The article also suggests that the market is willing to pay more for software with new AI capabilities, which could provide an opportunity for software companies to upsell existing customers and attract new ones. This could lead to a wider TAM for software companies, allowing them to grow faster and larger over time. The article concludes by stating that AI is serving as a near-term growth boost for tech companies and increasing their potential size in the long term.
Key takeaways:
- Emerging price points for AI-powered software products are expected to boost the total addressable market (TAM) for technology products, potentially accelerating growth in tech companies of all sizes.
- After a period of deceleration, early-stage software companies are expected to regain momentum in 2024, with Q4 2023 results already showing better-than-expected revenue and profit for big tech companies like Microsoft, Meta, and Amazon.
- The market appears to be accepting the higher cost of software with new AI capabilities, providing an opportunity for software companies to upsell existing customers and attract new ones.
- AI is serving as a near-term growth boost for tech companies and increasing the potential size they can grow to over time.