Josh Miller, writing in The Browser Company’s substack:
After a couple of years of building and shipping Arc, we started running into something we called the “novelty tax” problem. A lot of people loved Arc — if you’re here you might just be one of them — and we’d benefitted from consistent, organic growth since basically Day One. But for most people, Arc was simply too different, with too many new things to learn, for too little reward.
“Novelty tax” is another way of saying using non-standard patterns that users just didn’t get. I love Arc. It’s my daily driver. But, Miller is right that it does have a steep learning curve. So there is a natural ceiling to their market.
Miller’s conclusion is where things get really interesting:
Let me be even more clear: traditional browsers, as we know them, will die. Much in the same way that search engines and IDEs are being reimagined [by AI-first products like Perplexity and Cursor]. That doesn’t mean we’ll stop searching or coding. It just means the environments we do it in will look very different, in a way that makes traditional browsers, search engines, and IDEs feel like candles — however thoughtfully crafted. We’re getting out of the candle business. You should too.
“You should too.”
And finally, to bring it back to the novelty tax:
New interfaces start from familiar ones. In this new world, two opposing forces are simultaneously true. How we all use computers is changing much faster (due to AI) than most people acknowledge. Yet at the same time, we’re much farther from completely abandoning our old ways than AI insiders give credit for. Cursor proved this thesis in the coding space: the breakthrough AI app of the past year was an (old) IDE — designed to be AI-native. OpenAI confirmed this theory when they bought Windsurf (another AI IDE), despite having Codex working quietly in the background. We believe AI browsers are next.
Sad to see Arc’s slow death, but excited to try Dia soon.

Letter to Arc members 2025
On Arc, its future, and the arrival of AI browsers — a moment to answer the largest questions you've asked us this past year.