Software as a Service: Just a delivery model?

milk delivery modelI was speaking yesterday with someone in charge of the SaaS initiative at a very large technology company. In the conversation he described Software as a Service (SaaS) as a “delivery model”. Now of course SaaS is a delivery model, but it is not just a delivery model, nor is it primarily a delivery model.

In fact the word delivery starts from the wrong place. Isn’t SaaS mostly about the consumption model? That is, we should start from the customer’s perspective, not the vendor’s, and the customer wants to consume software like a utility that can be plugged in, configured, even integrated, then used. The usage grows as the demand grows, and often the payments also grow with usage. Therefore the customer does not have to spend money up front on hardware, software, and people, but can pay as they go.


2 responses to “Software as a Service: Just a delivery model?

  1. Well, it’s both a consumption model and a delivery model. The answer, of course, is based on your frame of reference at the time. Some vendors can deliver their product both ways: i.e. either via SaaS or on-premise to a customer. I’m assuming, those customers pay for (consume) the software differently, depending on the model.

    The general thinking is that it will be very difficult for software vendors to support both models efficiently as the processes for delivering (selling and supporting) them are different. I tend to agree with this, though certainly some companies today (e.g. SugarCRM) are succeed with a dual delivery model. I could make a joke here about Sugar consumption, but I’ll refrain.

  2. It is a truism to say that the answer is based on your frame of reference. Perhaps you think it sounds like a small point to distinguish between the terms “consumption” and “delivery”. But this is exactly my point: enteprise software companies are thinking of things from their own perspective, which leads to terms like “delivery model”. If we think about it as a consumption model, we are more likely to think more broadly than just the software; it’s about the whole experience of consumption.

    I’ll be publishing an article later this week in which I get into more detail about the overall experience of consumption of SaaS. I believe that SaaS is a revolt against the sins of enterprise software past… more tomorrow.