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SaaS: Faster, Higher Quality, and, oh yeah, Cheaper
When people talk about SaaS, the discussion usually starts and focuses on the cost savings possible when deploying on-demand.
Those cost savings come from things like reduced in-house IT hardware and support costs, no upfront hefty licensing fees, no maintenance costs, and the ease of provisioning users.
But a report from Yankee Group says that as a decision factor, cost only comes in third place as being a driver for making the decision to go with SaaS. Ranking in front of cost comes improved application quality and performance and faster time to value, said George Hamilton, Yankee Group enterprise infrastructure research director.
That’s not to say that companies are wowed by only the benefits of SaaS. They still have lots of concerns.
Like how to integrate SaaS into their current infrastructure.
And by region, there are different sets of concern, with APAC countries being most concerned about stability and US countries concerned about security.
Another issue that comes up frequently with SaaS is the inability of companies to customize the application for a more perfect fit.
Most SaaS vendors are bending over backwards to make configuration easy, but customizations don’t mix well in the SaaS world.
Customizations reduce the SaaS advantage of economy of scale, making it more difficult for the SaaS vendor to track and keep running many copies and versions of the same base software. To counter requests for customization, many SaaS vendors are responding by providing training and advice to companies about the advantages of adopting best practicies and thus avoiding the need for customizations. While it make take time for customers to come around to this way of thinking, SaaS vendors are plugging the gaps quickly.
SaaS is fast becoming a thorn in the side of traditional software vendors.
SaaS has gained a lot of traction in 2007. It will be interesting to see how far SaaS will go in 2008.
