Independent software vendors are looking at the software industry and realizing that it is changing rapidly. From software licensing we are now talking about SaaS/Software + Services. What does this all mean? Before we attack the subject in this latest blog, I wanted to congratulate all readers who came up with iTunes as the answer to my previous blog. Many of you provided comments and as Christopher Painter pointed out in his comments there are many other aspects of software licensing that do not go away simply because you are using a SaaS or Software + Services deployment model. The list that we could come up with is very long, lets toss out just two examples to illustrate the various aspects of the software business you might want to be thinking about as part of your SaaS / Software + Services strategy.
Many SaaS services have code that is downloaded by the web browser that then enriches the user experience. These might be ActiveX objects, DLLS, visual controls or Java code that is critical to the user experience you are delivering in the service. How are those files going to be installed on the various user desktops? The browser does a basic job but many independent software vendors find that they are forced to replace that installation experience with one that is more compressive and capable of dealing with all the nuances of thousands and thousands of machines. Is your service targeted at an enterprise market? If so the desktop environment at most enterprises is pre-configured and locked down.How is the IT organization going to be able to get all the various downloaded components of your service installed and included in the desktop image? How will enterprise IT keep that collection of components current?
But what does that mean for software licensing? How about we move away from the technology and look at a business example. As we all know, some geographies or markets are effectively owned by VARs, SIs and distributors. So what is the role of the channel in the services component of a software + Services or SaaS solution? You can go down the path of trying to separate the customer from a channel partner or you can craft your services with the idea of the channel in mind. As early as possible can you have a vision in mind that accounts for the channel? For example, can your channel partners combine your services with others that do not compete but deliver something unique for that market? How will that create value and cash for the channel partner and open your solution to new markets?
SaaS and Software + Services is the latest evolution in software with previous transitions being client / server, distributed computing, mainframe / PC and so on. I think the thing for all of us to remember is that with every transition that has occurred in our industry, the various aspects of the software business changed, but they didnt go away. We have some great conversations and design efforts underway around the role of software licensing, installation, and application repackaging in SaaS and the services component of Software + Services. I would welcome the chance to include your thoughts in our conversations both internally as well as here on the blog.
If you have some thoughts please let us know!