Is SaaS just Hype?

I was chatting to a friend who does me the enormous respect of reading this blog (thanks Ben!). Ben does a lot of things well, but in my opinion, one of the things he does particularly well is being deliberately provocative. So when Ben through out the comment

“is SaaS real or is it just Hype”  & “I don’t agree with what you write, well that’s not actually true, I think you are nearly there with what you write”

I kind of stand back and listen. (you gotta agree comments like this kind of stop you in your tracks)

Ben’s main point was this. That companies that are buying SaaS aren’t in fact doing that. What they are doing is making sound business decisions, decisions that are right for them. They aren’t into the hype, they don’t really care how they get the outcome. They are just trying to meet their business needs, priorities and outcomes.

To this way of thinking, I guess I am nearly there when I said

“By choosing to go with the SaaS model, the CIO also has to do a sales job on the business. “here’s this new thing, it will be better than the old way and you will get that outcome and make / save  XYZ / be more productive / have better customer sat / retain your staff”. You will notice that the language above is the same language as the business uses,” 


“None of this is new, and it’s certainly not rocket science, the channels that exist for SaaS companies are the same as any other software business.”…” My advice, look to how the traditional software companies did it, therein lies the gems of knowledge garnered through many skinned knees.”

Ben then walked me through two examples to make sure I understood. One being a small SME who has the choice to splash $500 (that’s a guess) on MYOB, install it run and populate it or buy Xero for $50 a month, that you can access anywhere and is backed up, always updated for you, secure etc. The second was of his current employer (who is a massive multinational), who take hosted applications from NZ, HR from Singapore, core financials from Europe, hosted email etc. In other words a large SaaS user who in no part of their business thinks that. What they do think is that for every application and business process that they have chosen, they have made the best choice for them.

At the end of the day isn’t what this is all about, business. And in that context, isn’t SaaS just another example of the IT industry creating hype to fuel its growth, IPO and funding needs?

Like I said, deliberately provocative. Thanks mate for keeping it real

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