SaaS sales being hit by short term view of costs from users

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SaaS sales being hit by short term view of costs from users

Simon Quicke

A short-term attitude from customers towards costs is undermining attempts by the channel to sell the TCO benefits of software as a service compared to the traditional on-premise options.

That was the conclusion from a roundtable organised by FAST Ltd, which specialises in keeping firms on the right side of software licensing laws, with those selling into the market frustrated by the response some customers were taking to arguments around long term savings.

"More often than not, customers look at the price of SaaS versus a perpetual license and see that it is more expensive and don't consider the services elements such as installation, nor do they think about what hardware the software will run on," said Ian Moyse EMEA channel director at Webroot.

"Effectively they don't look at at all the components that make up the true cost of the on premise solution," he added.

One of the problems is that IT departments are being called on to deliver immediate savings rather than deliver reductions over a period of months or years.

"TCO is usually viewed as a one-off activity, whereas in reality it should be measured throughout the product lifecycle," said Steve Strassburg, strategy leader for business process and industry at IBM.

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