I received an email message from a frustrated Software-as-a-Service (SaaS) company executive yesterday asking if I could publish a commentary clarifying the difference between cloud computing and SaaS.

His plea was prompted by a trade publication article which basically referred to cloud computing and SaaS as one and the same.

Anyone who has been intimately involved in the evolution of the SaaS or cloud computing worlds has a right to be frustrated by the blurring of the lines between the two concepts.

In my case, I view cloud computing as a broad array of web-based services aimed at allowing users to obtain a wide range of functional capabilities on a ‘pay-as-you-go’ basis that previously required tremendous hardware/software investments and professional skills to acquire. Cloud computing is the realization of the earlier ideals of utility computing without the technical complexities or complicated deployment worries. … Read More »

Despite growing customer adoption of Software-as-a-Service (SaaS), many companies and conservative industry observers still believe that SaaS solutions are simply a skinnied-down version of traditional, on-premise applications that offer little value add other than quicker deployment times and lower upfront costs.

IT/business decision-makers need look no further than at how today’s SaaS solutions are addressing age-old sales and marketing challenges to see that their capabilities go well beyond yesterday’s legacy software.

For instance, LucidEra announced a new offering today, called Lead Insight, which enables companies to analyize how marketing programs impact sales productivity. The LucidEra Lead Insight on-demand service offers over 65 prebuilt templates which enable users to analyze the quality and performance of their marketing leads and how effectively the sales team is converting these leads into opportunities and closed deals.

LucidEra’s new service enables companies to measure the cost effectiveness and … Read More »

I’ve just returned from my fourth trip to Las Vegas in four months where I spent three days attending my second annual Symantec Vision user conference and worldwide industry analyst briefing. The event offered a number of important insights regarding the state of the Software-as-a-Service (SaaS), as well as the managed services market.

I’ve stated in this blog numerous times, we are entering a pivotal new stage in the evolution of the SaaS market in which IT professionals are starting to view on-demand services as a powerful means of addressing many of their age-old management challenges, rather than a threat to their operations.

The Symantec executives who spoke at the conference and shared their candid views with me during the event confirmed my perspective by reporting that they are seeing rising receptivity toward SaaS ‘out-tasking’ alternatives to traditional management products among the … Read More »

As the Software-as-a-Service (SaaS) “gold-rush” intensifies, industry consolidation is inevitable. The latest example of this consolidation process is today’s announcement by NetSuite that it intends to acquire OpenAir.

This announcement not only reaffirms the SaaS industry consolidation trend, but it also is the latest example of a company profiled by THINKstrategies being acquired shortly thereafter. Other examples include,

Vtrenz which was acquired by Silverpop
Everdream was acquired by Dell
AimNet was acquired by Cognizant
Corio was acquired by IBM

(Contact me if you’d like a copy of our Strategic Thinking profiles on these companies.)

I had the privilege of talking with Zach Nelson, CEO of NetSuite, and Morris Panner, the CEO of OpenAir, moments before today’s announcement was made public. They indicated that the acquisition was based on a trend which THINKstrategies has seen coming for a few months now.

Prospective SaaS users are not only seeking … Read More »

THINKstrategies is pleased to announce the launch of its new “Market Leaders” webcast series which showcases companies who are delivering innovative, on-demand solutions to meet the rapidly changing needs of large-scale enterprises, as well as small- and mid-size businesses (SMBs).

Our webcasts differ from the traditional, structured webinar format by combining the candid, unscripted, conversational qualities of podcasts with the visual benefits of online presentations.As the producer and host of the Market Leaders webcast series, my goal is to provide a more interesting and engaging discussion with senior executives of companies who are in the forefront of the on-demand market. The webcasts will be pre-recorded, archived and 20-30 minutes in length so you can view them whenever fits your busy schedule.

