Why Are SMBs Wary Of SaaS? - InformationWeek

InformationWeek is part of the Informa Tech Division of Informa PLC

This site is operated by a business or businesses owned by Informa PLC and all copyright resides with them.Informa PLC's registered office is 5 Howick Place, London SW1P 1WG. Registered in England and Wales. Number 8860726.

Cloud // Software as a Service

Why Are SMBs Wary Of SaaS?

Lack of awareness and uncertainty about managing multiple apps are the culprits according to AppDirect co-CEO Daniel Sakes, whose firm provides an online marketplace for vertical apps.

12 Money Saving Tech Tips For SMBs
(click image for larger view)
Slideshow: 12 Money Saving Tech Tips For SMBs
SMBs account for less than 10% of SaaS usage, according to IDC. Microsoft cites a similar number. With so many companies riding the cloud these days, why are small and midsize businesses so reluctant to make the leap?

Daniel Sakes, co-CEO of AppDirect, thinks he knows why. "Many of these companies don't even know that SaaS apps exist or that they're relevant to their business," he said in an interview. "And those who use SaaS aren't sure how to manage multiple apps."

AppDirect offers a solution that Saks believes is going to "revolutionize the way businesses interact with their applications." The company recently joined the ranks of LinkedIn and Flickr when it won "Best in Show" at this year's Under the Radar conference, which recognizes disruptive players with innovative emerging technologies.

Businesses in any vertical can visit AppDirect's online marketplace to find, buy, and manage applications. Are you a hair salon looking for a Web-based POS program? A law firm seeking a cost-efficient financial management app? You'll probably find it at AppDirect.

The website provides a central point of access for all applications. Companies can do a little "window-shopping" to check out the features, benefits, and pricing of apps before committing to a subscription. They can provision and de-provision users with a few clicks of the mouse; do online invoicing; set up user roles and privileges; and manage multiple subscriptions--all in one place, and all without paper.

Saks said about 80% of AppDirect's customers are smaller businesses (companies with 5 to 100 employees), but the company does draw quite a few Fortune 500 players as well.

AppDirect is just emerging from private beta, and Saks said the company is working hard to recruit channel players--telecom companies, hardware and software vendors, and any other B2B service provider that would offer SaaS to its client base. "Reselling SaaS is difficult, just the way it was for mobile providers to sell apps before the iPhone," Saks said. "We're addressing the pain points."

InformationWeek Analytics is conducting a survey to determine the satisfaction with mobile operating systems vendors. Respond to the survey and be eligible to win an iPad. Take the survey now. Survey ends May 27.

We welcome your comments on this topic on our social media channels, or [contact us directly] with questions about the site.
Comment  | 
Print  | 
More Insights
COVID-19: Using Data to Map Infections, Hospital Beds, and More
Jessica Davis, Senior Editor, Enterprise Apps,  3/25/2020
Enterprise Guide to Robotic Process Automation
Cathleen Gagne, Managing Editor, InformationWeek,  3/23/2020
How Startup Innovation Can Help Enterprises Face COVID-19
Joao-Pierre S. Ruth, Senior Writer,  3/24/2020
White Papers
Register for InformationWeek Newsletters
Current Issue
IT Careers: Tech Drives Constant Change
Advances in information technology and management concepts mean that IT professionals must update their skill sets, even their career goals on an almost yearly basis. In this IT Trend Report, experts share advice on how IT pros can keep up with this every-changing job market. Read it today!
Flash Poll