Cloudflare CEO: AI agents are a 'bane' for some website operators

Cloudflare CEO Matthew Prince said on the company's third quarter earnings call that some customers view AI agents as a "bane" to their business and want to keep them away. He argued that agentic browsing can impose costs on websites that do not benefit from the traffic, and he warned that containers may struggle to keep pace with expected bot-heavy workloads.

Agent traffic and website costs

Prince gave an example: an agent might scour 1,000 restaurant websites and pull 1,000 menus, while the user chooses only one. In that case, 999 restaurants bear a cost without receiving a benefit. He said web searches have always created some low-value traffic, but the volume of agentic activity is at a different scale. Cloudflare has previously predicted agentic activity will be one thousand times greater than clicks from humans.

Containers and Cloudflare products

Prince said containers are a significant improvement over bare metal or virtual machines and fueled growth of hyperscale clouds and mobile applications. But he argued that the container-based architecture of hyperscalers and neoclouds cannot keep up in a cost-effective way with new agentic paradigms. He pitched Cloudflare's serverless Workers service as an alternative to containers. The company also offers products that can block agents, ameliorate cost and traffic impacts, or allow organizations to monetize traffic generated by AI. Prince said demand for those products is growing fast, and since July 1 approximately five percent of the web opted in to Cloudflare's content protection products. He said Meta is already a customer, and said its "Muse" agents will benefit Cloudflare by creating more agentic traffic that third parties want to tame.

Security, revenue and market reaction

Prince said vulnerabilities like the PHP vulnerabilities disclosed recently had been in the wild for years, and that Cloudflare is reviewing logs for evidence that hackers or nation-state actors used them before disclosure. He said security vulnerabilities reported in recent weeks may not be over, and that Cloudflare is among the first to receive quiet disclosure of new vulnerabilities and remediates them before disclosure. Cloudflare reported year-on-year revenue growth of 39 percent, with quarterly revenue reaching a record $782.5 million. Investors sent Cloudflare shares up by around 15 percent in after-hours trading, after major US indices dropped around four percent earlier.

Sources: The Register