SAS on SaaS: This Makes Sense … For The Vendor

Whether business analytics or what SAS considers a lesser technology, business intelligence, will find fortune time-sharing-cum-cloud-computing remains to be seen.A ZDNet report even cited a piece of research from Forrester that indicated business intelligence software would have “minimal success’’ operated as a service in the “cloud.

Whether business analytics or what SAS considers a lesser technology, business intelligence, will find fortune time-sharing-cum-cloud-computing remains to be seen.

A ZDNet report even cited a piece of research from Forrester that indicated business intelligence software would have “minimal success’’ operated as a service in the “cloud.” The ZDNet piece said the move “isn’t expected to get a lot of traction.”

SAS chief executive Jim Goodnight isn’t convinced it’ll be a big business either. He estimates the company pulls in $30 million a year from selling software as a service on the Web and another $30 million from hosting applications and data for customers, a more customized version of this.

That’s a little more than 2% of its $2.6 billion a year software business. Even if software as a service (aka SaaS) and hosted computing continues to grow 35% a year, like they did last year for SAS, it’ll be a long-time, if ever, that enterprise applications and data operating on the Web match that of applications and data operating at the enterprise, he contends.

Still, there are some uses that make sense, he believes. Managing marketing campaigns and … developing drugs are two examples he cites. Maybe it’s the collaboration involved.

Not that selling software as a service doesn’t make sense.

Particularly for a vendor, such as SAS, he says.

Right now, the company’s 200 products have to run on seven or eight different types of servers, from mainframes to various flavors of Unix and Linux servers to Windows servers. SAS’ middleware has to run with Web application servers including WebSphere, WebLogic, Tomcat, and Jboss . And an increasing number of browsers.

“So the number of combinations of hardware that we’re having to test has actually grown incredibly large,’’ he said. “Right now, it takes us longer to test software than it does to write it. It’s gotten to be a huge bottleneck.”

With software as a service, the supplier only has to write for one set of hardware and one set of Web services.

“That’s all we have to do is that one, that one combination,’’ he said.

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