Will AI operating systems make traditional apps obsolete?
What's the story
Tech giants like Meta and OpenAI are racing to create "operating systems" for AI-powered devices. The trend is expected to gain momentum in 2026. These systems are designed with the vision of having AI agents perform tasks on behalf of users without them having to access an app or website. This could change the way consumers interact with technology and potentially disrupt business models for many consumer tech companies.
Market impact
AI devices: A shift in consumer tech
The promise of AI devices is that users could simply ask for a desired outcome and get it. An AI assistant could book travel, order lunch, or even restock supplies. However, this could also disrupt the business model of many consumer tech companies. For instance, companies like Uber and DoorDash have relied on keeping consumers within their apps to serve ads, upsell other services and build loyalty.
Business disruption
AI agents could disrupt app-based businesses
AI agents could simplify many of these businesses to their core services, reducing the need for users to visit their apps. This could mean that even if a user pays the same price for a DoorDash delivery through AI glasses, the company might miss out on upselling other services later. Anjney Midha, an investor at Sesame—a start-up building AI devices—says companies without "deep control over the supply of their product" will find it hard to operate in this new world.
Developer platform
The challenge of creating a successful operating system
A successful operating system requires a thriving developer platform. Companies have to incentivize developers to build apps for their platforms. However, some tech companies are wary of letting AI agents from smaller start-ups mediate their relationship with users. Rabbit, the start-up behind the failed R1 device that debuted at CES 2024, faced this issue when major app developers like Uber were reluctant to partner with them early on.
Industry response
Legal battles and partnerships in AI app development
Perplexity also faced similar challenges with its shopping agent. Amazon sued the company over an agent that could buy products on behalf of users. However, many app developers are willing to work with larger platforms. Companies like DoorDash, Instacart, and Expedia have signed up to build early forms of AI apps within ChatGPT while Ticketmaster, Uber, and OpenTable debuted as early agentic features for Alexa+.
Uncertain future
The future of AI app ecosystem remains uncertain
Despite these developments, the ChatGPT apps are still in their early stages and not many people are using the chatbot to buy products. In September, the company revealed that only 2.1% of users were looking for information about purchasing products via ChatGPT. Midha believes it's too early to predict how the AI app ecosystem will evolve as tech companies are still figuring out how to monetize their platforms effectively.