While tech giants could technically replicate Perplexity, their core business models—advertising for Google, e-commerce for Amazon—create a fundamental conflict of interest. An independent player can align purely with the user's best interests, creating a strategic opening that incumbents are structurally unable to fill without cannibalizing their primary revenue streams.

Consumers can easily re-prompt a chatbot, but enterprises cannot afford mistakes like shutting down the wrong server. This high-stakes environment means AI agents won't be given autonomy for critical tasks until they can guarantee near-perfect precision and accuracy, creating a major barrier to adoption.

New AI coding agents excel at creating fresh applications but struggle with complex, existing codebases. This gives flexible startups a significant advantage over large companies burdened by legacy systems, fundamentally rebalancing power in the tech industry.

The AI revolution may favor incumbents, not just startups. Large companies possess vast, proprietary datasets. If they quickly fine-tune custom LLMs with this data, they can build a formidable competitive moat that an AI startup, starting from scratch, cannot easily replicate.

AI favors incumbents more than startups. While everyone builds on similar models, true network effects come from proprietary data and consumer distribution, both of which incumbents own. Startups are left with narrow problems, but high-quality incumbents are moving fast enough to capture these opportunities.

As AI agents require increasingly deep access to personal data, users will only grant permissions to companies they inherently trust. This gives incumbents like Apple and Google a massive advantage over startups, making brand trust, rather than technological superiority, the ultimate competitive moat.

Product managers at large AI labs are incentivized to ship safe, incremental features rather than risky, opinionated products. This structural aversion to risk creates a permanent market opportunity for startups to build bold, niche applications that incumbents are organizationally unable to pursue.

Unlike previous tech waves, AI's core requirements—massive datasets, capital for compute, and vast distribution—are already controlled by today's largest tech companies. This gives incumbents a powerful advantage, making AI a technology that could sustain their dominance rather than disrupt them.

Unlike past tech shifts, incumbents are avoiding disruption because executives, founders, and investors have all internalized the lessons from 'The Innovator's Dilemma.' They proactively invest in disruptive AI, even if it hurts short-term profits, preventing startups from gaining a foothold.