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SAAS, major opportunity and threat to traditional software industry experts warn

Software-as-a-Service (SaaS) represents a huge opportunity but also a major threat to traditional software companies, according to Frank McCracken, an industry expert speaking at the Enterprise Ireland Summit in Dublin.

A founder and professional services director of Saaspoint, Europe’s largest specialist developer and implementation consultancy, McCracken said that the Internet had fundamentally changed the rules of developing and delivering software.

“One of the big challenges to traditional software is global distribution. This problem can be solved by using Internet platforms like’s AppExchange which is like an iTunes for business applications. Suddenly companies of any size, no matter how small, have access to a real platform for global distribution.”

He said that Saaspoint had won major international business by using the global shop window that is AppExchange.

McCracken added that SaaS also axes development times for software applications, which is a major issue in an industry where there is a shortage of skilled software engineers. “Traditional software takes months and years to develop and debug. We have been able to develop full blown on-demand applications in 40 days or less, unheard of in the past.”

He said that this is made possible by being able to develop on a stable, scalable Internet-based platform like “This has democratised and depoliticised software development – you no longer need to adapt for underlying or historical customer platform decisions, because the platform is just a web browser.”

McCracken added that Saaspoint was “eating its own dog food” in that every part of the business process was outsourced and on-demand.

”SaaS is a massive opportunity for the software industry because the huge investment previously required for distribution has now gone, and because even very niche solutions can now find viability through a global presence. But it is also a major threat to those companies who do not realise what is going on around them. Even global powerhouses like SAP, Microsoft and Siebel have discovered this to their cost. This marketplace is now about being ‘in touch’ with what your customers want and what technologies are being used to deliver this.

“Without this level of awareness, there will be no relevant innovation and traditional software companies will be left behind.”

Désiré has been musing and writing about technology during a career spanning four decades. He dabbled in website building and web hosting when DHTML and frames were en vogue and started writing about the impact of technology on society just before the start of the Y2K hysteria at the turn of the last millennium. Following an eight-year stint at where he discovered the joys of global tech-fests, Désiré now heads up TechRadar Pro. Previously he was a freelance technology journalist at Incisive Media, Breakthrough Publishing and Vnunet, and Business Magazine. He also launched and hosted the first Tech Radio Show on Radio Plus.