Artificial intelligence could challenge the hourly pricing model used by audit, consulting, law and engineering firms, Egan-Jones Ratings Co. said, outlining potential effects on software, venture capital and U.S. housing.
The firm promoted its Oct. 1 commentary on Oct. 16 and said its credit analysts did not write it. Egan-Jones argues that AI could let compact teams handle work that once required larger practices, putting pressure on fees and senior professionals. Smaller firms using AI and clients seeking lower prices could benefit, while established firms and senior staff could face costs. The commentary gives no estimate for price cuts or job losses and does not say when the effects might occur.
The Financial Times reported that KPMG pressed Grant Thornton UK to pass on savings linked to AI. It said the audit fee fell to $357,000 for 2025 from $416,000 for 2024, a 14% decline in dollar terms. The account of the negotiations relied on unnamed sources. KPMG said it would not discuss confidential commercial arrangements, and Grant Thornton declined to comment.
Egan-Jones also sees a risk to software companies if customers use AI assistants to access services without relying as much on providers’ own interfaces. Anthropic introduced the Model Context Protocol in 2024 as an open standard for connecting AI applications with external data and tools. Egan-Jones argues those connections could make software companies’ interfaces less central and weaken their pricing power.
The firm says startups may be able to scale with less capital if AI handles tasks that venture funding would otherwise pay people to do. That could weigh on venture returns, it argues. “We suspect few limited partners have priced this in,” Egan-Jones wrote, referring to investors in private funds.
For housing, Egan-Jones links possible job losses among workers whose jobs are screen-based to short-term pressure on home prices. It cites a 1.6% annual increase in U.S. home prices in June 2026. S&P Dow Jones Indices reported a 1.5% annual rise in the S&P Cotality Case-Shiller U.S. National Home Price Index that month, while the U.S. Bureau of Labor Statistics (BLS) reported 3.5% consumer price inflation over the same 12 months. The index’s annual gain was below CPI inflation, a comparison based on those reported rates. The sources do not explain the difference between the 1.5% and 1.6% home-price figures.
FRED, a service of the Federal Reserve Bank of St. Louis, lists Oct. 27, 2026, as the next release date for the Case-Shiller index.
