuff all works, it sincerely changes the way we do just about everything. And it means you and I, we probably won't go to the beach more often, but we get to spend more of our time doing things that are like interesting and rewarding and valuable rather than busy work. I spent a lot of my time doing busy work. You don't because you just have people printouts on your desk for you to circle things on. But like dream. Life is busy work.
And if we can get rid of that, there are all kinds of really complicated societal implications that because frankly, a lot of people's job is busy work and a lot of people do busy work for a living. But the question of what could this mean if it hits, if it works, it's just too big for anybody to not try. Is that how it's going to get sold? This will make your company more productive. See, might as well just let digital God make a bunch of decks for you.
Yeah, the alternative is this is going to make you more productive so you can fire half your staff. And like a lot of these companies don't want to say that even though that is both what they're buying and what they're selling is I can fire a bunch of people and replace them with this software. I think in the near term, the actual real thing that's going to happen is it's just going to automate away a bunch of work.
Like I think what we're looking at is something much closer to the advent of computers when all of a sudden instead of sitting at my desk, writing out spreadsheets by hand, I could just sit there and type one and when I changed the number of the other numbers would change. Huge societal revolution probably cost a lot of jobs but was not the like be all and end all of society forever. I think we're much more at that era now.
Where all of a sudden we are about to have this real sort of step change in what technology lets us do very quickly. And then the question is what are we going to do with the time that suddenly appears as a result? And with computers, it was we're going to make ourselves busier talking to each other and looking at TikTok. What it will be with AI, I think we're going to answer. All right David, we're going to have to have you back soon. Thanks so much for being on the cutter. Thank you.
I'd like to thank David for taking the time to join the coder and thank you for listening. I hope you enjoyed it. If you'd like to let us know what you thought about this episode or really anything at all, drop us a line. You can email us at decoderatthewvrish.com. You really do read all the emails. Or you can hit me up directly on Threads, I'm Matt Reckless, 1280. We also have a TikTok, check it out. It's at DecoderPod. It's a lot of fun.
If you'd like to code or please share it with your friends and subscribe wherever you're podcasted. Decoder is a production of the verge and part of the box when we podcast network. Our producers are Kate Cox and Nick Stat. This episode was edited by Zander Adams, which supervising producer is Liam James. The coder music is by breakmaster cylinder. We'll see you next time. Support for this episode comes from AWS.
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