On Demand in 2006

eWeek has been doing a series called "Innovations 2006 Analysis," in which it takes in-depth looks at technologies that will have great impacts in 2006. One of the technologies they highlighted was On-Demand Software, or Software as a Service.

The attention paid to SaaS sometimes confuses me a bit--SaaS has certainly been possible for 10 years now (my previous company, Energy Interactive, had a successful product called Energy Profiler Online, which has been sold as a service for nearly a decade).

So why the attention now?

The underlying technologies are now available that make SaaS better able to compete with traditional software offerings. The biggest difference between 1996 and 2006? High bandwidth internet availability. It seems archaic to think about now, but when we began selling EPO to electric utilities, one of our big concerns was the time it would take their users (who were often connected to the net via modem) to download the graphics we used for buttons!

Another change: the quality and security in OSs/web servers/databases/etc. No matter what platform you're talking about, great strides have been made in the security and quality of service available from the underlying tools. Microsoft's initial forays into these areas (early versions of IIS, NT, and SQL Server) did not provide the quality necessary for vendors to guarantee quality of service; the open-source community had some decent tools but were nascent at the time. In the ensuing decade, both camps have made significant improvements--Microsoft's tools have improved dramatically, and the open-source community has continued to improve Apache, MySQL, Linux, etc.

But I'll add one more innovation that has made SaaS a viable alternative to traditional software delivery: distributed computing. Key technologies have emerged in the last couple of years that make it easier to scale software across many machines; as noted in my previous post here, scalability is one of the keys to providing software online.

Back in 1997 when we were writing EPO, scalability was one of our biggest concerns--there was no easy way to take the compute intensive operations inherent in the software and distribute them across many servers. We had to write that code ourselves. It was laborious work, and it wasn't really part of our core competency at the time.

Nowadays, products like the Digipede Network make distributed execution easy. Instead of spending months hardcoding solutions to allow their software to scale, SaaS developers can write a few lines of code that add inherent scalability to their product. That, in turn, enables people starting SaaS companies to spend their programmer dollars adding features to their software. They end up with a product that not only has a better feature set (because they spent more time and money on it), but is also more scalable and robust (because they aren't using a jury-rigged solution for distribution).

2006 may be the year of SaaS--but if that's true, than it's the year for distributed computing as well.