Friday, January 26, 2007

SaaS: SaaS takes off in Japan

Tokyo still remains one of my favorite destinations in APAC and on a visit with clients and media, it became quite apparent that SaaS was top of mind in the market. I wondered if I had came to Japan a week after Marc Benioff or if the market had been that enthusiastic to begin with. (I would later find out it was's Japanese AppsExchange pre-announcements. )

In either case, the number one topic of interest from system integrators related to how one could build a SaaS business. Meanwhile customers sought more information on SaaS offerings and the media kept asking for details on the difference between SaaS, Hosting, ASP, and OnDemand. and NetSuite had top billing in terms of mindshare, while WorkDay remained of major interest given the tie back to PeopleSoft founder Dave Duffield.

SaaS continues to gain mind share, especially as customers remain frustrated with paying so much for maintenance, receiving very little in terms of value in upgrades, supporting legacy applications, and refusing enhancements and feature requests to the business side. More importantly, business leaders in large enterprises choose SaaS mainly because they can do an end run on the IT department, receive new functionality, and pay for it using operational expense instead of capital expense. That last bit is key because they don't need board approval for an operational expense. As more business leaders weigh-in on IT decisions, SaaS vendors see growing interest from enterprises instead of the SMB market as anticipated.

Related Forrester Research
Comparing The ROI Of SaaS Versus On-Premise Using Forrester's TEI™ Approach
The Financial Impact of Packaged Applications
The State of Enterprise Software Adoption

(The personal contents in this blog do not reflect the opinions, ideas, thoughts, points of view, and any other potential attribution of my current, past, or future employers.)
Copyrighted 2007 by R Wang. All rights reserved