In a recent interview just before we broke for Christmas, Satya Nadella, CEO of Microsoft outlined a bold yet controversial vision for the future of business applications in a world dominated by AI.
According to him, the era of SaaS as we know it is coming to an end, giving way to integrated platforms where AI becomes the central driver. This transformation is poised to disrupt traditional tools and workflows, paving the way for a new generation of applications.
For decades, SaaS applications have been indispensable in powering business operations — CRM, HR, ERP systems, project management tools, and collaborative workspaces have all built their dominance on one fundamental premise: they’re essentially CRUD (Create, Read, Update, Delete) databases with business logic layered on top.
But in the AI era, Nadella envisions that this business logic will migrate to an AI layer, disrupting the role of traditional SaaS apps.
“The business logic is all going to these AI agents. They’re not going to discriminate between what the backend is — they’ll update multiple databases, and all the logic will be in the AI tier.”
This means that AI agents, as intelligent orchestrators, will integrate seamlessly across multiple SaaS platforms, effectively reducing these apps to their barebones function as databases.
The “intelligence” part of these systems — the workflows, decision-making, and automation — will shift to the AI agents, collapsing the individual value proposition of isolated SaaS tools.
In this agent-driven era, AI becomes the “brain” of business systems, with SaaS tools evolving into specialized enablers rather than standalone solutions.
This is a very interesting vision to take us into 2025, which has profound considerations for Designers, Architects and Developers to mull over.
Do you agree with him that the era of SaaS is over?