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8 Myths of Software-as-a-Service
abb_road writes "BusinessWeek looks at the current state of software-as-a-service, arguing that the model is well established and is distinct from failed ASP/Hosting models of the dot-com era. Far from a passing fad, the model is starting to see large-scale adoption, and traditional vendors are having trouble revamping their applications and financials to get in on the action. From the article, 'As SaaS gains mainstream acceptance, it is becoming an important disruptive force in the software industry. And as long as the quality and reliability of SaaS solutions continues to improve, the appeal of SaaS isn't going to go away.'"
they have had disservices for a long time... just look at windows. it's a huge disservice.
Anons need not reply. Questions end with a question mark.
To condense the article down: SaaS is a fancy term for outsourced business operations. The only difference is that companies provide communications about these services through... (wait for it)
...
(wait for it)
(keep waiting)
the INTERNET!
Are you impressed yet? It's very Web 2.0, I'm sure. Some of them might even use AJAX and Social Networking and Portal Technology and Peer to Peer Business to Customer relationships and
Javascript + Nintendo DSi = DSiCade
"Software as a service" is almost as old as the public internet. Many banks, hospitals and government institutions have been running remotely hosted mainframe apps for over 2 decades ... it's quite proven successful business model.
If you look at the fact that no code is ever flawless, and always has bugs, so there's always patches and upgrades. Most people in the regular software industry are passing off intermediate versions of flawed software as a product, and then giving the service away for free. This is just the opposite of that model and it makes more sense. Continuing to support, and making bug fixes to past versions of software is part of the service, clients have a real voice in the future of the software package by communicating what their future needs are. As they pay per period versus per version, software development companies don't have to guess anymore what their clients want to get them to "buy the new version" instead, the clients can have a real voice in what features are important to them in the future, without the need for pushing stuff off to a higher version versus an incremental update. It's a better model because instead of selling "why you have to ditch this old one and buy this new one" you are instead saying, "we have an established relationship in the past, and if you enjoy this, we can continue." Resulting in less useless bells and whistles in new versions, and more of the actual needed functionality. Instead of inventing things you dream they will want, you take care of their changing needs instead. That's why I think it's a winning model (if companies followed it correctly).
Judges and senates have been bought for gold; Esteem and love were never to be sold.
This message brought to you by Salesforce.com This article reads like a press release from Salesforce.com, the biggest player in the "software as a service" marketspace. I tried Salesforce when I started my VoIP business; if they're the market leader, this industry is too immature to be taken seriously.
First off, it isn't cheap--Salesforce.com is $65 per month, per seat and it has to be paid 3 months in advance. This makes it quite a bit more expensive for small businesses than say Goldmine or ACT. Secondly, the reliability was horrible. CRM is the lifeblood of any organization. *Any* downtime results in all of your customer facing people (sales team, customer support staff, billing, etc) basically sitting around on their hands. Sales leads were lost and customers were pissed off. The worst part about it is that we couldn't do anything about it. I couldn't reboot a server, rebuild table indexes, sacrifice an intern... nothing. I wasn't told what the problem was when the system came back up, nor was I even notified *when* they came back online. And I wasn't given an apology or a service credit.
After several very public blackeyes Salesforce finally released a systems status page. In a pure act of corporate hubris they named it http://trust.salesforce.com/. You know know something's deeply wrong when a simple status screen is given that hard of a PR spin. Sorry, but they already blew my trust. I don't care what BusinessWeek says, I wholeheartly recommend that an organization keep their key systems in-house!
Entrepreneur : (noun), French for "unemployed"
...is apparently now writing for Business Week.
Absolute Michigan
This is crap. It's not even well-written crap, which makes it pure bullshit. There's more nonsense "terminology" in this article than I've seen in a long time. The belief that the "legacy applications" are the reason that the dot-com boom failed is unjustified. Business don't fail because of software, good, bad, or indifferent. And they're sure as hell not going to succeed because of it, either. From the article, "Now Oracle, Microsoft (MSFT), and SAP (SAP) must respond to the SaaS movement while trying to avoid cannibalizing their existing software business in the process." This is a bald-faced attempt at spreading fear, uncertainty, and doubt. Microsoft produces the operating system that most home/business clients use, and Oracle produces one of the most common commercial databases, both of which are staple products, and are required for this "software-as-a-service" to function. They won't be "cannibalizing their existing software business[es]" any time soon. So, I feel it is necessary to add another "myth" to this page: Myth #9: This article is a reliable source of information
Software as a service is great if you have some way to export your data. My company has (not my choice) bought into an online ERP system which looks good from afar, but is apparently far from good.
