The AI Ate My Company

Brandon Thomas says he got tired of paying to quit his software.

After one Adobe cancellation fee too many (he calls it a "dark pattern"), the Atlanta programmer, who has spent about 15 years building payment systems and robotics software, decided to write his own tools. On September 30th he created a repository called PhotoCraft. Within about a week he had published free, open-source stand-ins for seven of Adobe's best-known products, from Photoshop and Illustrator to Premiere, Lightroom, After Effects, InDesign and Acrobat, under the banner ArtCraft.

They are written in Rust. Most of the typing was done by Claude Opus 5.5, an AI model from Anthropic. By this weekend PhotoCraft had nearly 45,000 stars on GitHub, the closest thing software has to a standing ovation. "Software is over," Mr Thomas declared on Hacker News.

Chamath Palihapitiya, a venture capitalist, goes further. On this week's All-In podcast he called it "the most important thing that happened this week in AI". "I think that IP and software was effectively rendered worthless two days ago," he said.

His argument is less about Photoshop than about plumbing. Salesforce has made its software "headless", meaning AI agents reach it through code rather than through screens, and others are following. Once every service can be wrapped in agent tools and wired to every other through MCP, the connective standard for AI agents, "the value of IP does no longer exist in software," he argued. At 8090, his software firm, clients used to haggle over who would own the code it wrote for them. Now, he says, his answer is "Who cares?"

Both men are onto something. Neither has it quite right.

Start with the facts. Mr Palihapitiya said the apps had been "decompiled", meaning Adobe's own code was taken apart. The project says the opposite. PhotoCraft's README describes a "clean-room" rebuild, "implemented from public specs and observed behaviour only", with no proprietary code, shaders or assets. Eric Raymond, an elder of the open-source movement, guessed on X that Photoshop had been decompiled into a specification and fed to a model; nobody has produced evidence that it was. The distinction is not pedantic. A clean-room copy of how software behaves is legal in most places. A copy of its code invites lawyers.

Then the quality. The same README calls PhotoCraft "early alpha" and "not yet a Photoshop replacement for daily professional work". It lists the gaps itself: generative-AI features, a dozen or more missing tools, depth in typography and professional workflows, and compatibility with plug-ins. Early users report glitches and odd tool behaviour. Of the seven apps, only the Photoshop and PDF replacements have reached alpha; the rest are "in development".

And then the history. A free alternative to Photoshop has existed since the mid-1990s. It is called GIMP. Adobe's revenue grew from under $1bn then to $23.8bn last year with GIMP a single download away. As Aakash Gupta, a product writer, pointed out on X this week, what Adobe sells was never mainly code. It is the .psd file every client sends, the plug-in ecosystem, the enterprise contracts, and decades of muscle memory in millions of hands. None of that sits in a GitHub repository.

Investors priced the threat before the clone existed. Adobe was worth more than $300bn at its peak in late 2021. It is worth about $92bn today, even though revenue rose 13% in the quarter to August, to $6.8bn, and annual recurring revenue reached $27.5bn. For two years the market has been betting that AI would do to Adobe's moat roughly what ArtCraft now dramatises.

So what did change last week? The price of getting most of the way there. Taking a mature application to "mostly works" used to need a funded team and several years. One experienced engineer with a coding agent did it in days. The hard end (colour management, codec licensing, print workflows, file fidelity that studios stake their reputations on) took Adobe three decades, and that is still where the money sits. ArtCraft's own numbers make the point. Its PSD files, re-saved, render identically in 307 of 309 test cases. Professionals live in the other two.

Here Mr Palihapitiya's bigger point bites. If code is cheap to reproduce, "we have proprietary technology" is a weak pitch to an investor. Somebody can rebuild your product between two Mondays. What survives is distribution, trust and owning the workflow: who the customer calls when a print run goes wrong, whose file format an industry speaks, whose name is on the contract. The firms that hold those just watched their hand get stronger.

That is the human part of the story. One person, irritated by a cancellation fee, took on a $92bn company over a few weekends. That is a real expansion of what one human being can do. But the things that make Adobe hard to replace (relationships, habits, judgment about what good looks like, someone to hold accountable) are built by people, with people, over time. Software has become cheap to copy. Trust has not.

With thanks to Aakash Gupta, whose analysis on X prompted this piece. Chamath Palihapitiya's remarks are from this week's All-In podcast.