A mental model for reasoning about how agents will impact the marketplace business model Marketplaces do four jobs for customers: 1. They help them search 2. They allow them to transact 3. The commoditize trust 4. They handle fulfillment Google can only do search. That meant they could really only fully eat the profit pools of industries that don't need steps 2-4 because they transact offline. e.g. restaurant reservations and local services But agents are not only better at search, they can also transact. That means they are going to eat the profit pool of industries that don't require steps 3-4. e.g. in hotels, the big brands are the trust layer not the marketplace, and customers travel to them so there is no fulfillment But most industries are not like this. They still need marketplaces to aggregate fragmented supply, backstop trust, and hand the messy last mile That is why Amazon, DoorDash, Uber, and most other big marketplaces will be much more resilient to agents Agents are probably going to work, but they are going to need to strike deals with marketplaces that mostly preserve their economics. Because in the end they have the most leverage: the product needs to actually get to your house.