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Tuesday, May 09, 2006

SaaS 2.0 : Next Generation Business Platform

Bill Mcnee, Bruce Guptill, Mark Koening & Jim Cassell at Saugatech have come up with an excellent report on SaaS – this qualifies to be amongst the best research report on this subject. They argue that the stage is set for the advent of SaaS 2.0, which would significantly extend and fundamentally change the conceptions about SaaS as we know today. SaaS 2.0, as they see it will incorporate advanced SOA and business process management technologies to provide a next-generation business management platform that competes with, and in many cases, replaces, traditional enterprise applications. I liked the discussion about the evolution of SaaS as covered in the report but particularly their prescription for SaaS vendors to serve customers better makes interesting reading :

SaaS vendors will increasingly need to provide customers with greater choice across the following dimensions
– Deployment Choice: Provide both net-native and behind-the-firewall options (as many large enterprises need an on-premise option, especially in the Financial Services and Government sectors).
– Payment Choice: On demand does not always have to equal pay-as-you-go. This applies to both the frequency of payment, as well as the license type (which can be either term or perpetual with maintenance – depending on the financial preference of the customer).
– Upgrade Choice: Forced upgrades don’t work, mandating that SaaS applications be both multi-tenant and multi-version – supported by a automated upgrade process (all controlled by the user, in terms of when they want to upgrade).
– Integration Choice: Provide multiple paths and methods to integrate seamlessly through web services, which helps remove any location constraints.
– Customization Choice: Go beyond providing a richly configurable environment by providing an architecture that supports customization (e.g., user interface) within the context of a multi-tenant environment.

I also liked their idea of SaaS integration Platforms – such platforms will function as a solution “hub” providing integration, delivery and management services such as:
– Application sharing and integration services to support multiple applications simultaneously (as well as to provide tight linkages to remote and or behind-the-firewall applications),
– Common interfaces and data models
– Bundling, provisioning and configuration services
– User management and administration (e.g., authentication, authorization, auditing)
– System performance optimization
– Fee-based or commission-based aggregate licensing, billing, invoicing and payment services for software and services vendors

• The SIP platform creates the potential for value-added services such as analytics, vertical application bundling, managed services, vertical or domain-specific best practices consulting, and business process-specific services. These can be delivered to the customer base by SaaS solution providers, aggregators, SIs and/or VARs.
• Ultimately, it will be large enterprises who will demand richer SaaS integration and management services for the increasing complexity and mission-critical nature of SaaS 2.0, rather than much of the market today which is around servicing SaaS start-ups.

Overall, a very impressive coverage of the state of the SaaS market today besides looking at the future of the SaaS ecosystem , its evolution and implications make this report a compelling reading for all interested in SaaS. The report is available here.

(Image Courtesy : Saugatech)

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Sadagopan's Weblog on Emerging Technologies, Trends,Thoughts, Ideas & Cyberworld
"All views expressed are my personal views are not related in any way to my employer"