From SaaS week;

IDC has released a study on the emerging SaaS channel in which it concludes that Software-as-a-Service may have a serious impact on traditional partner revenue streams.

In the press release, senior analyst Erin TenWolde said, “Two big wrinkles for partners are obviously the subscription revenue stream associated with SaaS solutions as well as selling ‘virtual’ products where there is nothing to physically ship, implement, or keep on the shelf. This is going to drastically change the way partners and SaaS providers engage with one another in the future.”

Darren Bibby, also a senior analyst, predicted a shift of technology-centric solution providers to business process consultants and the emergency of new partner types.

The study also concluded that nascent partnering models still exist in the SaaS ecosystem but that activity is occurring on a trial and error basis, that VARs face potentially large challenges in securing revenue in resale scenarios, and that new solution providers will emerge to develop discrete expertise in niche areas.

Is there anyone out there who didn’t realise that SaaS threatens ISV’s? Why do you think they’ve been (in equal parts) acquisitorial of and caustic about SaaS?


Ben Kepes

Ben Kepes is a technology evangelist, an investor, a commentator and a business adviser. Ben covers the convergence of technology, mobile, ubiquity and agility, all enabled by the Cloud. His areas of interest extend to enterprise software, software integration, financial/accounting software, platforms and infrastructure as well as articulating technology simply for everyday users.

1 Comment
  • This abstract of the IDC study makes a point of challenging SaaS vendors to rethink traditional channel partner strategies. I’m not sure that the SaaS model threatens ISVs, other than those providing low cost point solutions. There will always be companies that want to host and manage their own application software systems, especially when those applications are part of a mission critical SOA. The SaaS model seems to be most applicable when there are limitations to scope, unique functional requirements, budget and IT resource availability.

    I agree with the observations regarding channel partner models. The upside of selling SaaS solutions is very limited for traditional resellers. SaaS resellers that can provide specific value added services either pre, during or post SaaS implementation would seem much more viable.

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