BANGALORE, INDIA: Industry experts believe that India will play a big role in taking SaaS (Software-as-a-Service) to the next level by going beyond the traditional applications and that a new breed of very niche and specialized services will emerge on SaaS.

"The SaaS market is primarily defined by applications. But, SaaS is evolving quickly into unchartered territories and this where India will play a big role," said Venguswamy Ramaswamy, Global Head - Small & Medium Business, Tata Consultancy Services, Ltd. speaking at the IET SaaS conference in Bangalore.

With growth rates of 38 percent in the APAC region, and the Indian share pegged at 48 percent, Ramaswamy said that the future of SaaS will be defined by how successful service providers are in integrating SaaS with the other major forces of enterprise IT such as Managed Services, Web 2.0 and Service oriented Architecture (SoA)..

Future of Managed Services
There is a huge opportunity for SaaS in remote infrastructure management!

According to Ramaswamy SaaS has a much larger role to play in Managed Services and that the role of security will evolve as business collaboration adds a new dimension with the federated identity management and that SaaS is the answer for federated identity management. . 
Co-relating its potential in as supply chain scenario, he said, "Unless a supply chain collaborates with authentication it increases complexity," and that with security federation, the user should be able to get authenticated using one ID across all domains.

Referring to the importance of technology standards, he said," although available, they do not have agents to connect multi-enterprise security policies."  He said that technology providers do not have the ingredients to provide security services and the agents for different businesses to share credentials, stressing the need for self-evolving networks for multi-domain activities.

On the Remote Infrastructure Management (RIM), Ramaswamy said that India holds 53 percent of the $7 billion market, a huge portion of which can be moved to SaaS using models like federated security.

SOA vs SaaS
"Every large scale SOA (implementation) will use half the services hosted outside" 
 
The percentage of re-use of applications / services has always been a point of contention among users of SOA. Hence, Ramaswamy feels that unless cross-enterprise agents step in and help contextualise re-use functionalities contextually, SOA will be a stumbling block. According to research reports, 70 percent of the large and medium enterprise indicated SOA initiatives in 2007.

With services currently restricted to units within an enterprise, cross-enterprise integration is a challenge. One of the main reasons for RFID not taking off is lack of support of individual best practices. Ramaswamy said, "Many applications do not support serveral indivdual best practices."

He said that the prospects for sharing services with partners was high and that "we believe every large scale SOA (implementation) will use half the services hosted outside." Niche oblique services are expected to emerge complemented by enterprise SaaS.

He said while the supply chain has been the largest SaaS product,  the future of IT lies in how it provides cross –enterprise businesses.

Web 2.0 and SaaS-to take after open source

The Web 2.0 era has seen the Internet forming communities of mutual beneficiaries sharing knowledge. Stating an example to prove a point on how SaaS can deliver a lot more than office suites and accounting solutions to the $30 billion jewelry community, Ramaswamy, said that a key component of the service revenue goes into design acquisition and that designers can build a business model around it by using design software and SaaS acting as a broker to deliver complex graphics on the Web.  This way, designs can be shared and is open for innovation, while providing an opportunity to eveolve the Opensource gateway for SaaS apps.

Ramaswamy noted that service providers will have to target niche solutions because business applications supply would get saturated and that aggregation will be a key customer value. He said,  "SaaS will have to prove business networking collaboration and explore software services that do not have a user interface," like in web services for security management. He advises service providers to architect multi-tenancy in a way that it shares data for business collaboration while maintaining security.