Why Your Traditional Dev Agency Is Terrified of AI (And They Should Be)

The "Billable Hour" Model Is Dead

If an agency charges by the hour, why would they use a tool that does the work in seconds? The agency model relies on junior developers doing slow work. AI destroys this value proposition.

The Conflict of Interest

Traditional shops have a fundamental conflict of interest. If they automate the code, they bill less. Their business model incentivizes inefficiency. The more complex and time-consuming the solution, the more revenue they generate.

This worked when software development was inherently slow. It does not work when AI can generate functional code in minutes.

The Numbers

A task that took a junior developer 4 hours now takes 10 minutes with AI assistance. If an agency bills $150/hour, that is $600 in old billing versus $25 in actual effort. Where does the difference go?

The Future of Software Services

The future is outcome-based pricing. You pay for the finished product, not the hours it took to type it. This aligns incentives: the provider is motivated to use the most efficient tools possible, and the client gets results faster and cheaper.

What to Look For

When evaluating agencies in 2026, ask:

• Do you bill by the hour or by the project?
• How do your developers use AI tools?
• Can you show me a project that was completed faster than traditional timelines?
• What is your stance on AI-assisted development?

We are not a "body shop." We are an efficiency shop. Our value is in what we deliver, not how long it takes us to deliver it.