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SaaS: Disruptive, but Contained in Scope
SaaS and Cloud Computing has caused the world of software to dramatically change. ‘Disruptive’ is a description frequently used to describe its impact on the industry.
“SaaS is a disruptive force in the industry, and has caused people to think very differently.” — John Girard, CEO, Clickability.com, 2009
SaaS: IDC names as one of the nine vectors of IT Market “hyperdisruption” — IDC, 2007
“SaaS is not an optional disruptive technology.” — ComputerWorld Conference attendee, 2009
“Five major discontinuities are combining and will force IT organizations to change long-standing practices for procuring and managing IT… The five discontinuities include – Web 2.0, software as a service (SaaS)…” — Gartner, 2008
“SaaS as a disruptive technology occurs in software products that represent about 25% of total global software market, especially in customer relationship management, human resource management, IT management, and security software.” — Forrester, 2011
The last quote is a recent one from Forrester. In it, we see that Forrester says the effects of SaaS on some areas of the IT Market have been truly disruptive, but there are limits as to how far the sphere of SaaS influence can reach. While SaaS has become the main mode of deployment for software in areas such as e-purchasing, expense reporting, blogging and wiki platforms, there are limits as to how much SaaS can be applied. In reality, SaaS has only taken a lead, holding more than 50 percent of all revenues, in only 3 percent of all software product categories.
Forrester also notes that the SaaS model can’t easily be extended to some IT areas that include low-level stack elements, like the operating system and database; legacy, entrenched applications, and certain vertical applications. But despite this observation, Forrester says that SaaS is on a huge growth path now. Forrester expects SaaS to more than double from 7 percent of IT spend in 2010 to more than 16 percent of IT budgets by 2013.
