I've seen it argued that the Smith virus is inevitable in every Matrix version since Smith is the result of the equation balancing itself out against the One, and since Neo would always choose to destroy Agent Smith the same way he did at the end of M1. The argument continues by saying Smith is always stopped when the One chooses the right door, and machines simply didn't know how dangerous Smith becomes when given enough time to fully develop.
This does not reconcile with the following conversation, which takes place right after Neo routinely kills some Agents:
Smith 1: “That went as expected.”
Smith 2: “Yes.”
Smith 1: “It’s happening exactly as before.”
Smith 2: “Well, not exactly."
The Smiths have this conversation with each other before they know Neo will choose the left door. Therefore, the thing that is "different" this time has absolutely nothing to do with Neo's choice for the left door.
Some have argued that the Smith 1 / Smith 2 conversation above refers to Neo's fight with Smith at the hotel, referring to the killing of agents as the thing that has happened "before." But Smith doesn't even join in on the fight this time, so we can hardly say it took place “exactly as before.” If this dialogue had referred to a mere brawl, it would have been more appropriate for it to take place just after Smith fought Neo himself. Furthermore, Neo noticed the agents were "upgrades," and was therefore unable to destroy them in the same way he did Smith - all he could do was block their punches and throw them around the room. That fight did not go anything like the one before, where he literally exploded Smith from the inside.
When Smith says, "It's happening exactly as before," the word "it" refers to "the development of the One." He sees Neo growing more and more powerful, just like before, but now something is different this time: Smith is duplicating.
Perhaps the biggest nail in the coffin is the conversation between Neo and the Architect, in which the Architect makes it abundantly clear numerous times that human rejection / choice / irrationality is what causes the Matrix to crash, not the Smith virus.
Architect: "As you are undoubtedly gathering, the anomaly is systemic - creating fluctuations in even the most simplistic equations."
Neo: "Choice. The problem is choice."
Smith is not the problem that will destroy the Matrix, irrational human choice is. Irrationality is what causes errors in the system, and over the course of decades, these errors start compounding, leading to things like what we see in Beyond. You also have people whose irrationality causes some form of rejection of the Matrix, as with potentials and Dan in World Record.
Architect: "The first Matrix I designed was quite naturally perfect, it was a work of art - flawless, sublime. A triumph equalled only by its monumental failure. The inevitability of its doom is apparent to me now as a consequence of the imperfection inherent in every human being."
Did Smith crash this first sublime version of the Matrix? He couldn't have, because Agents only exist to battle anomaly, and in the Architect's version, humans were not given "choice" to accept the simulation or not. Instead of "anomalies" there would have been full-blown errors that would have possibly crashed the system in days, hours or even minutes (which is why the Architect calls the failure "monumental."
Architect: "...she [the Oracle] stumbled upon a solution whereby nearly 99% of all test subjects accepted the program, as long as they were given a choice, even if they were only aware of the choice at a near unconscious level. While this answer functioned, it was obviously fundamentally flawed, thus creating the otherwise contradictory systemic anomaly, that if left unchecked might threaten the system itself."
One might think at first that the contradictory systemic anomaly is Smith, but it's not. The last sentence of this quote tells us that the system is actually threatened by the "systemic anomaly". This refers to the accumulation of "fluctuations" (errors) that redpills and missing bluepills produce, which begin to threaten the system if the rejections are not eventually cancelled out with the One's single counter-choice.
Architect: “Ergo those that refused the program, while a minority, if unchecked, would constitute an escalating probablility of disaster.”
Neo: “This is about Zion.”
Those that refused the program are the ones that destroy the Matrix “if left unchecked.” It’s about Zion. It’s not about Smith! In fact, by stark contrast, Agent Smith embraced the program – he didn’t refuse it. Smith is the poster child for embracing purpose within the system.
The fact that this is the first time the Smith virus was created also makes the ending of the third movie more powerful. Smith doesn't just threaten the Matrix, he threatens Machine world too, and possibly even all of Earth or even the whole universe. As the Oracle says in M3, "Very soon he's [Smith] going to have the power to destroy this world, but I believe he won't stop there; he can't. He won't stop until there's nothing left at all." By the time Smith is fighting Neo, he has practically won, and at that point, Machines must be aware that Smith poses a threat to all of existence of man and machine life. This unexpected turn of events is why Neo's bargain is accepted. Had Smith only been a threat limited to the Matrix itself, Deus Ex Machina probably wouldn't have accepted Neo's proposal, because as the Architect pointed out in M2, "There are levels of survival we are prepared to accept" (i.e. if Neo chooses the wrong door). If the Architect had any way of knowing just how much of a threat Smith was, he couldn't have made this statement.
But instead, we have that the Architect managed to deliver a very long speech without mentioning Smith even once, and this is because he is either unaware of the magnitude of this new threat, or it is a moot threat at this point since those who reject the Matrix will crash the system anyway. The Smith virus is one of the Oracle's baked noodles - see Oracle: Baking Noodles.
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