BANGALORE/ NEW DELHI: The popularity of the on-demand deployment model has increased significantly within the last four years. Initial concerns over security, response time, and service availability have diminished for many organizations as software-as-a- service (SaaS ) business and computing models have matured and adoption has become pervasive.

Some of the key industry trends that are contributing to the rapid growth of SaaS globally include businesses examining ways to reduce their IT capital expenditure budget, the increased availability of broadband which extends the viability of web-based service solutions globally, and the demand from businesses to rapidly implement software which supports a specific business need.

As per estimates , organizations are experiencing project savings of 25 to 40 per cent by deploying CRM applications in SaaS mode. Microsoft being a leading SAS vendor is working with partners to provide customized services to small and medium businesses (SMBs) says Rajesh Kumar, Director Marketing – SMB, Microsoft Corporation India Pvt. Ltd.

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CIOL: What is driving the adoption of SaaS and particularly the Microsoft products among SMBs?

Rajesh Kumar: Microsoft's success with the customers is the result of our deep understanding of the needs of the small and mid-size businesses (SMBs) and based on this understanding, we have developed best of breed products, ranging from the Microsoft Operating System to ERP solutions.

Moreover, we also offer products and solutions that have been specially designed for the SMB segment. The Windows Small Business Server 2003 R2 and Vista, launched recently, offers several editions for different customer segments. Microsoft products bring to the table ease of use, familiarity as well as a lower total cost of ownership.

Our products are taken to discerning customers through our 6000 strong partner network. They enable the last mile of both horizontal as well as vertical functionality and deliver the final customer experience. Our partners work with customers to ensure that from among the wide options available from Microsoft they adopt the technology/ solutions most suited to their business to make them globally competitive.

CIOL: SaaS is looked upon buy different vendors with different approaches. How is Microsoft marketing SaaS to customers?

RK: We , at Microsoft , believe that customers and partners want the best of both worlds, i.e. on-premise or in the box software and the on-line services. They want to be able to choose the options or mix of options that is best suited to their business needs at any given point in time.

So , we take an expansive view of the SaaS model in a hybrid approach that combines software and services. We call this approach 'Software + Services'or Software plus Services. So, the definition of "SaaS " has changed from Software-as-a-Service to Software-AND-a-service.

CIOL: Which business segments and verticals are fuelling the demand for SaaS model in India?

RK: We believe that the SMB segment would be the first to evince a keen interest in the S+S model in India. This has been corroborated by on ground off take. Even among SMBs, those with global ambitions and desire to rapidly improve their business process in an increasingly competitive market will be the leaders in the pack.

Following very close on their heels will be companies that are suppliers to large Indian and global firms eg. – automotive spare parts manufacturers, textile, pharmaceutical industries etc. driven both by the desire to improve bottom-line and also by increasing pressure from their larger partners to streamline the supply chain. In time, we expect that the S+S model will also find takers among larger enterprises across industry verticals.

CIOL: What advantages can emerging enterprise s think of while adopting the SaaS model?

RK: While licensed package software involves deployment of the software on site for the customer, it entails upfront costs as well as investments in terms of getting in place IT professionals for the deployment as well as costs involved in training of personnel.

All these costs are dramatically cut with services model where the software is often hosted and managed remotely either by the partner or the vendor themselves. This affordability as well as ease of deployment and consequent use are some few advantages which the S+S model has over licensed packaged software.

CIOL: Which products of Microsoft has the highest reach among SMBs?

RK: The unique value proposition of Microsoft's products lies not only in their familiarity and ease of use, but also in their ability to be easily customized and cater to the specific needs of different business verticals or segments. While the last mile of customization is delivered through our extensive partner network in India, Microsoft also offers products tailored for the SMBs, which is an important segment for us.

For the mid market segment , we have - 2007 Microsoft Office System, Windows Server 2003 R2, Exchange Server 2007 - designed to meet the messaging and collaboration needs of SMBs, SQL Server 2005 - an affordable option for both small and medium-sized organizations that includes the core functionality needed for non-critical e-commerce, data warehousing, and line-of-business solutions.

Among other products are Microsoft Forefront for Exchange Server, Windows Small Business Server 2003 R2, Windows Vista Business and Microsoft Dynamics.