Sticking with SaaS over AI—for now—is most realistic path, experts say

Do increases in AI capabilities spell the end of software-as-a-service?

That’s a question for IT pros who are struggling to figure out whether SaaS or AI works better for their tech stack, provided there’s room to cut one or the other. Those kinds of business decisions can be complicated; for many organizations, keeping both in the stack will likely continue for the foreseeable future.

AI solutions like vibe coding, which allow developers to develop internal custom solutions rather than relying on a third-party vendor’s software, have unsettled some of the traditional SaaS market. But, as COO at TieTechnology Mike Wehrs put it to IT Brew, vibing an app only works if it can reliably replace vendor software’s functionality.

“What’s the downside if this fails? If that entire vibe effort falls apart and doesn’t work, how bad is it going to be?” Wehrs asked. “If it’s really bad, it’s definitely shifting back to SaaS.”

Numbers game. While AI’s capabilities have increased, the technology’s potential is still far from fully realized. Studies like Cloudera and Wakefield Research’s the Great AI Re-Architecture survey, released in August, show that while there’s a hunger to deploy AI, it can run into problems in practice.

“[Ninety-five percent] of respondents said they have delayed or canceled projects in the last 12 months entirely due to data governance, compliance, or regulatory issues,” the report claims. “And more than half (55%) reported canceling or delaying more than six projects in that time.”

With 77% “actively using AI in some form,” it’s clear the issue isn’t a lack of enthusiasm, but rather knowing how to effectively integrate the technology into workflows. An analysis of data from Keyhole Software found that 92% of developers are using AI in coding on a daily basis, with nearly half of all new production code—41% to 46%—being AI generated.

Meanwhile, the SaaS industry continues to chug along. Projections from Statista indicate a growth rate year over year of 11.86%, with predicted revenue rising from $488 billion in 2026 to $855 billion in 2031.

Stuck in the middle. For organizations that rely heavily on SaaS, unwinding those products from the tech stack may lead to more problems than it solves.

Shafqat Islam, president at Optimizely, has a lot of experience choosing software vendors. He told IT Brew that solutions like Salesforce are the kind of SaaS technologies that aren’t worth the trouble trying to DIY; for example, vibe-coding a CRM requires an excessive amount of time and energy.

“Do I love it? No. Do I like using it? No. Are the screens great? No,” Islam said. “All of it is not great, but we’re never going to replace it because we’re not paying Salesforce or our HR software because the screens are nice—we’re paying for it because it’s totally connected to all the other systems. All our workflows go through it.”

With that level of institutional entrenchment, SaaS is here to stay for the foreseeable future—and hybrid-minded IT pros will continue to nibble around the edges of what’s possible to vibe code.