The number of independent software vendors (ISVs) is exploding and is expected reach 1 million by 2025, according to Forrester. This trend is fuelled by cloud including software-as-a-service (SaaS), which is lowering barriers to selling software. For example, ISVs can rapidly develop software and market it via a cloud marketplace instead of cumbersome on premise delivery models.
That’s good news for line of business managers, who can use cloud-based ISV solutions to quickly and effectively achieve their digital transformation goals.
Adopting SaaS offerings from ISVs is a relatively risk-free strategy, because SaaS isn’t overly expensive. It also gives organisations more freedom when it comes to the technology underpinning their businesses. It allows them to move away from expensive, hard-to-upgrade on-premises solutions and on-premises infrastructure that requires upgrading and maintenance.
Importantly, businesses using SaaS can take advantage of the most recent, advanced features and functionality at no extra cost. That’s because SaaS is continually updated and ensures businesses are using the latest version. By contrast, monolithic, on-premises software installations often remain in place for years before requiring an expensive, disruptive upgrade.
It's no wonder, then, that legacy software vendors are moving to a SaaS model. We expect them all to turn at least one of their products into a SaaS offering, building a new SaaS service, or acquire a new SaaS company by 2020. And we expect all new software entrants in the marketplace will have a subscription-based solution in their portfolio.
But with so many ISVs offering SaaS, how do businesses choose one that meets their needs?
The answer depends partly on the ISV’s maturity. Organisations should find out whether its technology is proven in similar vertical markets and tailored for vertical markets. Does the ISV provide in-country resources, rather than supporting customers from a remote overseas office? And will it provide ongoing support?
They should also check whether the ISV has a channel model. That will allow it to partner with companies offering complementary products, resulting in a more robust solution.
It’s also important to look for an ISV that has a strong product roadmap. This should be underpinned by research and development capabilities, support and coding. The ISV should also have also had funds or backing to enable continued growth and to keep supporting and improving its product.
Staying loyal to legacy, on-premises solutions is no longer an option for most businesses. While there will always be a place for some on-premises data storage, sticking to on-premises deployments will mean missing out on upgrades and support in the future.
So, organisations should start examining which systems they can move from on-premises to the cloud, and which ISVs can help them get there.
Lee Welch is ANZ director of cloud services at Ingram Micro, and executive council member, ANZ channel community, CompTIA.