In the next five years, over 50 percent of the applications that are sold will be sold as a service. While enterprise software isn’t going to disappear, all the exciting developments are happening in the SaaS world, and small to medium sized businesses, as well as divisions within larger Fortune 500 enterprises, will adopt SaaS because it offers better functionality at a far lower cost and with less risk associated with deploying the application since you pay as you use it. Two types of applications will lead the charge. The first are the applications that were unaffordable before they became available on-demand. The second are the applications that simply weren’t available before in the perpetual licensed software model.
–Treb Ryan, CEO of OpSource.
THINKstrategies has found that enterprises of all sizes are rapidly adopting SaaS to overcome the hassles and costs of implementing traditional packaged applications. A recent THINKstrategies survey, conducted in conjunction with the Cutter Consortium, found that almost a third of the respondents are already using SaaS and another third are considering SaaS, with the vast majority expecting to adopt SaaS in 2006.
The survey also found over 90 percent of the current SaaS users are satisfied with this new application delivery model, 86.5 percent expect to acquire additional SaaS offerings, and almost 92 percent would recommend SaaS solutions to others. The rapid adoption of SaaS has led to the tremendous success of Salesforce.com in the CRM and salesforce automation software arena, and is attracting a wide array of new SaaS providers offering web-based software solutions aimed at addressing nearly every business application need and vertical market requirement.
–Jeffrey M. Kaplan, Managing Director, THINKstrategies.