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History doesn’t repeat itself, but it sure rhymes

Stop defending the old model and aggressively build the new one.

Author

Malcolm Frank, CEO
June 22, 2026

History doesn’t repeat itself, but it sure rhymes

Some 25 years ago, firms like EDS and CSC were the royalty of tech services. Then the Internet scaled and these firms cratered.

Is it happening again with today’s GSIs? Last week was a bloodbath: ACN -23%, GLOB -16%, CTSH -15%, EPAM -13%, INFY -10%. The last time Accenture traded at these levels was 2017. Cognizant? 2013.  (For just those two firms alone, I think of the 1+ million combined employees working their tails off for years…to create zero value.)

In looking at the chart below, today’s GSIs are hemorrhaging value in a pattern very similar to EDS and CSC back in the day. The key question: Will GSIs bend the curve, or follow the same path?

Here's the issue. Just as in the Internet era, we're collectively confused about where to focus with AI in tech services. There's endless talk about what to deliver (new use cases and so on), the new skills (HTML then, FDEs now) and pricing (T&M, outcome-based, and everything between). A generation ago we went round and round on exactly these questions…and it all ended in tears.

Ultimately, only one thing mattered: raw cost. The Internet enabled global delivery, and that cut the economic legs out from under the EDS/CSC model. Logic (and rapidly mounting evidence) says the same is happening now with AI, only faster and at a far greater scale.

Large-scale tech services firms aren’t built for Moore’s Law. The price elasticity and supply chain nimbleness enjoyed by product firms don’t apply here.

Thus, the uncomfortable truth: EDS and CSC didn't lose because they were badly run.  They lost because they were on the wrong side of a cost curve that only bent one way.

The firms that survived (and thrived!) after the last reckoning were the ones that stopped defending the old model and aggressively built the new one. So for GSIs that means no more offsites at four-star resorts.  No more sports sponsorships. No more endless LI posts on internal meetings (“Look, we’re eating a nice dinner!”). And getting back into the garage with an existential intensity.

History rhymes.

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