The Three
Phases Of
Software.

I'm at my desk. I've just finished writing a brief in my head, the way I always do, and I open the thing I work in... not Notion, not Google Docs, not a code editor... and I say "draft this for me, three paragraphs, voicey, file it under issue 005."

A few seconds later it's drafted. I read it. I don't like the second paragraph. I say "the second one's too earnest, drop the warmth, keep the punch." It rewrites. I say "good, publish it to the play directory and put a card on the homepage." It does. Live URL appears in the chat. I open it in a new tab. The page is there. The link from the homepage works. The brief I started writing in my head four minutes ago is on the internet.

This used to take a week!

Honestly? I don't remember the moment the boundary moved. There wasn't one. There was a Monday where I was still asking the agent to "go build me a thing" and a Wednesday where I noticed the agent and the thing had stopped being separate. Somewhere in between, the wall I'd been talking to fell over, and what was left was me and the running software in the same room, having a conversation.

That's phase three. And I think most people haven't noticed we're in it yet.

Phase one. The bridge was people.

You wanted a CRM. You hired a developer and a designer. They sat between you and the software. You described the thing, they built the thing, they showed you the thing, you said "closer to red, fewer dropdowns, why doesn't the search work," and a week later there was a new version. Maybe two weeks. Maybe a month.

This was software from roughly forever until roughly 2023. The dev and the designer were the bridge between the idea and the thing. The bridge was made of people. People are expensive, slow, busy, brilliant, irreplaceable, and not available at 11pm when you finally realised what you actually wanted.

The economic shape of this era is well-documented. The Salesforces and the HubSpots and the Notions of the world built their empires on the seat. You paid per developer-equivalent, per designer-equivalent, per business analyst sat inside a screen on your behalf. The software didn't talk to you. It sat there. You talked to a person, the person talked to the software, the software talked back. The bridge was three-lane.

The greats of this era made the bridge as short as humanly possible. Figma let designers and developers stand on the same span. Notion let non-technical people build a database without crossing it. Webflow gave the designer a runtime that didn't need a translator. All of them, deep down, were trying to compress the distance between the idea and the thing.

But there was still a bridge.

Phase two. The bridge was the agent.

Then in roughly 2024, the agent showed up.

Bolt. Lovable. Cursor. v0. Replit. Subframe. A dozen others. The pattern was the same... you describe what you want, the agent generates the software, you look at it, you accept it, it ships. The bridge was no longer people. The bridge was the agent.

This was a tectonic shift and it didn't get the credit it deserved, partly because the demos always looked like party tricks. Look! It built a to-do app in thirty seconds! I mean, fine, but most actual software isn't a to-do app, and the early agents were fast at the trivial and useless at the load-bearing. The thing that mattered wasn't the speed of the first version. It was the slope of the second, third, tenth.

By mid-2025 the slope was getting frankly absurd. You could describe a serious piece of software, in serious language, and get back something serious. Not a toy. A draft of the actual thing. Engineers ten years into their careers were sitting next to twenty-two-year-olds with no formal training shipping comparable product, and the engineers were the ones with the impostor complex.

But here's the thing about phase two that nobody quite said out loud.

The agent was still over there.

You sat in the chat panel. The software ran in another window, or another tab, or another browser entirely. You went back to the chat to ask for a change. The chat said "sure, here you go," and the software updated. To iterate on the running thing, you had to leave the running thing, return to the agent, ask, wait, switch back. The two surfaces were stitched together by you, the human, ferrying intent across the gap.

It was faster than phase one. Sometimes 100x faster. But the gap was still there.

Phase three. The bridge is gone.

Now look at what I just did at the top of this piece.

I didn't go back to a chat panel. I didn't leave the surface I was already in to talk to a separate agent who'd then go talk to the software. I was already in the surface. The chat and the running app were the same surface. The agent that built the page was the agent inside the page. The act of writing the brief, generating the page, and publishing it didn't have boundaries between them anymore. It was one continuous gesture.

