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In December, I predicted that IT would become more comfortable with Software-as-a-Service [SaaS] in 2008, helping to accelerate its growth over the coming months.

Here are some clear indications that my prediction is coming true:

  • SaaScon: CIOs from many big name companies, as well as smaller organizations, spoke about their positive experiences with SaaS and traded insights about how to take fuller advantage of SaaS to meet their end-user and IT management needs.

  • SaaS for IT: A growing number of major hardware and software vendors are offering SaaS solutions specifically aimed at the IT department. Although many of these offerings could be sold direct by the vendors as managed service solutions, they are being pushed through the vendors' channel programs.
  • Platforms: While the initial platform plays in the SaaS market were aimed at software vendors and developers, the more recent initiatives by Salesforce.com (NYSE:CRM), Bungee Labs and Google (NASDAQ:GOOG) have been designed to also appeal to IT professionals and software architects within enterprises as well.
  • Compliance: Many of the CIOs at SaaScon and elsewhere have told me about how they are using SaaS to satisfy corporate, as well as government and industry, compliance requirements. Today's storage and back-up services give many IT organizations the archival and audit capabilities they've lacked until now.

  • You can also add standardization to the list. Many of the CIOs who spoke at SaaScon 2008 admitted that they like the limitations which SaaS places on customization, and they have always known that business unit demands for customized solutions were a major factor in the high costs and failure rate of legacy applications. CIOs are seeing SaaS as a way of reshaping the expectations of business end-users.

    The CIOs I've talked to recently also recognize the financial benefits of SaaS in today's recessionary climate. Its subscription pricing model permits companies to shift their software acquisition costs from tightening capital budgets to more flexible operating expenses.

    And speaking of the climate, many CIOs are viewing SaaS as a 'green' solution because it reduces their computing needs, and 'carbon footprint.'

    Source: Why IT Now Sees SaaS as a Savior