Why are we really moving to SaaS and Cloud Computing?

If you're an accountant interested in the latest in technology you've no doubt heard all of the hullaballoo surrounding SaaS and Cloud Computing. Why is their such a big stink about moving to the Cloud? The answer is really quite simple. Consider what a friend from Adobe recently told me, for every copy of Adobe CS4 sold in China there are 5 books purchased on how to use it. It's become too easy to find registration codes and have a pirated version of the software that you never paid for. This means that software companies are losing billions of dollars a year. In addition, if you buy a copy of software you really like and never want to upgrade to the next version the software company also loses. How is their value added for the software company? The revenue stream that helps fund development and innovation is gone. This means that software bought at the store is quickly going by the way side. Software in a box is a dead for software companies. The only real way to turn software back into a revenue generating tool is to move it to the web. Charge for the software OR allow free download/use through a browser. You're now paying for a subscription to the software and it does not reside on your actual desktop. Of course, the option to install on your desktop will be available but you won't have the full functionality of that piece of software. Now where's the value added? Here's where it gets really exciting. Software is going to end up being simple yet robust. What happens now is the option to "tweek" the software the way you want it. You can download various applications that will pull or import data from your application. (see my post from 10/8/09).

In our next blog we'll be talking about the pros and cons of SaaS and Cloud Computing.