Microsoft’s CEO believes that artificial intelligence will replace traditional business software. In an interview, Satya Nadella, CEO of Microsoft, announced a fundamental transformation in the future of enterprise technology. Speaking on the BG Squared podcast, he emphasized that traditional business applications will soon be replaced by AI agents.
Nadella stated that most enterprise software today merely serves as basic tools for creating, reading, updating, and deleting information, with some business logic layered on top. However, in the near future, this business logic will be managed directly by AI agents.
According to Nadella, with AI becoming central to business processes, there will no longer be a need for traditional backend systems. He described this shift as the “replacement of software with intelligent agents” — a change that could disrupt the dominant model of Software as a Service (SaaS) and establish Agent as a Service (AaaS) as the new standard.
In such a future, companies will no longer purchase fixed software packages but will instead rely on AI assistants capable of learning and adapting to their evolving business needs. Nadella views this change not as a gradual evolution, but as a “complete transformation” in how enterprise operations are developed and executed.
Microsoft has made substantial investments in artificial intelligence in recent years and is considered a leader in this shift. However, Nadella raised a key question in his remarks: Is the world ready to see AI not just as a tool — but as its new business partner?
