The success of Google has led to further Web development and the next Web 2.0 wave. Google broke the stereotype of computer relying solely on OS as platform, spearheading the shift to service environment as true platform to challenge the Microsoft-dominated software domain.
Search engine giant Google provides not only search services, but also software similar to Microsoft Office directly online. After announcing its Web-based office software, Google wasted no time in introducing Google SpreadSheet. The possibility of switching from MS Excel to Google SpreadSheet for PC application has Microsoft extremely nervous. Different from previous software, the Google version utilizes the vast powers of the Internet to support various software services. Microsoft currently considers Google as its chief rival.
With Windows Vista, Microsoft launched the next generation in OS and expects to be the worldwide leader in providing MS-OS. However, more and more people are starting to take notice of service-based software, gradually moving away from the traditional method of paying a standard purchase fee. Instead, many customers choose to pay service fees according to usage. This method is called Software as a Service (SaaS) and is fast becoming the mainstream in the software market.
SaaS refers to providing software through a service model. Even though software is currently sold in package form, more and more service models like the Internet or web hosting continue to support service application. Third-party hosting has existed for quite some time, connecting from far ends at lower costs to provide software service. Hosting companies self-develop and maintain software, which is similar to the outsourcing concept of application service provider (ASP).
Compared to ASP, which progressed along with the Web, SaaS is advancing even more markedly. ASP uses software as a service center, while SaaS provides value within the customer’s service environment.
SaaS revolves around the Internet’s ability to offer software capabilities. Aside from convenient usage, it allows for monthly payment or prorated payment. In addition, usage fee can be recouped through ad revenue, reducing the fee and administration cost for customers. The unique SaaS changed the way the software market operates. The idea of licensing off-line software packages as the standard operating model license to improve sales can be combined with the Internet, integrating on/off-line businesses and making SaaS the new turning point in software business.
Challenged by Google, Microsoft is driven to develop a future plan involving on-demand SaaS. In addition, SaaS is the method of choice for international giants Oracle and SAP. After merging with Siebel, SAP initiated its SaaS business. To bring about salesforce.com, SAP has announced its intention to provide third-generation SaaS solution with the support of its R&D personnel and fellow partners.
SaaS will swiftly enter the market and expand rapidly, creating an architecture and open platform that is based on the software needs and price criteria of each user and allows customers to experience trial use. These features are quintessential to Web 2.0. Along with the development of the Web and trend toward a Web 2.0 model based on open platform, SaaS will revolutionize the way software businesses are run.