Users Quantifying Increased Adoption of SAAS in the Enterprise

 
 
By Chris Preimesberger  |  Posted 2009-03-12
 
 
 

SAN FRANCISCO -- Analysts and researchers have been saying it for months -- perhaps even a couple of years -- but the idea that enterprise use of software as a service may now be the hottest sector of IT is now being quantified by those actually using it in the real world.

According to industry experts, vendors and users at OpSource's fourth annual SAAS Summit, enterprise SAAS (software as a service) now ranks right up there with storage and data protection as among the best-selling and most active places to be in the IT industry.

"The economy is putting the wind at our back," LiveOps Chairman/CEO Maynard Webb, a 30-year veteran C-level exec, told about 500 attendees in a keynote address.

LiveOps, based in Santa Clara, Calif., provides on-demand call center services.
SAAS has many variations and aliases, which include the terms cloud computing, on-demand applications, grid computing, real-time computing services and others.
The idea of subscribing to software as a service for business goes way back to the big-hunk mainframe computers of the 1970s, which companies such as IBM and Amdahl built for subdivided services.

Later, in the late 1990s, companies that provided services via the Internet or through private networks were called "application service providers," which is the previous-generation forerunner of today's SAAS. Because the availability of broadband I/O bandwidth has increased so dramatically, SAAS is becoming increasingly important in the enterprise -- especially in the current U.S. economic downturn.

"Companies used to spend $20 million to $30 million on [software] deployments ... now they can leapfrog to a whole new level of deployment [in SAAS], and get services just as good, or better, for amazingly less capital. How often can you say that?" Webb said.

"SAAS is not just for SMBs; this is the fast-growing piece of the software industry -- the biggest and sweetest space in software at the moment."

The days of proprietary "walled gardens" and vendor lock-in are long gone, Webb said.

"Most of the newer companies [Web 2.0] understand the value that SAAS brings to a business, whereas many of the older, more established enterprises -- which are generally larger and more adverse to change -- are still questioning whether SAAS and cloud computing can help their business model," Webb said.

In the latter cases, Webb said, three main factors are holding SAAS back from implementation.

"No. 1 is relevance; the world wants relevance. It's got to work, and work well," Webb said.  "And SAAS, if implemented correctly, does bring great value.

"No. 2 is availability; SAAS might not be as sexy as some things [because it's all in the internal enterprise IT system], but at least at our shop, we're [LiveOps] up to five nines of availability; that's only 5:35 minutes of time down in one year," Webb said.

"Security is No. 3; it's a matter of trusting your data to the service," Webb said. "SAAS also represents a huge opportunity around innovation; SAAS can help innovation develop much better than traditional companies."

The summit, which concludes March 13, has break-out tracks on green IT, SAAS marketing, and architecting and delivery.

Most of the presentations from the conference will be posted on the summit Web site after the conference concludes. For more information, go here.

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