SaaS seeks definition with help from SIIA

The US software industry's leading advocacy group has launched a much-needed initiative to define some key metrics around SaaS. Building on work begun at the SIIA as much as a year ago, the SaaS Executive Council launched yesterday (PDF of release here) and will be rolling out its programs over the coming months covering four main strands:

• Marketing and communications — spreading the word about SaaS to end users, ISVs and channels. This team is also working on a "TCO framework" for comparing traditional perpetual license software to SaaS. I wish them luck.
• ISV best practices — probably the most-needed initiative of all, if my postbag is anything to go by (see my previous post, Acceptable screen refresh for on-demand apps, for example). The group is promising papers based on research of existing best practice across a wide range of topics: "business model, pricing, lead generation, code architecture, infrastructure delivery, and more."

• SaaS and the channel — looking at how third party integrators and VARs can work with SaaS providers and make money from the relationship. I'm glad to see this much-overlooked topic firmly on the SIIA's agenda. Coincidentally, I'm participating in a a webcast on this very topic next week with Jamcracker, one of my consulting clients.
• Legal and contractual — specifically service level agreements, an area where many providers are all at sea. It's one of the first things an industry body ought to be looking at — and preferably raising the bar considerably from where most providers are today.

The launch of this group is a welcome sign of further momentum for SaaS and is another step towards maturity for the emerging industry. I'm pleased to see too that the leading lights are vendors who understand the on-demand model: the founding members include salesforce.com, WebEx and Intacct, along with hosting providers OpSource and Navisite, consulting group ThinkStrategies, IBM and Keychain Logic. Let's hope it stays that way.

One of the dangers of this type of group is that vendors pile in as an easy way of being seen to be on the bandwagon of an emerging trend. The result is that the group gets skewed towards supporting the status quo as larger vendors exert influence to support their own agendas. I saw this happening with the ill-fated ASP Industry Consortium, which launched in May 1999, only to disappear (following the example of most of the rest of the ASP industry) in 2002.

Naturally, I mentioned this when I spoke yesterday to Nick Blozan, who has been named chair of the new SaaS Executive Council, and whose day job is SVP sales and marketing at OpSource. He told me he was optimistic the group won't be overrun by legacy 'dinosaur' vendors.

"The beauty of it is you have a predominance of companies that really want to promote the SaaS model," he said. "There are so many companies ready to understand the model, they want to make sure there are best practices out there. There is a widespread desire among the vendors to create some kind of consistency and help the model mature."