---
id: "prereq-saas-model"
type: "prerequisite"
source_timestamps: ["§ Service as Software"]
tags: ["business-models", "software"]
related: ["concept-service-as-software"]
reason: "Necessary to comprehend the baseline from which the enterprise software market is evolving."
sources: ["futures"]
sourceVaultSlug: "hbr-seg-futures"
originDay: 2
articleStem: "hbr-nm-99-genai-end-incumbent-advantage"
sourceUrl: "https://hbr.org/2024/11/could-gen-ai-end-incumbent-firms-competitive-advantage"
sourceTitle: "Could Gen AI End Incumbent Firms’ Competitive Advantage?"
---
# Software as a Service (SaaS) Economics

**Prerequisite.** The essay assumes the reader understands how **SaaS** revolutionized the enterprise IT stack — moving from bulky, on-premise installations to scalable, cloud-based subscriptions.

**Why it matters here.** This context is necessary to grasp the magnitude of the predicted shift to [[concept-service-as-software|Service as Software]]: the fusion of the ~$250B enterprise-software market with the ~$5T+ white-collar labor market. Without knowing the SaaS baseline, the leap from *tools-for-humans* to *AI-workers-that-do-the-work* is hard to size.