Are they software companies or do they just have software problems?

You don't need to go far online today to find rhetoric about software being doomed. The moats are gone and companies are in trouble. I'd argue that for a subset of companies, this is true. For others, there's an incorrect assumption at play.

The assumption that because you build technology you're a software company. Many of today's top 'software' companies just happen to use software rather than sell it. They become great at technology because it's their distribution mechanism. They solve hard software problems because they are big companies. If they could choose to do that another way they probably would.

I think the easiest example of this is Spotify. It seems to be brought up a lot, probably because folks are familiar with it. There are people saying that because they can 'clone' Spotify with AI in an afternoon that the company is doomed.

They prompt their way to a UI that looks pretty good, maybe even one that can play back some locally stored tracks. I don't want to discount that this is possible and quite amazing. The ten year old version of me using WinAmp on Windows XP would have thought this was magic.

The reality is however, that Spotify is not the Spotify app. Spotify has hundreds, if not thousands, of legal agreements that let them legally stream music in exchange for some fraction of user revenue. No amount of prompting is going to get you that.

The software that exists behind Spotify is impressive, delivering that much content at scale takes a lot of work. Despite that, you're not signing up because you want a globally distributed CDN for music. You sign up because you want to listen to music.

This is true for a lot of today's biggest software companies. They use software, it's critical to their business, but it's not what they sell. It's a platform to distribute their value. Be that services, content or anything else.

That isn't to say there are no software companies. Some companies like Google, Amazon and Open AI sell software in its pure form. Even then it's only a part of their business. The things they have that make them valuable aren't easily copied.

Now, this is easy to talk about with well established tech giants. What about the many many smaller companies in the broad category of "software"? There are plenty at risk. Whole swathes of Vertical SaaS only existed because the experts in the field couldn't write software. That isn't the case any more. It probably shouldn't have ever been.

If you're a founder in 2026 and are relying on having some code as a way to win you should be worried. The dynamics of build vs buy have changed for a wide spectrum of software products. The bar is higher than ever for delivering real value.

In the most extreme cases, this is easy to point out. Spotify is obviously about music. A SaaS app that you can replicate with half an hour of Claude Code is obviously in trouble. The hard part of this new reality is that your reality is probably a lot more subtle.

It's unlikely that your whole business is that thin. There may be features on your roadmap however, that are. The thing that is still as true today is that time is your most valuable asset. Time spent on work that isn't related to your true, core, value is time wasted. It has always been wasted time, but now the gap closes a lot faster.