Great post. I laughed when I saw ‘ASP’ and remember a prominent San Diego startup that spun off of Titan years ago. It blew through a ton of money and eventually went by the wayside.

Of course that was then and this is now. As you mentioned, when a company’s data resides outside the firewall huge security issues ensue. I believe this was the key reason the earlier ASP models failed. I don’t see that this has been satisfactorily resolved yet.

When it gets resolved, however, we’ll see Web 3.0 take off like the proverbial rocket. (My definition of Web 3.0 is the addition of artificial intelligence to the cloud so that when I text my friend asking if he’s aware of a good tire store I may receive the latest tire sales and promos in the area where I live. Of course the permission issue is equally important as the security issue.)

Things go in and out of style, like fashion. While fashion get its cue from consumer fancies, technological trend is driven by needs, and the technological advancement available to support that trend. By the same token, this advancement was responsible for the changes in the way we work, live, and affects many aspects of our lives, e.g. the invention of smart phone. We all know what Internet has done. Mobile computing is happening. Their impact is not over but constantly involving. The user community has grown into main street. The only way to serve this huge and growing user base is utility computing, currently identified with Cloud-based and SaaS solutions.

The problem however is that some companies would emphasize SaaS and Cloud when describing their products for the sake of getting on the band wagon. You can quite easily identify them when their description of SaaS and Cloud just don’t make sense.

The points I’m trying to make are:
- the feeling of deja vu is because solutions are constantly morphing to meet the needs and changing market demand in the best possible way given the current state of innovation
- old technology, like mainframe, client/server, etc… will still be around, albeit in niche areas, until such time when a better solution becomes available supported by the latest innovation.

Eddie

The ‘battle’ between embedded IT orgs and what the business thinks is available out there ‘in the cloud’ to reduce costs (and shrink IT to some core specialists and governance types) is gathering momentum… but I imagine that concerns around risk and compliance are heavy anchors which may slow down, or even stall, adoption by many large corporations for a while.

The segment taking off first in SaaS is unambiguous–it’s CRM. And that is primarily Salesforce.com.
I don’t necessarily think it’s because of the segment itself, but the execution of Salesforce. They are now upping the ante and trying to become a Cloud Computing platform, rather than just a CRM application. Using their technology to enable others to create SaaS apps that can be integrated, etc. The thing to do is to analyze the segment you are interested in directly: How important is the data portion? Will people be uncomfortable that this data isn’t behind their own firewall, from a security standpoint? How big of a problem will Internet latency (or completely down Internet connection) be? How complex is the app to deploy each time within the end-user’s firewall? And so on. This will give you your answer on an segment’s near term SaaS potential -Phil

Thanks for your Post. I have also lived the proprietary to Unix period 20 years ago and well, the mainframe guys still make good money

A quick question for you. Rather than whemn, where do you think IaaS and SaaS will take off fist?

Have you made any analysis on the segments that will first get value out of these models?

Thanks for your insights
Christophe

I don’t know of any market analysis, but I haven’t been looking. I’m certain that there are projections out there on a trend this important. But I would caution against you using such studies as a basis to making a business decision–these types of projections have a habit of being notoriously and dramatically wrong–usually on the upside. The best advice I can give you is to analyze your market and user, and meet their needs. But if you are contemplating a new product, there is also nothing wrong with coding your product in such a way that it can be delivered EITHER via the cloud as a service, or behind a customer’s firewall as a traditionally licensed product. This gives you flexibility to serve users of different psychographic profiles, and effectively hedges your bet.

I liked your BLOG. While I do believe in the promise of Cloud/Saas in terms on bringing greater efficiencies, I don’t see it as being all things to all people from day one.

Therefore I’d be interested in your view any detailed market segment analysis you’ve come across which indicates exactly how big the realistic target market for these technologies will be in the next 3-5 years.

As you’ve pointed out, there are real issues such as the underlying quality of the connection and availability, etc. which are real obstacles to many potenital cusotmer adopting these new models.

Regards,

Niall