The future looks bright for Software as a Service (SaaS), with analysts, vendors and service providers all looking ahead to healthy gains in the coming decade. Now if only those darned customers would get on board.
The latest Red Herring Software Report, for example, touts SaaS as "the hottest trend in enterprise software," and then offers a litany of reasons why enterprise executives are holding back. They're still tied to the traditional licensing mode. They're apprehensive about reliability and security. Many sectors still need a level of customization that SaaS can't offer. And some are even starting to wonder whether there really is a cost benefit over the long term.
Acceptance is really the last major stumbling block in SaaS's eventual takeover of the software market, according to David Linthicum blogging on Intelligent Enterprise. Even though a good number of IT managers say they could never trust software they do not own and host, the same attitude was prevalent in the early days of the Web. The needs of users, and customers, always win in the end.
Canada's ITBusiness.com quotes a number of vendors at the Mass Technology Leadership Council saying that a SaaS growth spike is on the way, even though most major clients have barely dipped their toes in the water. The general consensus is that once the major software vendors like Microsoft and Oracle devise a workable SaaS model that doesn't eat into license revenues too quickly, things should start hopping.
Microsoft, for one, continues to move in the SaaS direction with a new 12-month strategy designed to pitch services as an adjunct to traditional software, rather than a replacement. Most of the services will be presented under the "Live" brand, although it's not quite clear yet how the company plans to differentiate between the various Live versions of Office, Exchange and Sharepoint, or whether it feels the need to do so at all.
It seems that, on the record at least, most SaaS players have high hopes for the future. But too much fist-pumping can sometimes hide a certain apprehension. And sometimes, for one reason or another, good technologies simply don't catch on.