The SaaS business model packaged workflow in a particular way — we now have to unbundle and rebundle these things and discover new business models, and the value creation opportunity in the agent world is 10x more.

Nadella argues that the old SaaS model of bundling data model, business logic, and UI into apps is being disrupted. Microsoft 365's Work IQ now exposes the M365 graph as a database for agents, creating vastly more value but requiring re-architected infrastructure and new business models beyond per-user subscriptions. ✦ AI generated

Satya Nadella · No Priors · 2026-06-04 · original ↗

We had a particular way we captured workflow in apps. Because we built a data model. We schematized some part of some business process. We then built a bunch of business logic, and then we put a bunch of UI on top of it. So that's kind of what every SaaS company did. For like 20 years, that was it. So interestingly enough, now you kind of get to re-litigate that vertical stacking. I still think the data model that you build underneath every SaaS application is super good. Like why reinvent it? Like my general ledger better be good. So I think the challenge of the SaaS business model is we packaged one way. We now have to learn how to unbundle these things and rebundle in new ways and discover new business models. If you look at it, what's happening today with Microsoft 365 is a great example. We have this thing called Work IQ. We've exposed what is perhaps the most important database in a company that never got used as a database because it was only captive to our apps. It was all e-mail operated on it, Teams operated on it, Word, Excel, PowerPoint, SharePoint. But now, this is one of the coolest things I get to do with Work IQ. I go to a GitHub repo and I say, hey, I attended a bunch of design meetings last week related to this repo. Can you capture all that and tell me what changes I should make? It literally can go look at all those transcripts, come back with a plan to change a code base. Previously, you could never have thought of using M365 for something like that. So the value creation opportunity now in the agent world is in fact 10X more. But it does require us to have, for example, there's going to be usage around M365, which is going to be perhaps more than even the end users. And we have to even re-architect. In fact, what I use to serve an inbox or a mailbox cannot be used to serve an agent.

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