For centuries, the biggest goal of science was alchemy — to turn lead into gold. It turns out this is actually possible in nuclear physics and is called transmutation. Bombard mercury with neutrons in a nuclear reactor or particle accelerator…and presto! Gold. Today, thanks to AI, we are witnessing potentially the greatest transmutation in history. Software becomes labor. It’s the new E=MC2. Capital buys coffee, engineers, and GPUs. Out comes code that takes the role of labor. This will both grow existing software markets and create many new software markets where “per seat” pricing never allowed for a large outcome. Historically, much of software digitized an offline form of storage, put it in a database, and then provided an accessible, permissionable front-end for the end-user who likely did not know SQL, with the speed benefits of a digitized, networked medium.

• PeopleSoft and then Workday digitized the HR filing cabinet.
• Zendesk digitized old-fashioned support “tickets.”
• Quicken and Quickbooks digitized old-fashioned ledgers.
• Epic and Cerner digitized health records.
• Salesforce digitized the Rolodex and the chalkboard pipeline.

E-mail digitized, well, mail! Instead of having Bill the HR clerk or Sally the accounting clerk literally “fetch” the files from the filing cabinet, William and Sarah in IT now exist to make sure that everyone in HR or accounting is properly provisioned and has access to the system. But accounting headcount and HR headcount is…the same.

Full commentary : How AI Will Turn Capital into Labor.