Advantages and disadvantages of online software for businesses

In 2015, we were 1 billion connected professionals worldwide according to a recent IDC, Emergence Capital study. Uses have been revolutionized by the arrival of mobile devices and the democratization of broadband Internet, which has enabled white-collar workers to move around while increasing their productivity. According to the same study, there will be 2 billion of us accessing our work tools via the Internet by 2025.

The race is also on for SaaS software publishers, whose revenues will top $100 billion worldwide this year. This represents an increase of 21% in one year, according to Forbes.

If usage and technology are taking over from the Full-Web, this raises a number of questions in terms of data security, spending and internal organization. We answer them here. You can also read our other articles on the challenges facing IT services.

Online software: cheaper and more flexible

Online software - known as SaaS, for Software as a Service - is consumed on demand via a subscription fee per user per month. In contrast, traditional software installed on each workstation is acquired via a license. Subscriptions and licenses are the tip of the iceberg, and on this point SaaS is more expensive than licenses. On the other hand, subscriptions cover 70% of the costs involved in setting up the software, whereas licenses only cover 10%. Licensed software therefore has hidden costs that the buyer does not expect:

In addition to costs, which are one of the key factors in the decision-making process, user usage is playing an increasingly important role in the choice of a solution. Indeed, they have a direct impact on productivity. SaaS software also makes it easier to manage a user base:

Permanent access to your applications and data is not guaranteed by Web applications without an Internet connection (moving, train, plane…). However, with an Internet connection, they offer an average availability of 99.8% of the time. This is far more than with installed software, which suffers more regularly from bugs and downtime.

Finally, not all software is available as SaaS, such as graphics-intensive video-editing software. Installed software is also losing out on unified communication and collaboration solutions, which make perfect sense online. In short, trust SaaS for all software except graphics.

Security and confidentiality: the real challenge of the Cloud

Recurring incidents of mass data hacking and government surveillance are undermining the credibility of SaaS. However, data security and confidentiality should not be confused. They are two quite distinct notions. Security concerns the availability and integrity of data, while confidentiality concerns the right to use it. Here’s a breakdown of these points:

State spying is no longer a secret, and it’s true that if your data is hosted in the U.S., you’ll be subject to the rules in force in that country (nb: the Patriot Act). However, many solutions are hosted in Europe, with less invasive legislation. appvizer, for example, lets you choose where your data is hosted.

On the other hand, the lack of security in cloud solutions is a myth for the vast majority of them, for one simple reason: a company can’t secure its data as well as a cloud service provider whose full-time job it is to do so. Furthermore, the loss or theft of data stored on USB sticks or computers is eliminated by secure Internet access. The Achilles heel of traditional software security lies in the way it is used, and the lack of control exercised by IT managers.

Custom development, the bête noir of SaaS

Application customization is a very important topic in this comparison between online and on-premise software. Many companies express this need because their business requires highly customized software.

SaaS software does not require any specific development, as all the publisher’s customers share the same application. It is probably on this point that some users will turn to local installations. On the other hand, most SaaS applications are highly configurable (fields and interfaces can be modified). There are, however, cases where a client company asks the software publisher to carry out a specific development. This request is generally accepted if the publisher believes that the functionality will be of interest to all its customers.

Web applications work differently, and this is why specific developments are no longer topical. APIs, a kind of secure open door in a web application, enable SaaS applications to communicate data with each other. It is therefore possible to build an information system by combining several SaaS, without any specific development.

The most popular online software in France

Here are the most popular software categories in France in 2018:

1. ERP
2. Project management
3. CRM
4. Customer support
5. Time management
6. Payroll
7. Marketing intelligence
8. Emailing
9. Quoting and billing
10. Accounting

Conclusion

Online software is a performance driver for businesses, perfectly adapted to the new constraints of users and companies alike. The replacement of non-browser-based solutions is unavoidable, except for a minority of companies that need customization or software that requires a lot of local resources.

In terms of confidentiality, we can see an area of improvement, which should become a reality thanks to the commitment of major cloud computing players such as Salesforce, Google and Miscrosoft.