Over on Rough Type there is an interesting post about the misunderstanding around what SaaS really is. I posted this as a comment on the site, but thought I would expand it a bit here …

My glib answer to the question is:Take a look at any software package that has salespeople who come on site and requires an organization to have dedicated hardware, software, and personnel in order to function.

HINT: If the software is coded in Java or C++ and requires more than 1 hour and a single intern to deploy then you are on the right track.

Now, think about how the CEO and CFO of that organization wishes that software actually worked and how much it actually cost. If the disconnect is more than 25% of the sticker price or 50% of the functionality then the definition of SaaS is:

a. The combination of back-end processes, front-end display, and data access methods that provide the functionality.

b. An equivalent cultural shift as the move from main- and mid-frames to PC’s in the 1980’s.

c. What that organization will be switching to in the next three years.

I believe that the shift to SaaS will be as large, swift, and ruthless over the next few years, and it will have a sweeping impact on the software industry as we know it. The people I worry about most are the VAR’s, especially those who exist the Windows ecosystem or have any application that requires a complied GUI. The economics are just slipping away from them …

This entry was posted on Thursday, November 30th, 2006 at 9:14 am and is filed under Systems Integration, Over the Horizon, SaaS. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.