Tech giant Microsoft is creating a new engineering organisation: CoreAI – Platform and Tools. Led by former Meta VP Jay Parikh; the main purpose of the new division is to enable both Microsoft and external developers to build and run AI applications and agents.
This AI-first application stack will include:
- New UI/UX patterns
- Agent-based runtimes
- Agent orchestration capabilities
- Reimagined management and observability systems
Parikh’s CoreAI team will also include Microsoft’s Eric Boyd, Jason Taylor, Julia Liuson and Tim Bozarth.
Next up to Bat: Agentic AI
Microsoft sees 2025 as a pivotal year for artificial intelligence as agentic AI becomes more and more important for businesses, marking what Microsoft CEO Satya Nadella calls “the next innings of this AI platform shift.”
In his communication to employees, Nadella outlined a fundamental transformation of the software landscape:
2025 will be about model-forward applications that reshape all application categories. More so than any previous platform shift, every layer of the application stack will be impacted. It’s akin to GUI, internet servers, and cloud-native databases all being introduced into the app stack simultaneously.
Microsoft sees this stack introducing novel UI/UX patterns, specialised runtimes for agent construction and orchestration, and completely new approaches to management and observability. By the looks of it, they’re swinging for the fences!
The tech giant is positioning Azure to serve as the foundational infrastructure for this AI revolution, with plans to layer its developer ecosystem – including Azure AI Foundry, GitHub, and VS Code – on top. The strategy hints at a future where Microsoft’s various AI platforms and tools will converge to enable agent creation; potentially transforming every category of SaaS application.
Software-as-a-Service? Nope – Service-as-Software
Central to this vision is a shift toward what Microsoft terms “Service as Software,” where agent-based systems will drive the development of custom applications. This represents a significant departure from traditional software development approaches; suggesting that AI agents, rather than human developers, will handle much of the application building process.
Service as Software represents a fundamental shift from traditional SaaS models, where AI agents fully assume job functions rather than merely providing tools to assist human workers. The key distinction between SaaS and SaS is that, instead of purchasing software tools that need human operators, companies effectively “hire” AI agents that can run these applications autonomously, eliminating the need for human training, management, and oversight.
This approach promises to reduce operational costs, increase efficiency, and free human workers for more strategic tasks, while transforming the traditional model of software deployment and business operations.
Agent Provocateur: AI’s Bold Business Takeover
Microsoft – and other leading innovators – are clearly betting big on agentic AI in 2025. But how will this new evolution in the technology help businesses?
Well, in the near future, AI agents will take on entire business functions, from customer service to bookkeeping, operating software platforms like Salesforce and QuickBooks with minimal human oversight.
The impact could be transformative. Businesses will experience lower operational costs as they reduce staff training and turnover, 24/7 consistency in service delivery, and the ability to work seamlessly across multiple platforms.
Hopefully, agentic AI will free up human workers to focus on strategic thinking and relationship building while busting departmental silos.
Rather than just licensing software, businesses will effectively “hire” AI capabilities to run their operations. The future of work is looking increasingly automated – although at least these new hires won’t pinch your office snacks!
