Market Hype Around AI Agents: Are Software Companies Overpromising?
As generative artificial intelligence technologies continue to evolve, software companies are increasingly marketing their latest advancements as “agents” and components of a “digital workforce.” Companies like Salesforce and IBM are championing these so-called AI agents as game-changers poised to revolutionize industries. However, industry analysts express skepticism regarding these claims, particularly concerning the agents’ ability to genuinely take over jobs or generate substantial revenue in the near future.
The Promises of Generative AI
For over two years, tech executives have promised significant sales increases from generative AI technologies, while simultaneously minimizing immediate job displacement concerns. Despite these optimistic forecasts, the anticipated sales boons have yet to materialize. Enter the latest marketing catchphrase: AI “agents.” In tech circles, the phrase “2025 is the year of agentic AI” has gained traction, signaling a shift toward more capable software solutions that can perform actions beyond simple data retrieval.
According to Maribel Lopez, founder and principal analyst at Lopez Research, “agents are kind of yesterday’s bots on steroids.” This new generation of AI software aims to perform more complex tasks and deliver greater value to businesses.
Salesforce’s Agentforce 2.0
Salesforce has positioned itself at the forefront of this AI agent revolution with the rollout of Agentforce 2.0. CEO Marc Benioff claims this innovation taps into a potential “multitrillion-dollar market” and presents it as a means to optimize human labor and reduce costs. In a recent interview, Benioff highlighted a personal anecdote where utilizing Agentforce on Salesforce’s help desk halved the number of customer support requests requiring human intervention. This, he asserts, could translate to significant savings for Salesforce’s customers.
Benioff argues that the current stagnation in the labor market, exacerbated by declining birth rates and a shortage of qualified workers, necessitates the adoption of digital labor solutions. He emphasized that leveraging AI will enable companies to grow more efficiently in a challenging hiring landscape.
Analysts Remain Skeptical
Despite the enthusiastic rhetoric coming from corporate executives, analysts are cautious about the actual capabilities and financial impact of AI agents. D.A. Davidson analyst Gil Luria has been vocal in critiquing the marketing efforts surrounding AI agents, dismissing Salesforce’s commercials as misaligned with the needs of its actual customer base. Luria contends that if Salesforce is unable to communicate the value of its tools effectively, it indicates a significant disconnect between the product and its potential to deliver substantial benefits.
Luria argues that the current wave of AI software does not meet the academic definition of an “agent,” which suggests an advanced ability to make decisions based on complex knowledge. Instead, he compares them to “autopilots,” which efficiently perform seamless functions but lack true cognitive agency. For instance, whereas existing systems can draft responses to emails, they cannot independently navigate the intricacies involved in making intelligent business decisions.
Labor Market Concerns
While the conversation around AI agents implies potential job displacement, industry insiders maintain that these effects are not imminent. Lopez suggests that despite advancements in AI technology, significant layoffs due to AI implementation aren’t likely to occur this year. Instead, certain sectors, such as customer service and software development, may see changes as a result of the evolving landscape.
Long-Term Prospects
Despite the hype, analysts agree that broad effects on employment remain years away. “In 10 to 20 years, many administrative tasks will be automated, leading to a productivity boom across the global economy,” Luria explains. However, for immediate concerns, small-scale, niche AI applications are more realistic, and widespread labor impacts are not on the horizon.
Investor Considerations
For investors, the critical question centers on revenue generation rather than labor displacement. Benioff announced that Salesforce’s Agentforce has secured over 3,000 contracts, with some reaching into the eight-digit revenue range. However, it remains unclear how many of these contracts will guarantee a specific revenue stream, as some are based on usage rather than subscription models. Luria notes this transition from a subscription to a consumption-based model may take years, if not decades.
As the digital landscape continues to evolve, it is crucial for investors and businesses alike to navigate the complexities of AI technology with caution. While the potential is undoubtedly vast, the reality of its immediate financial and employment implications may not live up to expectations, especially in the context of agentic AI.