It's one thing to catch the wave of a new trend early. It's another to be part of the team that started it all. In the summer of 1999, at the crest of the dot-com era, I was fortunate to be one of the first employees to join a company led by Marc Benioff that vowed to change the face of the software industry. That company was salesforce.com, one of the pioneers in the software-as-a-service (SaaS) movement. During my tenure as chief strategy and chief marketing officer, I helped evangelize the vision that we called "The End of Software." This mantra was our conviction that software belonged on the Internet, not on a CD, and in that process it is transformed from a product that you buy to a service that you subscribe to.

Fast-forward almost a decade to 2008. The world now accepts saleforce.com's premise as a core tenet. Software as we once knew it is not coming back and SaaS is here to stay.

But that is not the end of our story. I have now come to realize that this transformation has not been restricted to just our software industry. All around me, everywhere I look, in industry after industry - products are being transformed to services in front of our very own eyes.


The way we shopped 10 years ago vs. the way we shop now
Ten years ago, the only way to view a movie at home was to buy the VHS or DVD. Today, over six million people have not bought a DVD in years - instead, they subscribe to Netflix and have access to any movie they want. Ten years ago, most of us purchased cars. Today, I personally am a subscriber to Zipcar, and have access to a fleet of 5,000 cars across 50 different cities, guaranteeing I can get the car I want, when I want it, and all under a pay-as-you-go model. Ten years ago, your only choice if you wanted a $2,000 Louis Vuitton handbag was to buy it. Today, you can subscribe to Bag, Borrow or Steal, and have a virtual closet full of bags for every occasion.

Why is this trend happening? To understand why, just listen to the Zipcar pitch: no large up front investment, no ongoing maintenance costs or hassles, no insurance costs - just pay for how much you use. Sound familiar? It's the same pitch we've been using at salesforce.com for the last nine years. The reasons that made SaaS the dominant model for creating and delivering applications are the same reasons why subscriptions are taking hold in all other industries both BtoB and BtoC:

• Greater choice for consumers - Before, consumers had to choose one option that was bought and used as-is. With subscriptions, consumers can choose from many options, in many different packages. It's the difference between having the same car to use every day for several years vs. having thousands of cars to choose from every day at a more convenient cost.
• Removes element of commitment - Who hasn't bought something only to realize it's not what you need, or like, after all? Or it is satisfying for a short time but now you need something different. On-demand means changing your service on your terms. With Netflix, for instance, you can decide to that you only want two or three movie rentals at the time, only to decide later you'd really like to receive more movies, more often, or less movies less often. You have the choice to change your subscription as often as you change your mind.
• Highly customizable services - Both business and consumers are more likely to buy from a particular company or brand when they have the power to pick and choose how the product works for them. The small start-up with basic CRM needs isn't going to use the same salesforce.com package that the enterprise client will use. They choose what packages and pricing options fit their businesses and as they grow, so does their options.

Most of all, the Internet is behind this change, just like it was for the SaaS industry. The Internet is what allows new business models like salesforce.com, Netflix, Zipcar, and Bag Borrow & Steal to be possible. The world is ready to stop buying —software, movies, cars - and start subscribing.

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