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SaaS leads other cloud services in adoption, spurred by mobility

The most popular cloud service on the market is Software as a Service, and channel resellers say the success is driven by mobile users who need quick access to business applications anywhere.

An increasing number of larger businesses are embracing cloud-delivered software applications to automate core business processes, driven in part by the need to support telecommuting workers using a larger variety of mobile devices.

IT solution providers involved in integrating and customizing software as a service (SaaS) say the allure of SaaS is its promise to reduce upfront capital expenditures. Many businesses have been emboldened by the success of pilot projects and pushed by the need to support workers that are spending less time in centralized headquarters offices.

“Mobility and SaaS go hand in hand,” said Andrew Lawlor, president and chief architect for Aptaria Inc., a cloud services integration firm based in McLean, Va. “Once employees realize they aren’t tethered to their headquarters and can get access wherever they are, it is a natural progression.”

The biggest challenge to enterprise SaaS adoption is in regards to where to store and manage data, Lawlor said. “It doesn’t help to debate customers about this,” he said. “Rather, you need to work on ways to keep that data on premises and support the rest in the cloud.”

Research released by Yankee Group Research Inc. in July 2011 found that remote connectivity was the top motivator for deploying SaaS within enterprises, cited by 47% of large companies. In fact, over the next three years, mobility is expected to encourage 38% of enterprises to move at least half their applications into the cloud, Yankee Group predicted. Currently only 11% of enterprises name mobility as their primary driver.

“We are going to see so much more as iPads and other tablets evolve and mobile applications evolve,” said Tricia Bennett, senior director of adoption and learning for Bluewolf Inc., a business consulting and SaaS integration firm based in New York City. “The more acceptable and simple the interface, the more adoption you will see.”

Fortunately, that means plenty of integration and development opportunities for IT solution providers that have the skills to help integrate SaaS seamlessly with on-premises software. That is because integration is a major obstacle to SaaS deployments, according to new research from consulting company ThinkStrategies Inc. and cloud integration company MuleSoft Inc.

A joint survey conducted by the companies found that more than half of SaaS customers (52.8%) need integration help. According to the data, integration is also considered to be the most time-consuming part of customer implementations.

“As SaaS adoption rises and as the number of SaaS providers continues to increase, issues with integrating these applications will remain at the forefront,” said MuleSoft Vice President of Marketing Mahau Ma in a statement about the research. “SaaS/cloud vendors have to understand that the integration responsibility now rests on their shoulders, not the end users, and will become a significant inhibitor to their business.”

The most important areas for software integrators to focus on when it comes to SaaS deployments is workflow and how the application fits with existing processes, said Bennett. Especially within an enterprise environment, that might entail the development of custom modules that more closely reflect a company’s specific processes, she said.

“You are never really done with an implementation,” Bennett said. “You need to look at what is next and what can be done to constantly make things better.”


SaaS not for every business and application 
Joe Balsarotti, president of Software to Go, an IT services company in St. Peters, Mo., that serves small businesses, said few of his small clients are interested in the SaaS concept. One of their worries is ownership: Few of them are willing to pay a monthly fee in perpetuity for something that will never be theirs. Balsarotti said. “They ask me, ‘Why wouldn’t I just buy the application outright?’”

Another drawback is that some rural areas in the communities that Software to Go serves still have questionable broadband Internet services, Balsarotti. The one major solution his clients are willing to place in the cloud is backup and recovery, for the obvious reason that it makes little sense to maintain copies of backup files in the same place as primary ones. This argument became simpler after the devastating Joplin, Mo., tornado.

“Disaster recovery in the cloud is the one application that really makes sense to my customers,” Balsarotti said.

About the expert
Heather Clancy is an award-winning business journalist in the New York City area with more than 20 years’ experience. Her articles have appeared in Entrepreneur, Fortune Small Business, the International Herald Tribune and The New York Times. Clancy was previously editor at Computer Reseller News, a B2B trade publication covering news and trends about the high-tech channel.

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