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SaaS superstars' cynical sales schemes make them dinosaurs-in-waiting

Quadrant-sketcher says elasticity fibs will produce snap-back of a new buying cycle

Internet Security Threat Report 2014

Distinguished Gartner analyst Robert P. Desisto has offered up an interesting theory: Software-as-a-Service (SaaS) giants are on the way to making themselves so bloated and cynical you'll want to find new sources of software.

Desisto (who we deeply hope has collaborated with someone surnamed Cease) popped his thoughts in a blog post that lays much of the blame for the possible extinction event at the feet of sales people.

“In my experience of reviewing 100s of contracts a year, SaaS vendor salespeople behave just like their on premise ancestors,” he writes. That behaviour sees them ignore the promise of elastic usage and payment models and instead go for lock-in with multi-year contracts that fix prices.

“This means there is no ability for a SaaS customer to pay for what they use,” he writes, lamenting the state of affairs because “This was supposed to be one of the foundational [sic] tenants of SaaS but has rarely been offered because SaaS vendors want large contract lock in.”

Users will enjoy this approach from SaaS players just as much as they enjoy it from vendors of conventional software, he argues.

“However, all it takes is one viable vendor to figure out the 'pay as you go' formula for applications in a market,” he concludes. “Once it happens, we will begin talking about those legacy SaaS vendors tied to a dinosaur business model and the whole replacement cycle will start over again.”

And if SaaS players are delivering on the promise of simple data export as well as they are delivering on the promise of elasticity, that replacement cycle will be a bitter one. ®

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