Seeking Alpha
Profile| Send Message|
( followers)  

Back to back announcements this week have brought renewed attention to the IT service management (ITSM) market as a key battleground for Software-as-a-Service (SaaS) competition.

On January 19, BMC announced its latest Remedy ITSM Suite On Demand solution, a SaaS-based offering which promises to integrate with BMC’s Atrium Configuration Management Database (CMDB) and Business Service Management (BSM) platform.

That same day, Service-now.com announced that PepsiAmericas (PAS) had selected its SaaS-based ITSM solution. In Service-now.com’s announcement, PepsiAmericas’ IT Customer Service Manager, Amy Irwin said,

Our old tool couldn’t meet our needs so we went shopping for a tool that could. We quickly determined SaaS would best fit our tool requirements.

IT acceptance of SaaS-based solutions isn’t new. THINKstrategies first identified this trend in our 2007 customer survey in conjunction with Cutter Consortium.

However, SaaS vendor focus on this segment of the market has intensified over the past two years. Service-now.com has experienced significant growth in the mid- and large-scale enterprise market with its SaaS-based ITSM solution. The company won a Best of SaaS Showplace (BoSS) Award for the measurable business benefits its solution delivered Unitus Community Credit Union.

BMC Software (NASDAQ:BMC) has been dabbling in the SaaS market for a few years. THINKstrategies published a profile of BMC’s initial SaaS offerings in 2006.

Like other established independent software vendors (ISVs), BMC has been attempting to rearchitect it software application, realign its go-to-market strategies, and reorient its business operations in order to integrate its SaaS offerings into its legacy portfolio. Last November, BMC announced at Salesforce.com’s (NYSE:CRM) Dreamforce conference that it was developing new ITSM solutions on Salesforce.com’s Force.com Platform-as-a-Service (PaaS).

It is no coincidence that Salesforce.com has targeted this market with its Service Cloud offerings. CA also announced at Dreamforce its intent to ‘SaaSify’ its ITSM capabilities via Force.com.

HP has also been circling these waters with its cloud-oriented solutions.

Why all the attention on this segment of the SaaS marketplace?

Because this is one of the few places within an organization that touches everyone and where the IT department and business end-users directly intersect. Therefore, the SaaS solution plays a pivotal role in this area and can have a tremendous strategic impact on an organization’s day-to-day operations standpoint.

I expect activity in this segment of the SaaS market to escalate and a series of acquisitions to follow.

Source: SaaS IT Service Management War Escalates