The Changing Nature of the Cloud

| About:, Inc. (CRM)

One of the hottest topics of discussion in the Software-as-a-Service (SaaS) market and broader Cloud Computing arena is the role of the channel in selling and delivering these web-based services and solutions. What few people have discussed is the opportunity for SaaS companies, as well as Cloud vendors, to become important channels to market themselves.

The most intriguing scenario in this SaaS-as-a-Channel (SaaC) possibility revolves around the Data-as-a-Service (DaaS) idea. The most recent illustration of this scenario is today’s announcement by Host Analytics of a new Decision Hub service which pulls industry data from a variety of third-party information service providers, such as Edgar Online and Data.Gov, into Host Analytics’ SaaS-based corporate performance management (CPM) solution.

The Decision Hub enables corporate decision-makers to examine their company performance in relation to a broader set of industry benchmark data or key performance indicators (KPIs).

This isn’t a new idea, but today’s leading SaaS vendors have the opportunity to aggregate this information from a variety of data sources more quickly and economically because of an assortment of application program interfaces (APIs) and generally accepted web services.

Another case in point is (NYSE:CRM) which has had a longstanding relationship with Reuters and acquired Jigsaw earlier this year to pump valuable data through its customer relationship management (CRM) and salesforce automation (SFA) solutions to help its users achieve their business objectives.

So, as these data aggregation capabilities become more prevalent, it changes the nature of the SaaS company. Rather than simply being an application provider, it is now providing a higher level business service powered by a mixture of third-party data sources.

In essence, SaaS companies are now becoming information distributors in addition to application providers. In other words, they are now becoming an increasingly important channel to market for information service providers.

It will be interesting to watch other types of vendors attempt to employ SaaS companies and Cloud service providers as new channel partners as well. Of course, as they do, they will encounter a new set of challenges regarding how to properly package, price and promote these new relationships.