(Yicai) March 12 -- Artificial intelligence is not the end of the software industry, the China chairman of US computing giant International Business Machines said after the launch of AI programming tool Claude Code triggered a drop in global software stocks.

True information technology modernization is far more than just simple code rewriting or translation, Chen Xudong, who is also the general manager of IBM China, told Yicai. It is a large-scale process that involves hardware upgrades, organizational restructuring, and business modernization, he explained.

Taking IBM's 60-year-old mainframe as an example, its vitality lies in the systematic rhythm where hardware must be regularly updated due to supply chain iterations, and software is continuously adjusted and adapted accordingly, Chen noted, adding that customers have been very familiar with this process for a long time.

The panic in the capital market mainly stems from two speculations, Hou Miao, GM of IBM China's technology division, told Yicai. The first one is that AI will enhance individual work efficiency, leading companies to lay off staff, thus purchasing fewer software licenses, which will result in a contraction of software companies' business. The second one is that AI tools are sufficiently powerful that they may break down industry barriers.

The reality is that large software firms, including IBM, are the earliest and largest users and beneficiaries of advanced AI tools, Hou pointed out. At IBM, over 10,000 developers are already using both in-house and third-party AI tools, applying them throughout the entire development lifecycle, from demand research and code generation to testing and product documentation.

The revolutionary increase in productivity has not led to layoffs, Hou said. Instead, it has liberated employees from repetitive tasks, allowing them to focus on developing new products and exploring new markets. Therefore, AI is not the end of business, but rather an “accelerator of innovation,” he added.

Last October, IBM had already integrated the Claude model series developed by US AI firm Anthropic into its software products, accelerating the development process of enterprise-level AI, said Zhai Feng, chief technology officer of IBM China.

Enterprise-level applications, such as resource planning systems, are entirely different from standalone applications with simple functionalities, Zhai explained. They are intricately connected with complex logic across various processes, including research and development, supply chain, sales, and warehousing.

This long-accumulated industry knowledge and business workflows form an invisible, complex network that cannot be spontaneously created by an AI tool without first being fed with all the detailed information, according to Zhai.

OpenClaw and similar AI agents are more suitable for individuals and small businesses, as large enterprises find it challenging to adopt them quickly due to issues related to permission management, Zhai noted. For these products to enter large firms, appropriate permissions management and compliance controls must be established first, he added.

Editor: Futura Costaglione