The Global Transformation to On-Demand

Why the world is moving to subscriptions and what it means for businesses.

By Tien Tzuo, Zuora

It’s one thing to catch the wave of a new trend early. It’s another to be part of the team that started it all. In the summer of 1999, at the crest of the dot-com era, I was fortunate to be one of the first employees to join a company led by Marc Benioff that vowed to change the face of the software industry. That company was salesforce.com, one of the pioneers in the software-as-a-service (SaaS) movement. During my tenure as chief strategy and chief marketing officer, I helped evangelize the vision that we called “The End of Software.” This mantra was our conviction that software belonged on the Internet, not on a CD, and in that process it is transformed from a product that you buy to a service that you subscribe to.

Fast-forward almost a decade to 2008. The world now accepts saleforce.com’s premise as a core tenet. Software as we once knew it is not coming back and SaaS is here to stay.

But that is not the end of our story. I have now come to realize that this transformation has not been restricted to just our software industry. All around me, everywhere I look, in industry after industry – products are being transformed to services in front of our very own eyes.

Webinar on Thursday:
The Death of the Enterprise Software Buying Cycle?

MR Rangaswami The SaaS business model and emerging ecosystems have fundamentally changed the way business applications work together and are deployed. But what about the sales model? Attend an interactive online panel discussion with M.R. Rangaswami, publisher of SandHill.com, Doug Harr, innovative CIO of Ingres, and executives from Intacct, LucidEra, and WebEx to find out how the SaaS model is fundamentally changing the way companies buy software. This insightful and complimentary webinar will take place on Thursday, May 29 at 10:00am PDT.
Click here to register now!

Desktop Virtualization and You

Virtualization is changing the enterprise IT game for all types of IT. Sarah Friar of Goldman Sachs shares an analysis of the impact on software vendors in this post to the SandHill.com Blog on virtualization.

Publish Your Perspective!

SandHill.com wants your opinions. Send your thoughts on the enterprise software industry to SandHill.com editor, Maryann Jones Thompson (maryann@sandhill.com) and have your opinions published on our site.

Communicating with the Right Investors

Executives spend too much time talking with investors who don’t matter. Read this article from The McKinsey Quarterly to find out how to identify those who do.

News Update: Open or Closed

Megavendors make overtures to the open source community; plus, Microsoft gets "egged", ODF faces credibility issues, open source is in the driver’s seat, and more software news of the week. Read these stories and more software news of the week in the latest SandHill.com Software News Summary.

Poll: The Subscription Transformation?

How will the transition from product to service impact the software industry?
Take our Pulse Poll >>

Last week, readers speculated on the transition to service-based IT.
Give us your opinion and see the results >>

More at SandHill.com:

Cisco gets into open source in a big way.
Read the most important enterprise software industry news of the week >>

Altierre received $8 million.
Monitor the latest software venture capital deals >>

Versata bought government solutions provider Evolutionary Technologies.
Size up last week's software M&A deals >>

Former Senior Vice President at Symphony Services, Nagi Prabhu, named CEO of Aragon Consulting Group.
See who's made it to the top in our list of recent software executive appointments.

Send us your feedback on this newsletter and the SandHill.com site.

Parting Thought

“Your most unhappy customers are your greatest source of learning.”
—Bill Gates

Courtesy of Malcolm Kusher, The Kushner Group

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