Software-as-service has shaken up the software world by offering a pay-as-you-go subscription model. A newly emerging -- and perhaps even more revolutionary -- model requires companies to pay nothing at all.
Products such as Google Apps cost nothing, but ask their users to view online advertisements. In at least one area where Google copied Microsoft, rather than the other way around, Microsoft rolled out its Office Live services in both free, ad-supported and subscription-based versions. Google, on the other hand, didn't come out with a subscription-based version of Google Apps for nearly six months.
Most observers -- including us -- cited businesses' concerns over security and unwillingness to inundate users with ads as the two biggest barriers for adoption. Somewhat surprisingly, companies seem to be saying "no big whoop" and giving these free apps a try, according to a recent InformationWeek story.
We wonder if this isn't another case of consumerization creeping into the workplace. After all, some IT administrators may have concluded, folks are accustomed to seeing advertisements nearly everywhere in their daily life -- including pizza boxes and restroom stalls, in addition to more traditional outlets. Such users might find workplace ads routine rather than distracting.
Ad-funded applications are particularly popular among SMBs, who even more than big business counterparts are always looking for ways to shave software costs.
A sys admin at a consulting firm that uses ad-funded network management software from Spiceworks says he finds the ads unobtrusive and at least occasionally informative. A CIO quoted in Computerworld who replaced Microsoft's Outlook with Gmail agreed, saying ads did not distract and were sometimes "interesting."
And it isn't just SMBs that are experimenting with the free apps. According to InformationWeek, GE and Procter & Gamble (both typically portrayed as being on the cutting edge of IT) are currently testing Google Apps. A McKinsey & Co./Sand Hill Group survey found that fully a third of companies planned to use at least some ad-supported software over the next two years.