The Endgame Of Vertical Integration
Software Synthesis 2 months ago 17
AI model companies like Anthropic are increasingly building their own application layers (harnesses) alongside their models rather than relying on third-party developers, forcing specialized agent labs to consider training their own models to remain competitive. The article cites Anthropic's inference margins improving from 38–40% in 2025 to over 70% currently as evidence that integrated model-harness development delivers superior performance and economics. Agent labs focused on specific domains like legal or finance must now choose between building custom models themselves or accepting diminished competitive positioning as foundation model companies dominate both the underlying intelligence and the application layer.