Agentic AI: Disrupting SaaS or a Race to the Bottom?

Agentic AI is redefining the software landscape. The ability to spin up autonomous AI agents is becoming easier by the day - often delivered to customers via low-cost SaaS subscriptions that make enterprise entry barriers minimal. This democratization forces startups to chase high volumes, while enterprises enjoy a no-strings-attached approach to AI innovation. But with such low cost of entry and an abundance of solutions in the market, the churn rate is likely to soar.

This rapid influx of agentic AI solutions raises critical strategic questions. With minimal commitment required to adopt these tools, how do providers secure long-term loyalty and revenue? Is a land-and-expand strategy the answer, or are we witnessing a race to the bottom where transient subscriptions and an ocean of options eclipse sustainable value for the current wave of agentic solutions?

For enterprises, where should they draw the line, when the line is low cost disruption vs high-stakes integration?

Looking ahead, as agentic AI and low-cost SaaS strategies combine (ASaaS or AgSaaS?) lower entry barriers and potentially drive high churn, a critical question emerges: Will agentic AI remain stuck further down the value chain while mission-critical solutions - such as payroll, HR, accounting, analytics, and supply chain management - continue to dominate? These robust solutions command premium pricing thanks to their specialized expertise, rigorous compliance, and data security, creating a durable moat that low-cost agentic AI tools may struggle to penetrate.

Just as simple, task-oriented AI training eventually evolved into expert-level, high-value solutions, agentic AI may have to move upstream to secure its long-term success. Ultimately, can agentic / SaaS providers transition from a volume-driven model to one that consistently delivers high-impact, sustainable value, or is the agentic wave destined to remain confined to the lower end of the market as a point solution?