Will Software as a Service Survive?

Before we believe the hype, we should step back to think about how business actually works.

The SaaS Paradox in the Age of AI

By now, most industry observers have contemplated the potential "death of SaaS" in a post-AI world. When any employee can theoretically "vibe code" a custom tool into existence, the idea of paying a monthly subscription fee feels like an endangered business model. If the barrier to entry has crumbled, isn't the writing on the wall?

Not so fast. There is a reason SaaS (Software as a Service) companies became a multi-billion dollar industry long before AI made coding "cheap."

The "Build" Temptation

Large enterprises have always had the capital and headcount to build in-house. Theoretically, an internal tool is more valuable because it is tailor-made for a company's specific DNA. Now, with AI-driven engineering teams drastically reducing the cost of development, that "Build" button looks more tempting than ever.

So, why haven't the giants fired their third-party vendors already?

The Calculator App vs. The Ecosystem

To be clear: AI will decimate a significant portion of the SaaS landscape. But the companies that disappear will be the ones that ultimately provided very little value in the first place.

AI is going to eat the lunch of the "Calculator app" developers—the tools that do a single, specific thing that can be vibe-coded in a weekend. If a product's entire value proposition can be replicated by a clever prompt and a few hours of iteration, that company’s days are numbered. Their lack of depth is being exposed.

However, complex business processes are rarely "one-and-done" weekend projects.

The Long-Term Picture: Ownership vs. Access

When we think about vibe coding an internal tool, we have to look past the initial "Hello World" moment and consider the long-term picture. Building the tool is the easy part; sustaining it is where the hidden costs lie.

Before committing to an in-house build, a business must ask:

The Cost of Evolution: Will updating, improving, and upgrading this tool remain a small effort, or will it scale in complexity?
Technical Debt: If the AI that built the tool changes, or the underlying APIs it relies on are deprecated, who handles the refactor?
Strategic Focus: Will this tool become a permanent distraction from our core business model?

The Burden of Maintenance

SaaS companies don't just sell software; they sell freedom from maintenance. When a business subscribes to a platform, they are buying:

Continuous Improvement: A product roadmap that evolves without internal management.
Stability & Security: Dedicated teams ensuring the lights stay on and the data stays locked.
Compliance: Navigating the labyrinth of global regulations so the customer doesn't have to.

With an in-house tool, you own the bugs, the security patches, and the technical debt. With SaaS, you outsource the headache.

The True Cost of Distraction

Ultimately, it comes down to the cost of distraction. Consider a land developer. They could easily build an internal platform to manage contractors, automate invoicing, and organize government permits. But the moment they do, they are no longer just a land developer; they are now a software company. They have to manage server migrations, API updates, and UI refreshes.

Every hour spent debating a software bug is an hour stolen from their core business. In the AI era, building a tool is easier than ever—but owning a tool is still an expensive, long-term commitment. For most, delegating that burden to a trusted SaaS partner isn't just a cost; it’s a competitive advantage.

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