SaaS business model and new battle lines in software
McKinsey and SandHill surveyed the software landscape (Enterprise software customer survey 2008, pdf) and finds benefit in the SaaS-model. Nicholas Carr analyzes that Software’s new battle lines are becoming visible, citing from the report:
These trends – the growing acceptance of SaaS and SaaS platforms – are likely to create a tremendous battle between the largest software vendors and the newer SaaS providers. While each of these players has an advantage at one end of the spectrum (large vendors such as IBM, Oracle, SAP and Microsoft do best in large enterprises, while SaaS “incumbents” such as Salesforce, NetSuite and RightNow are more in favor with small businesses), the real battle is in the mid-market space. For SaaS platform startups, that means trying to get into a room where there are already two elephants vying for the customer’s attention. Success will mean locating a unique niche – and being prepared to have it invaded.


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