Unicorns, Yetis, and SaaS Dangers

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Okay, so toads don't give people warts and if you cross your eyes they won't stay that way. However, old wives' tales concerning SaaS are proving significantly harder to debunk, as Jim Howard, CEO of on-demand content management solution provider CrownPeak, will aver. "Even though it seems as if Salesforce.com and NetSuite are taking control of the market right now, there's still a huge amount of resistance," he says. Many of these misconceptions are taken as fact, especially in the SMB world, according to Howard. To combat this resistance, CrownPeak launched a "SaaS Myths Campaign" that presents and dispels prevalent misconceptions surrounding on-demand solutions. Some of the myths include that security is a problem with SaaS, that the customer loses control, that the solution is difficult to integrate; that it costs more over time, and that the SaaS company competes with the IT organization. "Part of it is just general ignorance," says Jeff Kaplan, managing director at THINKstrategies. Both he and Howard call these ideas nearly 100 percent false, their permeation pinned to propaganda spewed by traditional ISV providers and some IT organizations concerned with threats to their livelihood. Other "myths" include that SaaS solutions have fewer features, that they crash if the Web site goes down, and that the provider may fail since SaaS is a new business model. Although some of these ideas come out of actual occurrences, such as the Salesforce.com outages last fall, for the most part, the facts easily prove them false. SaaS vendors spend more money on security than almost any internal organization, and SaaS services can publish to separate Web-hosting environments. Once industry leaders get past their SaaS fears, adoption will grow even more rapidly, Kaplan says. "In the next couple of years it will not be a question of why I should use SaaS, but why should I continue to buy a packaged application?"
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