A preview of the April issue of SaaS U Journal:
These numbers are pulled from Softletter's forthcoming SaaS Report. This is the fourth year in a row we've conducted the survey from which the report is based. In the first year, the numbers for mult-tenancy were almost exactly reveresed; nonetheless, the SaaS market grew strongly in this period.
SaaS AND MULTI-TENANCY
Are your SaaS customers served by a centralized data architecture (multi-tenancy) or do you have separate databases for each customer?
Centralized data architecture: 61%
Separate database for each customer: 24%
We provide both options: 14%
Other, please specify: 1%
We think these numbers are important because they contradict a major theme promulgated by many SaaS consultancies and pundits; SaaS systems must incorporate multi-tenancy to be "truly SaaS." As these numbers show, this is clearly not the case; currently, 38% of our respondents either don't offer multi-tenancy or provide it as an option.
Don't get us wrong; we think there are excellent business reasons to incorporate multi-tenancy into your products; the ability to mine that data created by customer interaction with your SaaS system is an excellent marketing reason, never mind the technical challenges of scaling out with a single instance infrastructure.
But there are many markets that don't want or strongly object to "co-mingling" their data in any common or integrated data object. In these cases, many vendors have made a business decision to give their customers what they want and to not concern themselves with religious debates over technical purity. To almost all customers, SaaS is defined by three simple factors:
I don't buy a license for this application.
I don't install it on my hardware.
I pay for in on a recurring business.
That's it. Companies that attempt to redefine SaaS as something more than this are usually consultancies trying to sell something or technical purists who enjoy theological tussles. It's the customer and/or your market that will determine the importance of multi-tenancy in your sales and marketing efforts. For most of them, its presence will simply be a "tick list" item as relational databases became in the 80s, when everyone advertised their DBMS as relational while few customers ever cared (or understood) exactly what that meant.
rick chapman
www.softletter.com
www.saasuniversity.com
By Rick Chapman Managing Editor and Publisher at Softletter
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