2008 - The Breakout Year for Niche SaaS ISVs
I'm not going to attempt to predict the future, but I believe 2008 will be the year of the Small Vertical (intra-vertical focused) and Niche Horizontal (spanning only a few, related verticals) SaaS ISV. The headline producing SaaS ventures in 2007 were the big players, with horizontal offerings. These were Salesforce.com (CRM), Business Objects (BI), and NetSuite (Office Productivity). Just as in the deployed world, "big" horizontal applications are the same ones that have traditionally received the press. And 2008 will not be much different.
Small ISVs that until now have remained in the "deployed" software and traditional licensing game will begin to break out. I predict that 2008 will see the largest influx of vertically focused and niche horizontal SaaS offerings to the market to date. The future of SaaS (the long tail, if you will) is the Small Vertical and Niche Horizontal products and tools. These will be new tools, tools ported from "deployed" solutions, and internal tools utilized by technology services organizations they would like to productize.
The problems I wrote about in my articles in early 2007 regarding selling SaaS solutions to the Enterprise for the most part still hold true. Sure, the climate is changing, but many of the objections are still being faced. These challenges are actually a good thing for well-prepared ISVs as they provide barriers to entry for those SaaS vendors that are not ready to overcome them.
In 2008, these barriers will become an even larger part of the story as more and more small ISVs attempt to sell SaaS products to F1000 companies. Large, well-funded, and well-connected, SaaS vendors had to overcome these same hurdles to get to where they are, but had the resources to wait out the market; small ISVs do not have that luxury.
Since I work with companies to bring their vertically-focused and niche horizontal on-demand software and technology service products to market, 2008 will present some interesting challenges and opportunities.
Happy New Year!
Small ISVs that until now have remained in the "deployed" software and traditional licensing game will begin to break out. I predict that 2008 will see the largest influx of vertically focused and niche horizontal SaaS offerings to the market to date. The future of SaaS (the long tail, if you will) is the Small Vertical and Niche Horizontal products and tools. These will be new tools, tools ported from "deployed" solutions, and internal tools utilized by technology services organizations they would like to productize.
The problems I wrote about in my articles in early 2007 regarding selling SaaS solutions to the Enterprise for the most part still hold true. Sure, the climate is changing, but many of the objections are still being faced. These challenges are actually a good thing for well-prepared ISVs as they provide barriers to entry for those SaaS vendors that are not ready to overcome them.
In 2008, these barriers will become an even larger part of the story as more and more small ISVs attempt to sell SaaS products to F1000 companies. Large, well-funded, and well-connected, SaaS vendors had to overcome these same hurdles to get to where they are, but had the resources to wait out the market; small ISVs do not have that luxury.
Since I work with companies to bring their vertically-focused and niche horizontal on-demand software and technology service products to market, 2008 will present some interesting challenges and opportunities.
Happy New Year!
Labels: business, marketing, SaaS, software, technology
This entry was posted by Lincoln Murphy, on
Monday, December 31, 2007.
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