Transforming Your Software Product Into a Service

Transforming Your Software Product
Into a Service
A white paper by Accelerance & OpSource, Inc.

Introduction There is growing market demand for more economical and efficient enterprise applications to an ever-expanding global market. The combination of the ubiquitous Internet and the availability and legitimacy of open source software is creating substantial opportunities and economies for software vendors to deliver Software as a Service (SaaS). Software as a Service is a model in which the software vendor provides an rdInternet hosted version of their application (in house or at a managed 3 party site) that is accessed by customers from the website and paid for on a per-use, per-project or subscription basis. Salesforce.com is a leading example of the SaaS model. The SaaS model offers significant benefits to software vendors and their customers. The SaaS model offers customers cost-effective subscription-based or per-use pricing, eliminating the need for substantial capital outlays to purchase perpetual software licenses. It also eliminates the initial outlay and on-going costs and risks of installing, supporting and maintaining in-house hardware and the associated IT staff. In addition, user access and application performance can be dramatically improved with Internet-based, on-demand, 24x7 systems. The SaaS model opens new markets to software vendors. Established software companies can broaden their market reach by offering SaaS solutions to small and midsized enterprises. Other benefits include the financial advantages of predictable recurring revenue streams and strengthened relationships with customers. Software vendors migrating to or developing products from the outset as SaaS offerings will have a significant competitive advantage when competing with traditional license-model vendors. Realizing the benefits of the SaaS model may require fundamental changes to a software vendor's business model, software architecture and operational structure. This white paper provides an overview of the issues associated with the software application itself and the development considerations associated with moving to a SaaS model. Time is of the essence. As with any new business model, the rewards often go to early market entrants. Salesforce.com has broken down the barriers to the SaaS model, and many others are following. Accelerating time-to-market is critical to your business success. Outsourcing product modifications to implement your SaaS offering, with the assistance of an expert services team, and engaging an optimal on-demand service delivery firm will accelerate your time-to-market and insure an on-time, on-budget, on-scope implementation.
Page 2 . Transforming Your Software Product Into a Service . ©2005 Accelerance and OpSource, Inc. The Challenge of Transforming Your Software While there are a multitude of benefits in providing Software as a Service, traditional software companies may face challenges in moving to this model. First, your software must be web-enabled with all functions carried out by the user using a web browser. If you have a client-server application, you must replace the functionality implemented in the client with HTML, and possibly other technologies (XML, Java, etc.), that can be displayed by a web browser over the Internet. Next, in order to gain operational efficiency, your software needs to be multi-instance. You move from single-instance to multi-instance by loading multiple copies of your software on a single set of servers. Multi-instance enables you to share the cost of a server across multiple customers. This will move you to the red line in the following diagram and allow you to offer SaaS. Additional productivity enhancements and economies may be gained by moving to multi-tenant SaaS, or replacing proprietary commercial software with open source software. Web services provide an opportunity for integration with other applications and data flows.
MultiTenant
Single Web Multi CompleteOpenInstance Enabled Instance SaaSSource Offering
SOA
Your code needs to be at least Coding efforts past the red line drive multi-instance (at the red line) additional cost out of the business, to deliver your software but are not required initially toas a service (SaaS) deliver software as a service (SaaS)
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