When I wrote about software-as-a-service back in March, I shared the concerns of some analysts that adoption could stall unless vendors made more of a concerted effort to woo new customers, including stepping up education efforts and recruiting channel partners.
Vendors, including giants like Microsoft and Oracle, now appear hip to this, leading AMI-Partners to predict a compound annual growth rate of 20 percent for SaaS and managed services among SMBs over the next five years. The market will top $1.6 billion this year, forecasts AMI-Partners, reports eChannelLine.
Says Ryan Brock, vice president of channels at AMI-Partners:
... the vendors themselves have finally got really serious about it. Companies like Microsoft and Oracle and IBM, they've all realized this was sort of the writing on the wall, that this one day was going to be a significant, if not the, means that software was delivered.
Resellers also appear to be getting over their initial reticence toward SaaS, says Brock. Four in 10 such companies with an emphasis on SMB business offer some sort of managed service, a number that AMI-Partners expects to grow as vendors step up efforts to partner with them.
Software will follow a path similar to hardware, in which services become more important to resellers' business models as margins on the product itself shrink. It will, however, take some time for vendors and their partners to identify optimal pricing models. Says Brock:
It's going to take some time to figure out where that's all going to fall.