Monday, April 25, 2005

Software on demand: small companies still don't "get it"

Small and mid-size businesses (SMBs) should be a fertile market for software vendors such as NetSuite and, that sell software on-demand, that is systems hosted by the vendor and sold on a monthly subscription basis. However, a recent research report by AMI Partners indicates that adoption of software on-demand might take longer than on-demand vendors would like.

The study found that the typical small business averages less than one full-time IT headcount, while the average medium business has five full-time IT staff. So, SMBs ought be welcoming software on-demand as a way to deploy systems without increased need for IT staff. Furthermore, SMBs are growing in their use of the Internet, and most of them already have high-speed Internet connectivity. This means that they already have most, if not all of the infrastructure needed to implement software on-demand.

However, the study found that the majority of SMBs currently have no plans to adopt software on-demand. Why? The study points to a lack of awareness and education concerning software on-demand vendors and solutions.

In my opinion, software on-demand is the way of the future, especially for small and mid-sized businesses. But vendors are going to need to do a lot more marketing and education before adoption reaches a tipping point.

Related posts
Software on demand: attacking the cost structure of business systems

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