Real deals on on-demand SaaS

By Mark Everett Hall
February 09, 2009 9:12 AM EST
Journalists are probably mostly to blame. We get tired of using the same term repeatedly, so whenever even a pseudo-synonym crops up we latch on to it like thirsty souls in a vocabulary desert. That's why you often see software as a service equated with on-demand software in blogs (guilty) and elsewhere.

But they are not really identical. SaaS can be an on-demand service, but seldom is. It's mostly a subscription service with extended time commitments like your cell-phone provider offers. True on-demand software over the Internet is SaaS, although it's much rarer to find. Like your cell-phone company, subscription SaaS vendors want to lock you in for as long as possible. On-demand SaaS vendors take their chances, which means their service better be pretty good because you can leave them with little financial penalty.

Every now and then I come across a bona fide on-demand SaaS company. For example, Projector PSA Inc. in Bedford, Mass. has an on-demand service for its project management application. According to Steve Chong, chief operating officer, the service gives you all of the benefits of an on-premises tool like Microsoft Project, and more.

For example, not only can you manage all of your project's schedules, expenses and such, you also can match the right people with the right skills sets with their availability before you begin a given project. Plus, you get an online collaboration module to facilitate discussions about the work and personnel involved.

However, according to Chong, given that some projects are simple and short, committing to a two or three year subscription to Projector makes no sense. So the company prices its services per user, per month, per module and you can add or drop modules and users anytime and you don't need to make any commitment for any length of time. And as a bonus, you get a 30-day free trial that you can simply rollover into a real ongoing project.

It's a rare, real deal on-demand package.

Similarly, LiveOps Inc. in Santa Clara, Calif. has a SaaS-based call center technology. Setting up the service is a bit more complex than signing up for Projector. But it's faster than building out your own call center. It took West Marine Corp. of Watsonville, Calif. a mere three weeks to get its operators ready to go, according to Matt Wise, senior director external customer at West Marine.

But the cool thing is, despite having scalable capacity far beyond anything his company would need (LiveOps claims its system can handle 100,000 agents at a time), West Marine and other LiveOps customers only pay by the minute. That's right, the minute, or so says Azita Martin, LiveOps vice president of marketing.

Paying by the minute is my kind of on-demand pricing.