I understand that AI poses a real threat to any service whose billing is based on user count. Even if a customer cannot build anything remotely comparable to their vendor’s system using AI, they can use AI to reduce their seat count—or at least avoid increasing it, even as their own business grows. Therefore, a SaaS company billing on a per-seat basis must introduce AI features into its service faster than its customers and competitors, while striving to make the customer more dependent on the service. This, in turn, boosts efficiency as well and reduces the customer’s need to purchase additional user licenses. A SaaS company must therefore compete against its customers on the utility of its AI features and, in order to avoid disrupting itself, simultaneously succeed in shifting its billing model from seat-based to value-based.
This is my take on the AI threat to SaaS companies; please correct me if I’m wrong.