SaaS is Shaping Up

While 2009 has been an overall difficult year, software as a service (SaaS) is one industry that I think is developing very well, especially from my perspective as a promoter and firm believer in the benefits of SaaS and all components of cloud computing.

One example of the positive developments in SaaS this year is a recent blog post, “Four Factors Changing the SaaS Landscape,” by InformationWeek Editor Chris Murphy. The post is based on insights from a “future of software” panel of IT experts at the InformationWeek 500 conference.

From Chris Murphy’s post, the four factors changing the SaaS landscape are:

1. Board of directors support: even the board is on board with SaaS, according to panel experts working in enterprise IT. That’s a rather important consideration when presenting IT projects to the board for funding.
2. New product categories: SaaS vendors can quickly develop niche products that are not on the product roadmaps of large on-premises vendors.
3. Attitudes about “on premises” are changing to a point where on-premises systems will be considered legacy systems, like mainframes are today.
4. The recession helped SaaS because of lower initial capital requirements, quick implementation, and often less training.

One of the concerns expressed about point two above was integration of the various niche SaaS products and legacy systems; however, there are several integration companies, such as Pervasive Software, which provides standards-based bidirectional interfaces between any application, data source or technology.

Examples of niche SaaS products delivering business value include Mimiran, which focuses on pricing optimization, an important consideration for sales; and BranchIt, which provides a solution for enterprise relationship management: helping sales and other departments to leverage the business relationships within their companies.

In another post, “SaaS for Your Business in the Cloud,” Phil Wainewright documents the positive mood of sales professionals who moved from on-premises to SaaS companies.

Technology continually changes and improves; with SaaS, we’re now experiencing another example of change and improvement in software delivery, cost optimization, and business value.

Are the above points similar to the views about SaaS at your organization?