In our first webcast, we examine how the rapid growth of the on-demand market has created new operating challenges for entrepreneurs … Read More »

Last month, Bruce Richardson of AMR Research published a provocative commentary entitled, “SaaS and the Elusive Path to Profitability” that heightened the debate regarding the financial viability of the Software-as-a-Service (SaaS) model.

Bruce’s column elaborated on a presentation he gave at SaaScon 2008 entitled, “Balancing Customer Acquisition Costs and Elusive Profitability.” The talk was driven by a question which Bruce claims to ask numerous software and service companies on a regular basis: “Do you know how much it costs to win a dollar of new business?”

Not surprisingly, Bruce has found that most SaaS companies are losing money acquiring new business in hopes of gaining long-term profitability over the life of the customer relationship. This has always been the logic behind the ‘land and expand’ tactics which are at the heart of almost every SaaS company’s go-to-market strategy.

In order to make his … Read More »

HP’s decision to acquire EDS cannot be faulted when measured against all the standard metrics for doing a mega-deal in the traditional technology world. It gives both companies greater scale and access to more corporate customers without a lot of overlap.

The problem is that we are in the midst of a fundamental change in the way customers acquire technology and the way they perceive their vendors. The HP/EDS combination doesn’t fit this new world order.

There is no question that EDS strengthens HP’s hand when it comes to building and managing complex enterprise data centers. The acquisition also gives EDS ready access to HP’s installed base of customers.

Wherever there are big systems integration and ongoing management projects to be won, HP/EDS will be in a better position to compete with IBM and the off-shoring companies than they were a day ago … Read More »

I’ve been telling people that the Software-as-a-Service (SaaS) movement will not only transform the software industry, but also dramatically impact the telecommunications and networking businesses as well. A recent company announcement which received limited press attention is another indication of the trend I see emerging.

Ribbit – calling itself “Silicon Valley’s first phone company” – announced earlier this week the general availability of Ribbit for Salesforce, the first enterprise application to link mobile voice communications and SaaS business workflow to allow users to configure their own communications services.

Ribbit’s new offering is being characterized as a ‘voice automation’ solution which accelerates the deployment of communications and integrates them with customer relationship management (CRM) capabilities via salesforce.com.

This solution promises to eliminate the complexities of communications deployment and management projects, and improve worker productivity by tying their communications devices into their CRM systems.

Ribbit for … Read More »

One of the benefits of being in the middle of the Software-as-a-Service (SaaS) market is getting exposed to a variety of interesting resources and research projects.

For instance, at last week’s Software 2008 conference in Las Vegas I was able to attend the kickoff presentation by Abhijit Dubey of McKinsey & Company which summarized the firm’s latest SaaS research regarding the evolution of on-demand platforms. Dubey and McKinsey have produced a series of research reports which have verified THINKstrategies’ SaaS survey studies regarding the accelerated adoption of SaaS. Even more importantly, their research clearly shows the total cost of ownership (TCO) and return on investment (ROI) advantages of SaaS for enterprise customers and on-demand platforms for software vendors.

THINKstrategies’ SaaS Showplace has also attracted plenty of attention as a resource for a variety of other research initiatives. For instance, THINKstrategies is … Read More »

As I’ve suggested multiple times, the major hardware and software vendors are aggressively pursuing the tremendous business opportunities in the managed services market.

Now, the key questions are how will they bring these offerings to market and what role will their channel partners play in provisioning these new services?

The two most recent examples are IBM’s new Express Advantage security-as-a-service offerings and Dell’s April 24 closing of its MessageOne acquisition.

IBM’s security-as-a-service solutions are its first on-demand offerings based on its acquisition of Internet Security Systems in August 2006. The new solutions will primarily serve small and midsize businesses (SMBs). They include Express Penetration Testing Services; Express PCI Assessments; Express Multi-Function Security Bundle, which includes protection against worms, spyware, anti-virus and spam in a unified threat management offering; and Express Managed Protection Services for Servers.

These solutions have been historically been offered as on-premises … Read More »