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Artificial intelligence tools are making it simpler and more cost-effective for companies and government agencies to switch software providers, according to The Information.
This could affect enterprise software providers such as Microsoft (NASDAQ:MSFT), Palantir (NASDAQ:PLTR), Salesforce (NYSE:CRM), ServiceNow (NYSE:NOW) and SAP (NYSE:SAP).
New software licenses, transferring data, integrating new systems and training have traditionally made switching software providers an almost herculean task.
However, IT executives said AI tools are making these steps much easier than before, which also makes it cheaper for enterprises to switch providers, according to the report. According to one example, a Minnesota-based company was using OpenAI’s ChatGPT to help write code for transferring its data from Microsoft Dynamics to a newer sales application. Another example found the time and cost to switch providers had declined by 50% using AI tools for the switching process.
Enterprise software stocks were mixed during Monday afternoon trading. Microsoft had slid 0.6%, Palantir was down 1%, SAP (NYSE:SAP) had slipped 1.8%, ServiceNow edged up 2% and Salesforce was relatively static.
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