"Competition will heat up as AI-native challengers begin to chip away at market leaders across business processes and create new market segments that were previously unaddressed by software. In addition, new entrants are rapidly growing and disrupting the market with leaner operating models."
"Just as cloud-native vendors flooded the market a decade ago with Software-as-a-Service (SaaS) and Platform-as-a-Service (PaaS) offerings, we may see a glut of new AI-based applications. This trend means new interfaces, different cost considerations, and new ways of building and working with applications."
AI-native software providers are emerging as significant challengers to traditional SaaS companies, similar to how cloud-native vendors disrupted the market a decade ago. While the top 10 SaaS providers currently control over half the software market's capitalization and the overall market grew 11% to $4 trillion between 2024 and 2025, market dynamics are shifting rapidly. Traditional software companies face pressure to adopt results-driven pricing instead of per-license models. AI-native competitors are disrupting the market with leaner operating models and addressing previously unserved market segments. This transformation requires developers, engineers, designers, and product managers to reorganize their operations and develop new skillsets to adapt to AI-powered interfaces and business processes.
Read at ZDNET
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