Why Anthropic’s AI tools won’t kill IT services

Indian IT stocks faced a sharp sell-off on Wednesday, mirroring weak global cues. Shares of companies such as Accenture and Cognizant, along with SaaS and data firms like LegalZoom and Reuters, took a beating on the Nasdaq on Tuesday. The trigger was Anthropic’s launch of new AI tools that are expected to bring significant changes to IT services companies, SaaS firms and data providers.

Anthropic has rolled out 11 new plugins under its Claude Cowork suite, spanning domains such as productivity, product management, marketing, legal, finance, enterprise search, bioresearch and data. The launch has intensified fears that AI agents could replace entire categories of software services. If that were to happen, it would severely disrupt IT services companies, large SaaS firms like Adobe and Salesforce, and data providers such as Reuters. Investor panic over this possibility led to a broader sell-off across technology stocks.

The global technology industry is undergoing fundamental changes, largely driven by AI-led development. Agentic AI tools are rapidly becoming the new normal, growing increasingly sophisticated as innovation accelerates. Anthropic’s latest offerings provide a glimpse of what lies ahead. These tools are capable of streamlining many software processes that form the core of the IT sector’s business. As a result, fewer human resources and traditional ERP systems may be required to execute client workflows.

This potential disruption to the traditional business models of IT services firms, SaaS companies and specialised data providers hit the Nasdaq hard, contributing to a nearly 6 per cent fall in the Nifty IT index on Wednesday.

But is this an apocalyptic moment for the sector? History suggests otherwise. The global technology industry has gone through several cycles, and in each phase some companies perished while others prospered. From the dot-com bust to the cloud and digital waves, it has always been a story of survival of the fittest.

The ongoing AI wave will undoubtedly transform multiple segments of the technology industry. Some players may fall behind, but others are likely to emerge stronger. While SaaS companies globally are facing pressure as AI tools begin to replace traditional ERP software, new innovations are also emerging. Many SaaS firms are building AI-powered, business-specific platforms to stay relevant.

Similarly, the Q3 results of Indian IT companies indicate that earnings have broadly stabilised despite AI-led disruptions. This suggests that predictions about the imminent death of IT services and SaaS firms should be taken with a pinch of salt. Technology companies are not sitting idle in the face of disruption; they are actively innovating and adapting to the new reality.

Moreover, it remains to be seen whether enterprises are comfortable deploying AI agents to handle sensitive and valuable data without human supervision. So far, AI adoption rates appear broadly in line with previous technology cycles, indicating that enterprises remain cautious and prefer certainty before migrating large datasets. AI will fundamentally reshape the IT services industry, but it is unlikely to make it irrelevant, contrary to the more extreme predictions.