In today’s Cloud Wars Minute, I dive into the growing debate between SaaS and agentic AI, sparked by Satya Nadella’s December 2024 remarks suggesting that AI agents could spell the end of SaaS.
Highlights
00:32 — We’ve all been hearing a lot about SaaS dying — the demise of SaaS — triggered by AI, an opinion expressed in December of 2024 by Microsoft CEO Satya Nadella, who said that the rise of AI and agents is going to lead to the collapse of SaaS, the hollowing out of it, to become little more than a third-tier support product.
01:18 — Well, Marc Benioff said basically that this view, it’s just so much nonsense. And Benioff even went biblical. He said, we’ve got to be able to separate the wheat from the chaff, and we need to be able to determine what’s going on here with SaaS, what’s going on with AI, and what’s going on with agentic AI. How are they going to play together, along with Data Cloud and so on?
02:26 — And he said, that’s very much not the right question. He used some pretty tough language in explaining this. He said we’ve got thousands of customers who are very happily using Salesforce applications along with our Agentforce platform, to drive better business results. It’s very beneficial to believe both in the future of SaaS and the future of agentic AI.
04:02 — And on the earnings call, he went into detail about how many customers now are investing heavily in Agentforce. And the number of new business deals coming in — or repeat business — on agentic AI and Agentforce coming from existing customers. The Data Cloud that underpins this and Agentforce, he said, are now on a $1.2 billion run rate.
04:32 — I wish that there would be a point at which Satya Nadella could say, with the experience of nine months now of feedback in the market and from people he’s talked to: “Hey, I’m going to double down on what I said in December 2024.” Or he could say, “You know what, maybe I was a little too aggressive on that.” I’d love to hear that.
