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Silicon Valley will eat its AI competitors in 2026
Two deals hastily wrapped up before New Year offer clues to how that may play out with AI.
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The year 2026 will see a Darwinian thinning as a few AI winners continue selling, while many weaker players get gobbled up by large technology companies.
PHOTO: CFOTO/Sipa USA via Reuters Connect
Parmy Olson
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Venture capitalist Marc Andreessen famously declared in 2011 that “software is eating the world”. In 2026, Silicon Valley will be looking to feast on artificial intelligence, or AI, as the relentless hype that’s driven the creation of nearly 40,000 AI start-ups crashes into the cold logic of business economics.
US companies spent US$37 billion (S$47.5 billion) on generative AI software in 2025, up from US$11.5 billion the year before, according to venture capital firm Menlo Ventures. But much of that spending has been across a motley array of tools.