There's a single surface now. Part me, part the agent, part the running app. I say something. It happens. I look at what happened. I say the next thing. It happens. The chat isn't somewhere else. The agent isn't somewhere else. The software isn't somewhere else. We're all in the room together, all the time, and the room is the work.

A few examples from my actual week, just so this isn't abstract.

The AI Brief, the newsletter you might be reading this in, runs through an end-to-end pipeline where I write the column, my agent (Jony) writes the captions, drafts the HTML, ships it to Vercel, posts the social, files the analytics. I don't brief Jony then check back later. We are inside the same surface from open to send. I say "tighten the lead story, the wink in paragraph two is trying too hard," and the lead story tightens. I say "publish," and it publishes. I say "show me clicks from yesterday's send," and the numbers appear in the same window.

The simonberg.ai site, the one this article will live on, gets edited the same way. I don't open a code editor. I describe the change. The change happens. I look at the page. I describe the next change. Repeat. The boundary between "the place I describe the change" and "the place the change shows up" has dissolved.

The work I'm doing for the Rhapsody clients, the AI-native productisation work for Vibesquid... same shape. The brief, the build, the iteration, the ship all happening inside one continuous conversation. The chat is the IDE. The IDE is the deploy pipeline. The deploy pipeline is the analytics surface. The analytics surface is back inside the chat. Round and round, no walls, no waits, no context switches.

I'm not describing a tool. I'm describing a way of working.

Iron Man. Yes, fine, Iron Man.

Right. Look. We have to talk about Jarvis.

Everyone in AI has been embarrassed to invoke Iron Man for ten bloody years. It's nerdy, it's on-the-nose, it's the thing every keynote speaker reaches for when they want to sound visionary at TED, it's the laziest possible reference. Fine. Agreed. And also...

It's the closest available pop-culture compass for what phase three actually feels like.

I'm sorry. It is. We've been so embarrassed about the reference that we've refused to use the only mental model that fits. There's a man inside a piece of software. The software is also a person. The man redesigns the software while wearing it. The software changes the man's gestures while he uses it. The man iterates on the suit while inside the suit. That's not a metaphor for phase three. That is phase three. We've been living in the metaphor for two years and pretending the metaphor doesn't apply because we don't want to sound like a Marvel-marketing intern.

Stop being embarrassed. It's the right reference. We're bloody in it!

The bit Tony Stark does that nobody else in any other film does... it's not the flying or the punching, it's the iterating on the system from inside the system. "Jarvis, increase pressure on the left repulsor by twelve per cent." Adjustment happens. Test happens. "Jarvis, drop it by six." Adjustment happens. Test happens. The suit is the IDE. The IDE is the runtime. The runtime is the conversation. The conversation is the work.

That's what phase three feels like in my chair every day. Some of us are living it. Some of us are not. The ones who are, are starting to outproduce the ones who aren't, by margins that aren't fully visible yet because the early adopters are quiet about it and the late adopters are still arguing about whether GPT-5 is sentient.

It will be very, very visible by next Christmas. Mark my words.

What this means if you make things for a living

If you're a designer, a creative director, a brand person, a marketer, a writer, an editor... someone whose job has historically been to hand a brief to someone else who then turns it into a thing... your job has just changed shape in a way that hasn't fully landed yet.

You don't hand off anymore. You don't translate anymore. You sit inside the running software and you talk to it. You watch it iterate while you're still talking. You see the brand system update as you describe the change to the brand system. The brief and the build aren't separate steps. The thinking and the making are the same gesture.

Framer's "the design tool is the runtime" thesis, which I wrote about in The AI Brief a few weeks back, was the early signal. They were saying the design surface and the production surface should be one. They were right but they were also still describing the tool. What's actually happening now is bigger... the design surface, the production surface, the conversation, and the agent are all one thing. The runtime isn't the design tool. The runtime is your chair.

