TO SAAS OR NOT TO SAAS?
Today with cloud computing, every segment of the technology industry is changed dramatically and ISVs are no exception. Not so long ago, buying software involved a high one-off purchase cost for a solution that you could install on your local computer or server. With more companies preferring to use SaaS applications rather than deal with the time and expense of implementing and maintaining on-premise software, ISV`s are transitioning from an old model of packaged software to SaaS. SaaS comes with added value, it`s browser-based and constantly evolving.
For many ISV`s this process is still at the early stage, as the transformation of legacy on-premise code and existing architectures turn to be pricey and complex. Added to that the changes required for sales models, service delivery, sales training as well as marketing strategies, and the road from an ISV to a service provider becomes difficult with numerous obstacles.
SAAS MARKET: STATS AND PREDICTIONS
Forecasts may vary in estimating Software-as-a-Service market size, but there is an obvious tendency to the expansion of this market. Today organizations of all sizes become more and more comfortable with cloud software services. According to IDC, there are some staggering facts:
- The market will surpass $112.8 billion by 2019 at a compound annual growth rate (CAGR) of 18.3%.
- SaaS delivery will significantly outpace traditional software product delivery, growing nearly five times faster than the traditional software market
- By 2019, the cloud software model will account for $1 of every $4.59 spent on software 1
CHALLENGES FOR ISV`S MOVING TO SAAS MODEL
To stay competitive in dynamic business models today, independent software vendors must go further their comfort zone – from application development to openly embracing new sales models. There are a few key challenges to overcome2:
- Ability to address a wider target audience: addressing entirely new markets, or expanding into different regions.
- Application development: making your software browser ready, constantly upgrading customers to the latest version, optimizing the software for scale, etc.
- The quality of service delivery: ensuring customer satisfaction through quality of service is essential
- Data security: Not just selling the software, but ensure the data security, privacy and regulatory compliance as a cloud service provider
- Billing and cash flow management: managing cash flow ‘dips’ while sales are moving from a large ‘one-off’ payment to a small recurring monthly payment
- New sales models: changing selling models to subscriptions, often it requires to adapt and optimize sales targets
It`s important for companies to understand how the transition to SaaS affects more than the strategy, organization and operational aspects of your business – it’s a deep change from providing a product to providing a service. With many stepping stones along the way, a trusted partner that understands the challenges is the best place to start.
AWINGU IS YOUR HELPING HAND
Want to successfully meet the challenges of moving to SaaS? Awingu can facilitate your journey. We know your business and we understand how legacy applications can be transitioned to a cloud-based model. Our solution offers key features to make the transition as smooth as possible:
- NO CODE CHANGE NEEDED: Make your software available in HTML5 without the need to change your code
- MULTI-TENANT: Easily manage your offering from one single platform
- CUSTOMIZABLE: Customize everything, from login page to relevant colors of your brand
- RUNS IN ANY CLOUD: You are in control of the technology used and the margins generated.
The transition from ISV to SaaS provider is not necessarily an easy one, but well worth it in terms of market opportunity and the potential for growth. Don`t think twice, we are here to help you! Check out how Awingu helped two ISV`s to move to SaaS, one for B Rekencentra and another case of Infodidac, a company that created a school administration software.