Companies shift focus to cloud-based software

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It’s no secret that cloud computing has changed the IT game for many businesses by enabling new ways of delivering software. Smaller businesses have benefited from lower initial investments while large enterprises have achieved greater flexibility and easy-to-provision resources. However, a recent Wired article predicted that the cloud will also have an impact on applications themselves.

One of the positive things the cloud may have achieved is raising expectations throughout the technology industry. As businesses realize that many off-the-shelf solutions are quick to become obsolete and may not be a fit for their individual needs, decision makers are finding more value in custom application development.

“The effect this trend will have on the IT industry cannot be understated,” the article stated. “Legacy application vendors are losing their footing in a fast-moving industry that’s all about custom-built, purpose-driven applications that cost a fraction of proprietary solutions. In addition, there’s been a shift in what consumers expect from an application.”

Decision makers are increasingly looking toward the cloud and expecting much more than infrastructure provisioning. A Fall 2012 research report from investment banking firm Headwaters MB found growing momentum for software as a service, particularly in the customer relationship management and human capital management arenas. The worldwide SaaS application market grew from $10 billion to $14.3 billion in 2012 and is projected to grow to $21.3 billion by 2015. Headwaters analysts predicted that this growth will create more competition in the cloud market, and lead to more value from both infrastructure-as-a-service and SaaS offerings.

 

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