Have you noticed that some of the leading and publicly listed customer technology vendors have been having a bit of a torrid time on the stock market lately?
Indeed, many of them have been losing up to, and sometimes more than, 50% of their share price since the turn of the year.
What has happened (and is still happening) is that market investors, with the emergence of agentic workflow capabilities such as Anthropic's Claude Cowork, are losing confidence in the traditional Software-as-a-Service (SaaS) business models that technology vendors have relied on for the past two decades.
In the market’s mind, selling software licenses based on the number of employees using the app is less attractive than it once was, especially when you consider that if 10 human operators using AI agents can manage the workload previously handled by 100 people, say, then the enterprise customer suddenly doesn’t need another 90 software licences.
A Real SaaSpocalypse?
This whole phenomenon has been described as a “SaaSpocalypse”, a term coined by Jeffrey Favuzza, an Equity Trader at Jefferies, in a Bloomberg report, in early February 2026.
However, while the term emerged from financial markets, over recent months it has quickly become the shorthand for a structural crisis of confidence in the traditional SaaS business model across the broader business community.
Does that mean that these tools, and particularly those in the customer experience domain, are in terminal decline?
Not necessarily.
The problem is that we have seen these types of things before in recent years, and tech history is full of ‘extinction narratives’ where a new paradigm emerges, markets react, and analysts predict the complete collapse of established business models.
The reality is that, in almost every case, while the initial threat was real, the market response was often exaggerated because it overlooked how incumbents adapt and integrate new technology.
For instance, here are three prominent examples from the technology industry that share the same traits as the "SaaSpocalypse" thesis:
1. ‘Open-Source Software Will Replace Paid Software’ (Late 1990s–2000s)
Remember when, in the late 1990s and early 2000s, as Linux, Apache, and MySQL gained momentum, market observers argued that ‘free’ open-source software would destroy the business models of commercial software vendors?
At the time, Steve Ballmer, then CEO of Microsoft, famously called Linux a "cancer" on its business model, fearing that nobody would pay for operating systems or enterprise middleware if open-source alternatives were available for free.
2. ‘The Web is Dead / Apps Will Replace the Web’ (2010)
Remember when, in 2010, after the launch of the iPhone and iPad, Wired published an article claiming that "The Web is Dead" and predicted that closed, native mobile apps would render web browsers, URLs, and traditional websites obsolete, threatening companies built around the open web, such as Google.
3. ‘The Cloud Will Destroy On-Premises Enterprise Giants’ (Early 2010s)
Remember when, in the early 2010s, the emergence of Amazon Web Services (AWS) and pure-play cloud software took off, many on Wall Street declared legacy enterprise giants such as Microsoft, Adobe, and Oracle obsolete.
The narrative, at the time, was that no company would ever buy traditional software licenses or maintain on-premises databases again, and that agile cloud startups would wipe out the incumbents.
Despite all the hyperbole at the time, nothing happened as predicted.
Open source didn't replace paid software. Instead, it became the foundation of modern enterprise IT infrastructure when enterprise clients realized they were not just paying for the code itself, but for security, compliance, SLA guarantees, data governance, and support.
Native apps did explode in number, but the open web adapted and developed modern standards, such as HTML5, which enabled developers to build faster, more accessible, and more interactive web experiences as well as browsers powerful enough to run desktop-grade applications.