Now that all our data is in the system and we are running our operations off of their system we are pretty much screwed...they can jump the price at any point and we just have to pay it. The sales people lie (no surprises there) about having ways to export your data, but there aren't any really there.
Just be sure before you jump into something like this that you have a way to get your data back AND get it in writing that said tools will always remain and be current.
(and, yes, since we bought into their system they have moved to only allowing Internet Explorer....D'oh!)
It makes sense for a lot of software applications to move online. For instance, I filed my taxes online using TurboTax.com today. The application was easy to use and worked just fine in Firefox. It makes sense to the companies behind these applications because instead of having to deploy multiple versions for every possible obsolete platform (from Win98 to Mac OS 9) that customers may have, they can deploy to specific browser configurations. Plus, as another poster mentioned, bug fixes are built in.
In 10 years' time, I doubt we'll use CDs or DVDs for much. I don't have a CD drive on my current laptop and I have only missed it once since my initial install -- and that was to install an older version of Quickbooks (newer versions are available for download instead of on a CD.) CD-ROM only drives are quickly becoming as obsolete as floppy drives as we move to the Internet for software, music, and movie distribution. As online storage and backup services take over, the idea of backing up to a CD-RW or DVD-RW will also become obsolete. We'll be able to "jack in" anywhere, from any PC/Mac/Internet cafe terminal, authenticate ourselves, and have instant access to all of our data. TurboTax, SalesForce.com and other services like it are just the beginning.
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The article declares that ASP is totally different from SaaS and then completely fails to justify this statement.
Why can't they just say "it's the same thing, but the business climate is more ready for it now?"
+++ATH0
At IBM we called this (with much skepticism) "Maintaining an on *grunt* going *grunt* customer *grunt* relationship".
Being able to charge a subscription fee for your software and continue to get paid, rather than have to make money by continuing to get unit sales, is the holy grail of any software company.
Microsoft tried to force all their customers to this model without a heck of a lot of success. In my opinion, it's not because they couldn't have had this model, it's just that they tried too late - and found out that once something is "good enough", people simply don't spend the money to "upgrade" to something that's the software equivalent of road bed materials: an OS exists only to permit people to run applications, and once they run, you're done buying OS's.
Frankly, I think the best thing that has happened to Microsoft upgrade sales in a couple of years has been that iTunes doesn't run on Windows 98.
-- Terry
The oldest such applications I've had to deal with are time logging application. My employers have had to charge by the hour for my time with the clients. So they always have some sort of web based time logging application. Usually there is also a way to enter expenses and such for reimbursement.
... how hard is it to write a web site to enter hours and tasks.
Every one of these application that I have had to deal with has been very difficult to use. My theory is that they sell the application to one of the bosses based on the way the reports look. They make the user interface for the reports work well. That helps two people per company and saves their time. The people who enter time get the short end of the stick and 200 people waste their time and energy trying to enter hours.
I mean
The first one I had to use only worked right if you used the "right" screen resolution. You were supposed to change your screen resolution to run their application. And, if you didn't, the windows would be too small. They wouldn't scroll. They wouldn't resize. And you couldn't see the OK button at the bottom.
Another one, two years later, would lose everything you entered if you tried to print it at the wrong time.
The one I am using now (in 2006 after 5 years of these sinister felons) makes you go through 5 screen clicks to add more than 40 hours. If you go in to enter your hours after 6 pm on Friday it will default to next week. The first time I didn't know it and entered and submitted all my hours on the wrong week.
I think the it shows the real problem with the business model. There is no incentive to improve the time usage for the people that do the work. The word comes down from on high because the sales doesn't have to convince more than a few people that use the application. This makes the choice of such software a burden on the company's bottom line because, by choosing it, they waste their employee's time.
time is money