Will SaaS work?

"As some wiseguy once said, those who ignore the lessons of history are doomed to repeat the seventh grade. Based on that principle, I think I have to nominate the entire IT punditocracy to do exactly that.

I'm departing from my normal Advice Line format because right now I Just Can't Stand It.

We're talking about a subject I covered a few weeks ago in Keep the Joint Running ("Trend, fad, or blah blah blah," 2/13/2006), but many of you don't subscribe to that, and it's something you should know about. Which is that a lot of the current gushing about Software as a Service (SaaS) makes me think our industry is doubling as a home for amnesiacs.

If you read an article on the subject at random these days, you'll read that It Must Be Real, because SAP is getting into the game. That's where the amnesia sets in: Not one of these geniuses remembers Pandesic - the ASP joint venture between SAP and Intel that launched with a splash a few years ago, and which both companies abandoned when it didn't pan out, leaving a bunch of customers in the lurch.

Sad to say, not one other commentator in the industry has connected the dots to ask the musical question, "Given its history, why does SAP's entry into the SaaS marketplace legitimize it?" Last time it abandoned its customers to a frog-march conversion. What about this time?

I'll leave it to you to decide whether there's enough difference between ASP and SaaS to be worth all the fuss. (No I won't - the difference is about as significant as what happens when you put different shade of lipstick on the same pig.)

This being Advice Line I ought to include some advice with the commentary, so here it is: If, for some reason, you decide to risk it anyway and use SAP's shiny new SaaS offering, negotiate the following terms into your contract: "Should SAP decide to close down this service, it will either (a) continue to provide it, with the regular upgrades promised in this contract, for a minimum of two years following the date on which it announces that it plans to terminate the service; or (b) it will provide funding, systems integration staff, project managers, and all hardware and software required to convert to an in-house-hosted alternative."

Think they'll go for it?"