From outsourcing to intelligence arbitrage

The service industry is entering a major shift: from selling labor hours to selling outcomes produced by intelligence.

The old model: labor arbitrage

Traditional outsourcing is based on moving work to lower-cost labor markets. It works, but it scales linearly: more demand means more people, more handoffs, and more quality-control overhead.

The new model: intelligence arbitrage

In a Lights Out factory, repetitive service workflows are executed by AI agents. Cost shifts from wages to tokens, which means a large share of work can be completed in minutes instead of hours. As token prices decline, margins increase, while customer pricing can stay stable through outcome-based contracts.

What customers actually buy

Customers do not buy staffing. They buy an outcome: a correctly processed invoice, a validated booking, or an updated CRM record. Delivery becomes clearer, measurable, and less dependent on individuals.

Why this is strategic

This is not just a technology upgrade. It is a new business logic where service firms can grow faster with higher quality, as long as they standardize specifications, quality gates, and exception handling.