Warren Suss

ANOTHER VIEW—Commentary

Warren Suss | At your service

Corporate America is replacing traditional buy-and-run-your-own IT application models with software-as-a-service, and the government will be next.

There are strong business case justifications for the move to software as a service. System upgrades are free. The direct cost per user is lower. The total cost of ownership is lower. These savings reflect reductions in software costs as well as efficiencies based on outsourcing support functions. There are reduced requirements for staff. By using on-demand software, application development and implementation times are shorter. And when important applications get into the hands of users earlier, users are able to get program results sooner. The total-fixed-price-per-user, on-demand software model also reduces risk in the budget planning process, which is often just as important to agency decision-makers as total-cost-of-ownership considerations.

Who is best positioned to deliver the next generation of federal software-as-a-service solutions? Carriers dominate the wide area space up to the service connection point, and the integrator owns the turf from the service connection point to the keyboard. But in the commercial space, it's been specialized companies like WebEx, SAP and Salesforce.com that have been playing in the brave new world of on-demand software. And the new powerhouse content providers such as Google and Yahoo may be as well-positioned as the carriers or the integrators to move into the emerging federal market sweet spot for software-as-a-service.

I don't know if the winners will be carriers, integrators, or the new content and application providers. But I do know that the competitive battlefield is changing. The ultimate winners will be the companies who will make IT services a more powerful, more cost-effective tool in winning wars, sustaining peace, responding to national emergencies and making good on our nation's promise to deliver results to the American people.

About the Author

Warren Suss is president of Suss Consulting, a federal IT consulting firm headquartered in Jenkintown, Pa.

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