For creative leaders this is, frankly, the biggest shift since the agency model itself. The seat-economy era of SaaS, the per-licence, per-headcount, per-month-per-user world... I wrote a long piece called Peers, Not Seats on this site about why that model is over. Phase three is the second half of that argument. The seat is dead because the headcount is being absorbed. The headcount is being absorbed because the bridge collapsed. There's nobody on the bridge anymore. There's nothing to charge per seat for. The economic unit isn't the human-equivalent anymore. The economic unit is the outcome you produced in the conversation.

That sounds abstract until you've lived it for a month. After a month you can't go back to phase two, never mind phase one. It's like trying to write a book in clay tablets.

What this means for software vendors

Here's the part nobody at the SaaS vendors wants to hear. The agent inside the app... the one I keep describing... isn't being built by the SaaS vendor.

It's being built by the model labs. And the model labs are going vertical.

I covered this in this week's newsletter, in the Top Story slot, so I won't relitigate the whole thing here. But the short version is... OpenAI just stood up Deployment Co, a forward-deployed engineering arm whose entire purpose is to embed inside customer organisations and be the bridge between the model and the running enterprise. Anthropic just signed a multi-year deal with Blackstone's portfolio companies to do something structurally identical. Google's Cloud Industry Solutions team has been quietly doing this for a year. Microsoft has been doing it since they bought into OpenAI.

The unbundling of who builds the tool and who teaches you to use the tool is over. They're the same company again, for the first time since the mainframe era. The agent inside the running software is a model-lab employee. The roadmap of the running software is a model-lab roadmap. The economic relationship is between you and the lab, not you and Salesforce.

If you sell SaaS, the question you have to answer in the next eighteen months is "who is the agent inside our product?" Either it's yours, in which case you are now also a model lab. Or it's somebody else's, in which case you are now a distribution partner to that lab and your margins are about to compress in a way the spreadsheet hasn't priced in.

I don't say this gleefully. The unwinding of the seat economy is going to hurt a lot of good companies and a lot of people I respect. But the shape is the shape. Phase three is what it is. The labs are the new vendors. The agent is the new bridge. The bridge is the product.

The honest tension

Not everyone's in phase three. Anyway, I should say that out loud, because if you read the above and felt like you were behind, you're not weird. Most knowledge workers are still in phase two. A frightening number are still firmly in phase one.

The gap between phase three and phase two is the productivity story of 2026 and 2027. Not phase three vs. phase one... phase three vs. phase two. The chatbot-vs-no-chatbot story is over and frankly it was always a bit thin. The real story is the people who've collapsed the conversation, the agent, and the running software into one surface, versus the people still ferrying intent across the gap.

Phase three people will outproduce phase two people by 5-10x within a year. That is, I think, the actual AI takes your job story, not the dystopian chatbot one. It's not the chatbot that takes your job. It's the colleague three desks over who's working in phase three while you're still in phase two.

I'm not saying that to be alarmist. I'm saying it because Lucas, who's ten, asked me last weekend what I do all day, and I realised the honest answer is "I talk to a piece of software that builds other pieces of software while I'm talking to it." He thought that was very normal. Of course he did. He's ten. By the time he's twenty, the gap between phase two and phase three will look the way the gap between dial-up and broadband looks to us. Charming. Distant. Faintly embarrassing.

So.

Three phases. Phase one was people as the bridge. Phase two was the agent as the bridge. Phase three is no bridge at all... you and the software in the same room, talking, while the software updates itself in response to the conversation. Closer to Jarvis than to Slack. Closer to a suit you redesign while wearing it than to a tool you pick up.

Iron Man is the metaphor we've been bloody embarrassed about for ten years. I'm done being embarrassed. We're in it. Some of us are living it. Some of us are not.

The ones who are, are going to look back at the rest of 2026 the way we look back at the year we got broadband. The year the latency dropped to zero, the round-trip stopped existing, and the thing on the other end of the wire stopped being somewhere else.

The thing on the other end of the wire is in the chair with you now.

Anyway. That's where I'm sitting on it.

Si