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« What the Hell is CRM 2.0 (and Where the Hell is Carmen San Diego?) | Main | Another Chapter Rescues A Sunday »

September 02, 2008


Steve F.

Fundamentally software companies think of the world in an on premise view or "cloud" computing view. As a former Lawson employee and now NetSuite reseller the value that is created for customers by providing complex ERP systems on demand is a 4X-10X savings. No wonder Harry doesn't want the model to change.


SaaS will never die is how I see it. Great information in this post, thanks a lot. Keep up the good work.

Chris P


I don't think you can look at profitability the same way when comparing a SaaS-based software company to a traditional software company. For example, the marginal cost of getting another Oracle customer (and I realize I'm _hugely_ oversimplifying this) is the cost of burning, packaging and distribution of new CD's. But with SaaS, it's the ongoing costs of software plus the hardware to run it (and staff to run that and so on).

Craig Klein

Sometimes when someone goes on a rant, they're ranting because deep down they realize the insanity of what they're saying, they just haven't fully accepted the reality that's beginning to smack them around.

Sure, SaaS as a business model has its weak points. However, there are way too many entrepreneurs trying to make a go of it to assume that there won't be further innovations to strengthen those points.

On a macro scale, it just makes sense in terms of the utilization of resources - servers, software, IT expertise, end user hardware, etc.

Oh BTW - I wonder if Mr. Debes has heard of Google... they have what could be argued to be the biggest IT bet ever placed squarely on the SaaS model.

Alexandre Trottier

"Bob Warfield reports that is slightly less profitable on more revenue than Lawson - which certainly jabs Debe's argument in the face."

Are you referring to his argument that SAAS is less profitable? If so, I don't see how you come to that conclusion. If, in fact, Salesforce does make less on more revenue, it proves that they really are inefficient. If the game is maximizing revenue, more from less is better. Can Salesforce increase their margins over time? I think they can, so we'll see.

Brent Leary

Please, Hammer... Don't Hurt 'Em...Too Much!

Paul Sweeney

Ouch. Goin to need a big spoon to eat all the humble pie. :)

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