Software is a Service: Evolving business models in a cross-platform, multi-device world

By Jos
Jun 16, 2015
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  1. software service cloud guest saas

    In the world of enterprise IT and high-end business computing, the idea of delivering software as a service is relatively old news. In fact, the acronym SaaS (Software as a Service) is now so commonplace there that you rarely, if ever, see it spelled out anymore. Plus, in that world, everyone is rushing to deliver everything as a service—in fact, the new buzzword is “XaaS,” where “x” is like an algebraic variable that can seemingly represent anything.

    In the world of consumer and small business, however, the concept of software being delivered as service is still relatively new. Many people are just starting to get their heads around things like Microsoft’s Office 365, which provides end users with access to popular Office applications like Word, Excel and PowerPoint. By paying an annual subscription fee, Office 365 not only allows you to get these key applications on your main PC, it also lets you access them on multiple PCs in a household. Plus, when upgrades come out, you get automatic access to those new versions—it’s all part of the package.

    On top of that, you can now gain access to these apps on multiple devices, even across different operating systems, which is a new twist on traditional SaaS. In this era of multiple devices per person, this is extremely important because people need to exist across multiple operating systems and expect to be able to get things done no matter which device they happen to be using.

    Another offering along these lines is the newly unveiled 2015 release of Adobe’s Creative Cloud, which is designed for creative professionals and offers access to Photoshop, Illustrator, DreamWeaver (for website creation and editing) and much more. Like Office 365, Creative Cloud offers a variety of different subscription price models, each of which give you access to the latest versions of Adobe’s key publications across different operating systems on different machines. The new version of Creative Cloud also provides easy (though not free) access to Adobe Stock, a new stock photo and clip art library service.

    In a similar way, Office 365 has moved well beyond the limits of its core apps and moved into online e-mail, calendar, file storage and even business communications with Skype. In that regard, it seems the business model for both Microsoft and Adobe has evolved from “software as a service” to “software is a service” because of all the additional capabilities now available.

    And it’s not just these business software mainstays that are adapting this approach. Many of Apple’s latest software offerings are essentially being turned into services. Certainly the forthcoming Apple Music is a good example, but even Apple’s operating systems (OS X for Macs and iOS for iPhones and iPads) and all the apps that the company bundles with them (iCloud, Pages, Photos, GarageBand, etc.) have become more like services than independent software.

    In Apple’s case, these software updates are now free (as are many, many other web-based applications), but the idea is that underlying software is being subsumed into the greater purpose of delivering a set of capabilities that can be more easily kept up-to-date.

    More and more of the things we want to do, information we want to gather, and methods of communication we want to use are becoming services that are embedded into different platforms.

    Taking this analogy to an even higher level, you could even start to argue that independent applications, both on PCs and mobile devices, have started to go away. More and more of the things we want to do, information we want to gather, and methods of communication we want to use are becoming services that are embedded into different platforms. As with previous examples, some of these services are independent of the underlying operating system while others are becoming increasingly embedded into it.

    The really tangible benefits of these software service models hit home recently as I was setting up some new PCs. After ensuring that I had the latest Windows Updates, all I had to do was enable my Office 365 and Creative Cloud accounts on each of them. Not only did this start the process of installing the latest versions of my core applications, it also gave me cloud-based access to all the documents I create in each of them. Microsoft delivers these documents through OneDrive and Adobe through their own CreativeSync, but regardless, the whole process was significantly easier and faster than the traditional way of installing an app at a time, then updating all those apps, then making sure I had all the files I needed, etc.

    The likelihood that we will all continue to add both to the quantity and variety of our smart connected computing device collections is extremely high, so the value of these new software services cannot be overstated. By giving us the tools we need across the devices we use, they really can make the process of using all our different devices much easier.

    Bob O’Donnell is the founder and chief analyst of TECHnalysis Research, LLC a technology consulting and market research firm. You can follow him on Twitter . This article was originally published on Tech.pinions. Header image via Shutterstock.

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  2. Uncle Al

    Uncle Al TS Evangelist Posts: 1,491   +667

    As said, it's been tried many, many, many times in the past and continues to eventually fail. The failure seems to be the fact that most people don't want to be committed to lots of expenses every year for upgrades, services, etc, etc. From my perspective this is due to the price point. Oh sure, $75 - 100 isn't terrible until you consider many people might have 20-30+ applications they want to keep up, then we're talking an expense that most can't or won't stomach.

    Frankly, I'll be surprised if Microsoft is able to keep the subscription office service much longer, particularly since they cut you off if you stop paying rather than simply not continue upgrading your product. I've still got Office 97 on one of my computers and use it for all the basics simply because I don't need all that power to handle simple word and spreadsheet work.

    Sadly, Microsoft has become so large they can't afford to give the general user a break. It takes a lot of cash flow to keep a corporation that size moving forward and their size and strength long ago drove nearly all the little competitors out of business.

    It was long ago suggested to the big boys they needed to produce scalable software that would address each individuals needs as well as provide all the horsepower for the big boys but as we've seen with them and so many other high end software makers, the all mighty dollar rules the day and nobody can afford to just produce and release products for the love of computing......
  3. MoeJoe

    MoeJoe TS Maniac Posts: 354   +170

    Not everyone wants "cloud" computing.
    Until the pre-Millennial crowd thins out, this communal 'think' will have to be shoved down the collective consumer throat.
    Uncle Al likes this.
  4. toooooot

    toooooot TS Enthusiast Posts: 28   +7

    Why would you ever buy a software for such price when there are alternatives? Subscription for 1 pc is 60 or so on amazon at least. If I decide to use it for the next 4 years, and I intend to, I will have paid 240 dollars.

    Is it what the majority of MS customers will agree to pay? If so, I am not one of them.

    Plus, I don't want to rely on Microsoft cloud. In fact, I don't want to do anything with that.

    But back to the price, it is not attractive. It is almost outrageous. And how is this price beneficial for corporate? When corps still use xp and win 7, they would most likely see the benefits of 2013 version as they would keep it for long time, thus making the price gap between 2013 and 3XX huge.
    Uncle Al likes this.
  5. Felt kind of aggitated reading this.. like being talked at by a sales person/telemarketer but they havn't got to the point yet.. just 'new this', 'benefits that', 'cloud somethingelse'. Got under my skin really quick. Didn't do a very good job of softening me up to get cloudfcked, actually the weaseling just turns me off that bit more.
    Stick your cloud, I'll keep my data, and free software. Software is a service? No, absurd, seeya.
    Uncle Al likes this.
  6. jobeard

    jobeard TS Ambassador Posts: 9,143   +597

    The concepts of Cloud services, SaaS or XaaS look good on the surface, but at the end of the day the user still needs backups and the privacy, security AND the reliability are still a work in progress even as we chat. Business would just love to stop software development, but can't afford to see the AWS (that's the Amazon Cloud) or any other put a stop to the workflow when things go wrong.
    Last edited: Jul 2, 2015

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