Online business software | Cloud Computing

Another influential US business analyst has weighed into the cloud computing and software as a service (SaaS) debate.  McKinsey & Co analyst Will Forest’s presentation goes into considerable detail on definitions and where the technology is making its impact.

The presentation supports what we have been saying for the past few months:  cloud services and SaaS can provide significant benefits to small and medium sized businesses – especially when those businesses don’t already have cash and resources tied up in expensive business software, data centres or storage.  This is because it gives smaller businesses access to these applications and functions without the overhead.

Is the cloud mature enough to help large enterprises save money?  Maybe.  But frankly, businesses of that size have the budget to experiment.  Smaller businesses don’t – so they are likely to simply get on with their business and take advantage of the SaaS model, as Gooroo’s recent survey says.

If you’d like to find out more about what our software can do, we’re exhibiting at the Business Growth show, Ramada Piccadilly, Manchester, Wednesday 22^nd April.  It’s free to enter.

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Germany may beat us at football, but they lag behind both the UK and France in business uptake and use of software as a service (SaaS), according to a new Gartner survey announced recently.

In its “User Survey Analysis: Usage Plans for SaaS Application Software, France, Germany and the UK 2009” report, Gartner found 71% of French survey respondents said their organisation currently uses SaaS for business applications, compared to 68% in the UK and just 45% in Germany.

“France is only ahead by couple of percentage points, so it is not a massive difference to the UK,” said Chris Pang, principal analyst at Gartner. “In France, the high adoption rate is probably explained as there are a few more local vendors offering SaaS solutions … it is usually small scale accounting solutions in France.”

The Gartner survey focused on companies in the SOHO, SME and large enterprise sectors, with most in the mid market area.  And in several ways it echoed the findings of Gooroo’s own survey of SME attitudes to cloud services and SaaS, reported here a few days ago.

For example, Gartner says the economic downturn will decelerate purchasing of any new software, but SaaS is more resistant as it is normally paid out of operating budgets.  Our survey found that cost considerations were key for businesses choosing cloud apps.

The Gartner survey respondents were also clear on their motivations for using or considering using SaaS in 2009.  Most agreed that they choose SaaS primarily because they considered it more cost-effective than an on-premises application. Other reasons given included ease of deployment and internal resource constraints – points which again echo our own survey.

So it certainly looks good for SaaS and cloud apps in the coming year.

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With all the buzz around cloud computing and cloud services, perhaps it’s no surprise that a poll of Chief Information Officers (CIOs) reckon it will be the most over-hyped technology this year, even ahead of Windows 7 or Google apps.

The survey, by leading IT portal Silicon.com, goes on to say that less than one in 10 of the tech chiefs responding listed software-as-a-service or grid and utility computing as one of their technology priorities for this year.

While the survey is right in one way – there certainly has been a lot of speculation and coverage of cloud computing – hype doesn’t mean the technology will not take off.  What’s more, it looks like it’s set to take off at the small business end of the market.

We’ve just completed a survey (we will release the full findings shortly) that shows 54% of UK small businesses will be using cloud software solutions for key functions by the end of 2010.  The economic downturn is driving companies to seek alternatives to traditional business software.

Perhaps the telling aspect of the Silicon survey is technology that CIOs rated as overhyped in previous years.  In 2008, it was the iPhone – a spectacular success – and in 2007 AND 2006, Windows Vista.  OK, Vista is flawed, but can’t be ignored.  So, hyped the technology may be.  But that doesn’t mean it won’t succeed. 

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When people start making cartoons based around technology, you know that the technology is crossing over into the mainstream.  The cloud secotr is no exception.  Daryl Plummer, an analyst for Gartner Group, the leading analyst body, has started publishing a series of cartoons taking an affectionate, ironic view of cloud computing. 

Called the “G-Men”, it pokes knowing fun at the misconceptions and buzzwords surrounding the area.  Is it a Dilbert for the cloud age?  Judge for yourself:  you can read the strip from the beginning here, and see Daryl’s general blog here.

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When Microsoft says something, it’s always worth listening to. Especially when it involves moving to a new model of software delivery that doesn’t involve physical disks or boxes.  Of course, they have a vested interest in cloud computing, but it’s interesting to get their viewpoint simply because of who they are.

In this case, Doug Hauser, Microsoft’s general manager of business strategy, cloud infrastructure services, said that a weakened economy will help to push businesses from on-premise computing to accessing cloud services

He added that the small-to-medium business sector was “looking at [cloud computing] adoption anyway, regardless of the economic climate.”

What’s clear is that Microsoft’s commitment to cloud computing is strong, and based on solid economics where Microsoft makes money while the consumer saves cash. It’s a sure sign of where software and solutions are heading — and how the most influential software companies are putting their weight behind the model.

John Cummins, sales and marketing consultant
www.bestquarter.com

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Here, we’ll be linking to and discussing interesting developments in cloud computing, cloud services, software as a service and more.

We welcome your comments and input — so please contribute!

John Cummins, sales and marketing consultant
www.bestquarter.com

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