Alphabet chief executive Sundar Pichai told investors on the company’s earnings call that Google’s Gemini model is being used to “empower” — rather than replace — enterprise software vendors. Asked directly how AI might affect the large market for software-as-a-service (SaaS), Pichai said many leading SaaS customers are embedding Gemini deeply into critical workflows to enhance product experience, accelerate growth and improve internal operations.
His comments came amid heightened investor anxiety about AI’s disruptive potential for established software business models. Pichai framed Gemini as an enabling layer comparable to search and YouTube: a platform capability that, when integrated thoughtfully, can expand the addressable market and create new routes to value for incumbents and startups alike.
The remark is both a reassurance to Alphabet’s SaaS partners and a subtle reminder of Google’s leverage as a platform provider. Embedding a large, multimodal model like Gemini into third‑party applications can raise productivity for end users while deepening their dependence on Google’s APIs, clouds and data plumbing — a dynamic that carries upside for developers but also concentration risks for the broader ecosystem.
For SaaS vendors the near‑term picture is binary: firms that exploit Gemini to make their products materially smarter and stickier can accelerate retention and monetisation, while those that merely bolt on AI will face commoditisation pressure. The integration challenge is technical and strategic: vendors must manage prompt engineering, latency and cost of inference, plus governance around proprietary data and compliance with customer privacy requirements.
Beyond company‑level implications, Pichai’s message matters to investors and regulators. Equity markets have already punished some software names on fears that foundation models will commoditise higher‑margin enterprise features. At the same time, platform owners’ rising cloud and AI investments — and the commercial terms under which they expose models to partners — will shape whether the AI era looks like a renaissance of specialised SaaS or a consolidation around a few model providers.