Amy Wohl makes some predictions about the software-as-a-service market:
1) This market is growing in a serious way. I would expect a company of any] size to be able to purchase all of the software function it wants and needs as a service, rather than as traditional software, installed within its own firewall, within 3 to 5 years.
(2) Of course, I don’t expect every company to want to move all of its IT needs to the SaaS platform in that time period. I do expect even large companies to move functions that are used only occasionally or only by small numbers of users to an outside service provider.
(3) SaaS will increasingly look like a great solution for commodity problems like Email, for companies of any size. Remember, having Email supported by SaaS means outsourcing your Spam problems, too, and most of your virus problems as well.
(4) Look for large traditional software players to start to seriously offer SaaS-based alternatives to their traditional software offerings. These have to be serious, full-function alternatives rather than Microsoft’s recent foray into on-line services, offering incremental services to Office users, but still requiring the customer to install Office on every workstation and multiple Microsoft servers within the firewall.
(5) Watch the innovator companies like Google figure out how to be SaaS vendors beyond the consumer function they offer now. Inevitably, they’ll offer software to the small business market and they may decide to move beyond that into services that appeal to the remote workers of large companies, for example.