Software as a Service (SaaS)

Development vs. Delivery Platforms for SaaS

A new study by McKinsey & Company published this week talks up the impending battle between SaaS development and SaaS delivery platforms.

The SaaS development platform is essentially a turnkey application development platform, including runtime, database, hosting, development tools, common UI, hosting, etc.  Companies in this space are Force.com, Bungee Labs, Longjump, Coghead, and likely many others to come.

The SaaS delivery platform combines all the element necessary to deploy and administer a SaaS offering, and solve many of the ornery and expensive elements like billing and metering across multiple offerings, single sign-on, service provisioning, service monitoring, infrastructure scalability, application integration, etc.  This is a great option for APs who have made a commitment and investment in their application and don't want to re-write.  Some players in the industry today are OpSource, Amazon (EC2 and S3) although this is not a complete offering, and likely to be others as the hosting providers in the market realize that simple Linux or Microsoft hosting isn't enough and they move to offer more valuable and integrated services.

Assuming for the moment that you see the market evolving in this way as well, what path would you take?  Do you see something different?

Any Good Channel Models for SaaS?

While I'me not sure I would call it a dirty little secret, the lack of a solid channel model for ISVs who make an investment in taking a SaaS offering to market is conspicuously absent.

Many are trying, the current influx of Platform-as-a-Service (PaaS) vendors is one such example, vendors like Force.com (www.force.com), Boomi (www.boomi.com), Longjump (www.longjump.com), and the list goes on and on.  PaaS vendors solve a very thorny problem, particularly for start-ups who have the benefit of a blank canvass upon which to work.

But where do you go from there?  You've made a decision to build on a platform that gives you the infrastructure you need to get started and run a service, but without any customers who really cares what platform it's run on.

What role should the PaaS vendor play in helping companies with SaaS offerings find customers, if any?  You'd think that in exchange for the virtual platform lock-in they would do more to help their customers be successful through lead management, market awareness, mashup or composite application support, etc.

What about other channel models or simply a path to the end customer - the one who pays the bill? 

• The direct sales model?  Depends on the solution, but generally too slow and expensive for the long term, and doesn't generate the kind of scale required (with some notable exceptions).  However, much of the B2B side of SaaS is still sold this way.
• Systems Integrators? Perhaps.  Microsoft will undoubtedly have some success selling Exchange and Sharepoint through the SI and hosting community because the administration and customization side of Sharepoint, and a cottage industry has sprung up around Salesforce.com to help with process design and implementation, but nothing too dramatic.
• Partnerships?  Likely one of the most compelling options, but one that has yet to gel in any significant way.  Imagine partners joining forces and resources to address similar target markets with complementary offerings?  Sure, lots of details to work out, but might be a great option to explore.

What else is there?  Any thoughts or great examples?