The problem with many technological advances is they throw you into a huge learning curve and are often fraught with compatibility headaches. But, as Helen Bradley explains, pay-as-you-go software is changing all that, making the technology in your business more transparent and trouble-free, with no capital outlay.
Like a spotty teenager, pay-as-you-go software has been through a rough adolescence but is now maturing into a fine example of the best that technology can offer. For SMEs this is good news. With the new software purchasing models, small business has a chance at last to get the software it needs at an affordable price.
Instead of huge capital expenditure on boxes of product and the hardware to run it, software of the future will be purchased like any other utility: by the month and, in many cases, according to the amount you use.
Cost is obviously one of the advantages of renting software or obtaining it as a delivered service online. There is little or no hardware required to access Software as a Service (SaaS), other than a desktop computer and internet browser, so set-up costs are low. Typically there is little configuration required, so you won’t need an IT professional to set it up and the pay-as-you-use model gives you an out if you’re not satisfied: don’t renew the contract, and find another vendor. Since you don’t have a big investment in either hardware or software, changing vendors is simple.
Another benefit of SaaS is that it’s typically scaleable, so if you find you need more people to use the software you can add users very quickly—there’s no further upgrading of licences, for example. Automatic upgrading is another benefit of SaaS as the company supplying the software to your business takes care of updating it. You don’t pay for the upgrades, you don’t even have to make them happen, you just focus on using the product and let someone else worry about keeping it running.
Available Software
There’s a wealth of SaaS offerings available right now and plenty more on the horizon. The quintessential SaaS application is Salesforce.com, the on-demand CRM application that made it acceptable to deliver software online. It can be trialled online and, if you like it, you’ll pay for it on a per-seat basis as you need it. Given the continued growth of Salesforce.com and the wide acceptance by users of the on-demand, pay-as-you-go software model, the company recently launched AppExchange, where products developed for small businesses can be trialled and used in just the same way as Salesforce.com is used.
AppExchange is currently host to some 188 SME applications, ranging from expense management to industry solutions for real estate, manufacturing, and professional services. “To date we have had nearly 100,000 test drives and 4,400 installed applications and there’s more on the horizon, with some 200 independent software developers participating and over 15,000 developers working with the product,” says Doug Farber, vice president of operations for Asia Pacific Salesforce.com. He encourages SMEs to visit AppExchange (www.salesforce.com/appexchange) and trial an application. “These applications are designed to help you tackle business issues without having to deal with technical issues. You don’t have to worry about compatibility with your hardware, installation or the cost of buying the program; you get the productivity you need without having to employ technical expertise to get it running,” he explains.
Citrix Systems also has some interesting SaaS remote access products for SMEs. These include GoToMyPC, a tool for accessing a computer remotely using just a web browser and an internet connection. GoToAssist is a corporate sector product used for remote support applications. Typically it might be used by a company offering support services to other companies or by a help desk in a company to provide support to users in branch offices. GoToMeeting is a web-conferencing application designed to support internal and external company collaboration. Users can share a computer desktop during a conference call so they can, for example, view a worksheet or PowerPoint presentation, or work collaboratively on a document. This product is sold on an ‘all you can meet’ basis, so you pay a flat monthly fee and can use it any time and as much as you like. The corporate version of the product allows for up to 25 people meeting at a time.
“Applications like GoToMeeting increase productivity, decrease time spent travelling to meetings, and save money. The ROI for this application can be significant,” says HR Shiever, Citrix Online’s managing director for Asia Pacific.
According to Shiever, there are significant lifestyle benefits to using SaaS. “The benefits of products like GoToMyPC are that they allow for flexible work-days,” he explains. “You can leave the office in time to pick up children from school and later in the evening do a couple of hours work using your home computer to access all the programs and files on your office computer.
“These products are very secure,” he adds. “GoToMyPC, for example, is secured by end-to-end encryption and you can even create one-time passwords to allow safe connection from public computers. Because you can configure it so all data is stored on your work computers, this will be backed up with the rest of your data, eliminating some of the problems of users carrying the only copy of important documents around on laptop computers.”
Software Security Systems
Other solutions in the pay-as-you-go space are managed security services like that offered by Network Box. Here the benefit to a business is it will get better security than it would if it were managing the system itself through simple economies of scale. The Network Box product creates a secure perimeter around a business with its internet firewall, a VPN to secure the internet link between an organisation’s computer network, anti-virus gateway, anti-spam and spyware filtering, as well as web content filtering and internet intrusion detection. The system is configured to your specifications and then tested and installed. Network Box then manages the service, updating it as required on a 24–7 basis, with product pricing dependent on the hardware model chosen, not the number of uses.
For businesses unable to afford the capital cost of buying the Network Box hardware, partners like Firewall Systems provide the hardware and ongoing service in a financed bundle that can be purchased over a period of time for a monthly fee. Andrew Tune, director of Network Box Australia, says security is a big issue for any business. “These days, it’s not possible to have good security without paying for it, but it doesn’t have to be hugely expensive. Security is an already complex issue which is growing in pace and complexity daily. Most businesses can’t manage it effectively in-house and yet it needs attention 24–7. For example, in 2005 we updated the service, on average, 164 times a day. By outsourcing security to a professional security service, small business can get the security it needs at an affordable price.”
Future Software
Microsoft is also moving into an online delivery model as an option for businesses. Its new Microsoft Office Live products are website and web collaboration tools for SMEs and are being trialled in the US. Microsoft Office Live Basic is a free service, funded by advertising, which provides an SME with site hosting, a domain name, and five email accounts. It’s aimed at businesses needing a website and a way to bring disparate email addresses such as hotmail accounts under the business’s direct control.
Microsoft Office Live Essentials adds more than 20 collaborative tools for managing customers, organising and managing employees,
project management, sales and marketing, and company administration to the Basic service. Each subscribing business gets up to 50Mb of password-protected space, and the ability for up to 10 users to access the tools using just a web browser. The business data is backed up automatically every day, the products are easy to use and site security is managed as part of the service.
The third product is Office Live Collaboration, which is the collaborative tools component alone. The pricing for these two services when they go live later this year, will be USD$29.95 per month, making it an affordable way for a business to access useful small business tools without any up-front capital outlay.
As Tony Wilkinson, director of information, worker group, Microsoft Australia, explains, “At Microsoft we understand that not all small businesses are the same, they have different needs, different approaches to technology and different views as to what technology can do for the business. We want to give small businesses a range of choices from applications the small business manages itself, to those hosted by channel partners and others, like Microsoft Office Live, that are hosted by Microsoft itself.”
Microsoft is also offering finance for some of its products, including the new Microsoft Dynamics CRM 3.0. In addition to being able to buy this software outright or rent it from a service provider, it can be financed by Microsoft Financing. The point of difference for Microsoft is that, unlike traditional financing services, Microsoft Financing can cover the cost of the entire solution including hardware, software and the ongoing services—most traditional companies will finance the hardware but have difficulty putting a value on software and services.
So the overall message for SMEs: there are more options than ever for getting the software tools you need at a pricing that suits. The trend towards paying for software as it is used or through rental will, in future, shift much of the cost of software from an up-front expenditure to an ongoing one and that can only be good news for your business.
