While Salesforce.com's Marc Benioff heralds software-as-service as "the end of software as we know it" and some customers cite a bevy of business benefits gained from their SaaS deployments, plenty of tech execs remain suspicious of software they don't own outright.
Opinions have certainly been mixed on the future of SaaS in government IT, which has an abundance of suspicious types. The CEO of SaaS provider RightNow in early 2007 said that government accounts made up 15 percent to 20 percent of his company's business in 2006 and seemed bullish on prospects for future growth in the sector.
Yet Input analyst Chris Dixon said in February 2007 interview with IT Business Edge that many government IT buyers would be reluctant to assume the perceived political risks of SaaS. He said:
It's politically more damaging when you put trust in another organization and it lets you down than when you can't manage it yourself. If you had it in-house, you could point to a specific reason it went wrong. The political dynamics will always make it different than a for-profit, private sector business.
Despite Dixon's cautionary tone, however, high-ranking federal IT official Karen Evans gave a big boost to the idea of SaaS in government IT with her remarks at the recent SaaS/GOV 2008 conference. As InfoWorld reports, Evans noted the government's shortcomings in delivering its own software on-time and on-budget and its poor record in project management. She said:
We can't continue to maintain all of the things we have. We have to start shutting down some of our legacy systems. We really have to move to a ... service-oriented market.
A Salesforce.com executive quoted in the InfoWorld piece said Evans' remarks might provide an impetus for government agencies to at least investigate using SaaS. The story also cites an agency, the U.S. Advisory Council on Historic Preservation, that has gained added flexibility in its information management systems by using SaaS.
Public agencies will likelier be happier with SaaS if their reasons for deploying it go beyond simple cost reduction. According to recent Yankee Group research, SaaS users cited cost as the third most popular driver for adoption, behind improved application quality and performance and faster time to value.