If businesses are rational agents that seek to maximize profit then yes you would expect agentic AI to eat SaaS. But this is not the world we live in. So much of business could be automated with 1990s technology. A model that predicts societal change should also be able to explain why this time it's different. Historical precedent says we should expect:

- modest incremental gains in productivity

- society will remain mostly the same

- very few people will take advantage of the opportunities unlocked by AI

"I think we can start to see a world already where demand from new customers for certain segments of tooling and apps begins to decline. That's a problem, and will cause an increase in the sales and marketing expenditure of these companies."

I think this sort of ignores the fact that S&M agentic tools exist and the cost of those services is also dramatically decreasing, so does it net out and just become a more efficient model in general?

for back office software, I'm actually getting more interest in building weird back office stuff than before, because people know what's possible now.

I'm not a consultant anymore but my friend who owns a dental clinic asked me if I could build them a personalized system that checks in with the staff every week; a thing that helps analyze how they feel week to week and helps my friend update her management strategy and coaches her on how to talk with her staff / helps her figure out her staff's communication strategies and what work they prefer to do; and she'd like me to run and host it so she can't see the raw data from her staff so they'll trust it more as it's run by a third party.

She could probably figure out how to do this but she'd still rather pay me like $5k to do this than spend 100+ hours figuring this out herself. Even with AI it'd probably take me at least a couple of weeks to get it working 100% as intended, and I don't have a dentist business to run.

I think we'll see more back office SaaS, becuase the problems to solve are near infinite, and no one has time to build all these themselves.

Saas is going to chipping away.

Agents offer a very attractive level of abstraction, and its customers, aren't necessarily human: it could be other agents. Many saas we have today would simply be unnecessary in the future.

If 90% of the actual work is waiting for Agent to get the work done, why would those companies keep paying those saas companies license fee per seat? It doesn't make sense.

Present day AI is a box that has these properties: a human has to create its inputs; a human has to verify its outputs; a human has to create the next input based on the last output. Extremely useful for sure, but this is not the kind of box you can use to scale a service delivered directly to end users who can't perform the activities labeled "human" in the sentence above.

> If anything, I think we'll see (another) splintering in the market. Companies with strong internal technical ability vs those that don't.

A tangent, I feel, again, unfortunately, the AI is going to divide society into people who can use the most powerful tools of AI vs those who will be only be using chatGPT at most (if at all).

I don't know why I keep worrying about these things. Is it pointless?

This is borderline schizophrenia. Firstly, nobody replaces something that works with something that might or might not work.

Secondly, the way this person describes "agents" is not rooted in reality:

>Agents don't leave. And with a well thought through AGENTS.md file, they can explain the codebase to anyone in the future.

>What's going to be difficult to predict is how quickly agents can move up the value chain. I'm assuming that agents can't manage complex database clusters - but I'm not sure that's going to be the case for much longer.

What in the world. And of course he's selling a course. This is the same business as those people sitting in Dubai selling $6000 options trading courses to anyone who believes their bullshit. The grifter economy around AI is in full swing like it was around blockchain/crypto in 2017-2020.

When you say agents, do you mean the workflow runners that can call APIs and automate the workflow steps?

Automation is not new. What's new is the capabilities of the models that can be assigned with some of the workflow steps. If these steps were served by SaaS companies so far, they will still serve it. Maybe they make it much cheaper and use a model themselves.

The ffmpeg wrapper use case is interesting. Reusing some core software for speed and reliability but to get better usability by leveraging LLMs seems like the sweet spot for SaaS use cases. A lot of these CRM products are basically wrappers around DBs and sheets like core products with terrible UI. The new breed will solve the UI ease of use issues.

My understanding is that agents are:

1) helping to saturate traditional SaaS because code is being commoditized / the effort to build is dropping significantly.

2) defining an adjacent sub-category of SaaS: "Service-as-a-Software" where the SaaS provides _outcomes_ instead of _tools_; this couldn't really exist at scale before recently.