SaaS-man, meet your nemesis, Mr. Cloud
If these two were comic book superheroes, Mr. Cloud would have his heel on SaaS-man’s throat while covering poor SaaS-man in kryptonite.
While once brothers in having the same appeal of off-site management, they are now going to have more of a distinct duality rather than their past blurry line and SaaS may lose market and mindshare to cloud based alternatives.
SaaS has been appealing for quite some time in that, as a software buyer, I can rent the software and then entrust the vendor to update the software and ensure it runs smoothly. The downside though is that you’d be running the same software in the same instance as another customer of that software, making it hard to customize.
Mr. Cloud (along with his trusty sidekick Captain Virtualization) solves that by adding elastic capacity to your very own version of what would have otherwise been on-premise software. This same software now running on some server at some unknown location can be customized to your heart’s content making it more attractive than SaaS.
Microsoft’s Office365 is really shinning a light on the whole concept. A full version of SharePoint 2010 that’s fully customizable to whatever degree you so choose. Yet, you don’t need to read the first half of the 4 inch thick SharePoint books anymore that begin with installation and configuration of your server farm etc. You can just get straight to the customizing and using.
This may not yet be quite as easy as starting a collab site in a SaaS option of something like Basecamp, but the extra effort plus the added value and flexibility that SharePoint would provide starts to make the cloud option awfully compelling as we watch SaaS-man fade into more and more niche based opportunities.
CRM will be a major battleground for this and we’ll see how well or quickly Microsoft distinguishes its own Dynamics CRM Online vs. having Dynamics rolled into Office 365 options as add-ons. This may be where Microsoft can gain some real headway on Salesforce.com.