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Software-as-a-service (SaaS) is clearly a major force in the software market, creating an attractive alternative to licensed software in terms of pricing and delivery. But SaaS doesn't affect all segments of the software market equally. Instead, our analysis is that SaaS will have little or no effect on 40% of the software market (measured by vendor revenues) and will carve out a minority share in another third of the market. That means SaaS' impact will be concentrated in products that currently are one-quarter of the software market. In some of those categories, such as CRM, SaaS has been truly disruptive, providing alternatives that are displacing and replacing licensed software. In other cases, new software products are being introduced only on a SaaS basis, with licensed products not offered at all or coming in later. Understanding the potential adoption of SaaS by software product can help vendor strategists determine where and where not to offer SaaS products and can help sourcing professionals understand where SaaS products are options they ought to consider.
Agenda:
Vendors mentioned: Salesforce.com, Microsoft, NetSuite, Taleo, RightNow, Ultimate Software,NorthgateArinso, EMC, Oracle, SAP, ADP, IBM, Ariba, Click Software, Kronos, Aravo
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Software-as-a-service (SaaS) is an important new set of capabilities and engagement models in the IT industry, particularly in the emerging world of cloud computing. We project that SaaS offerings will grow from 7% of total software revenues in 2010 to 17
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