Predictions for On-Demand Services in 2009
Here are ten forecasts for how the on-demand market will evolve in the coming year.
By Jeffrey M. Kaplan, THINKstrategies
Jan. 13, 2009
The start of a new year is always a good time to reflect on the year that has past and look forward at the year to come. While many of us would like to forget last year and are not exactly looking forward to 2009, there is much to be learned from the past and plenty of predictions which can be made about the near future.
A closer look at the market for on-demand services reveals that the model will continue to evolve in 2009 and that any short-term slowdown will only be a hiccup on the way to a positive long-term outlook.
A Look Back at Last Year's Forecast
A year ago, I identified ten reasons why I thought on-demand services would soar. At that time, I was convinced that SaaS, cloud computing and managed services would not only gain greater customer attention but would also experience accelerated adoption despite growing concerns about a impending recession. THINKstrategies' latest SaaS survey conducted in conjunction with Cutter Consortium in October confirmed this prediction by finding that customer adoption doubled in 2008.
The growth of SaaS, cloud computing and managed services is actually being driven by the economy as organizations of all sizes and across every industry seek more cost-effective alternatives to traditional, on-premise software. They are also looking to develop and deploy business applications more quickly, and with fewer risks. Many organizations are also interested in offloading, or out-tasking, various IT/application management responsibilities to external services providers who can perform these functions more effectively and permit organizations to redirect their limited inhouse staff toward more important corporate initiatives.
I also predicted a year ago that IT professionals would begin to recognize that SaaS, cloud computing and managed services are not a threat to their livelihoods, but instead represent enablers which permit IT operations to better support the needs of their business users. As a result, SaaS, cloud computing and managed services providers no longer have to view the IT organization as the enemy in their efforts to sell their solutions.
Organizations are also adopting SaaS and cloud computing alternatives to better support a more dispersed and mobile workforce, as well as customer base and partner network. The traditional workplace is becoming a thing of the past, and today's on-demand services are better architected to respond to provide the anytime/anywhere access to business applications and corporate data workers need than traditional, centralized software and security architectures.
As a consequence, THINKstrategies' latest survey also found that well over 90% of SaaS users are not only satisfied with their on-demand solutions, they also plan to renew and expand their use of these services. Even more importantly, they would recommend SaaS solutions to their peers.
Predictions for 2009
As a result of the last year of SaaS developments, here are our predictions for 2009:
1. On-Demand Services Move From Why To How...
Now that SaaS has achieved widespread market penetration and the idea of cloud computing has become popularized in the business as well as trade press, the discussion will shift in 2009 from why organizations should adopt SaaS/cloud computing services to how to do it effectively. This shift will also encompass the value of adopting managed services for IT management purposes. IT/business decision-makers will seek help evaluating the functionality and financial viability of the various vendors; better understanding the integration and security requirements; monitoring vendor performance and service level compliance; and measuring the economic impact and business benefits of these services.
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A closer look at the market for on-demand services reveals that the model will continue to evolve in 2009 and that any short-term slowdown will only be a hiccup on the way to a positive long-term outlook.
A Look Back at Last Year's Forecast
A year ago, I identified ten reasons why I thought on-demand services would soar. At that time, I was convinced that SaaS, cloud computing and managed services would not only gain greater customer attention but would also experience accelerated adoption despite growing concerns about a impending recession. THINKstrategies' latest SaaS survey conducted in conjunction with Cutter Consortium in October confirmed this prediction by finding that customer adoption doubled in 2008.
The growth of SaaS, cloud computing and managed services is actually being driven by the economy as organizations of all sizes and across every industry seek more cost-effective alternatives to traditional, on-premise software. They are also looking to develop and deploy business applications more quickly, and with fewer risks. Many organizations are also interested in offloading, or out-tasking, various IT/application management responsibilities to external services providers who can perform these functions more effectively and permit organizations to redirect their limited inhouse staff toward more important corporate initiatives.
I also predicted a year ago that IT professionals would begin to recognize that SaaS, cloud computing and managed services are not a threat to their livelihoods, but instead represent enablers which permit IT operations to better support the needs of their business users. As a result, SaaS, cloud computing and managed services providers no longer have to view the IT organization as the enemy in their efforts to sell their solutions.
Organizations are also adopting SaaS and cloud computing alternatives to better support a more dispersed and mobile workforce, as well as customer base and partner network. The traditional workplace is becoming a thing of the past, and today's on-demand services are better architected to respond to provide the anytime/anywhere access to business applications and corporate data workers need than traditional, centralized software and security architectures.
As a consequence, THINKstrategies' latest survey also found that well over 90% of SaaS users are not only satisfied with their on-demand solutions, they also plan to renew and expand their use of these services. Even more importantly, they would recommend SaaS solutions to their peers.
Predictions for 2009
As a result of the last year of SaaS developments, here are our predictions for 2009:
1. On-Demand Services Move From Why To How...
Now that SaaS has achieved widespread market penetration and the idea of cloud computing has become popularized in the business as well as trade press, the discussion will shift in 2009 from why organizations should adopt SaaS/cloud computing services to how to do it effectively. This shift will also encompass the value of adopting managed services for IT management purposes. IT/business decision-makers will seek help evaluating the functionality and financial viability of the various vendors; better understanding the integration and security requirements; monitoring vendor performance and service level compliance; and measuring the economic impact and business benefits of these services.
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