Thank you much for this informative article.

The software business has changed and will continue to change rapidly over the next few years. As you mention, the software vendors were/are relying on the initial licensing fee, maintenance fee and upgrade fee. This is the software model. I think this will continue to change with SaaS. Especially, since SaaS demands less hardware requirements versus the traditional desktop software applications. Even if one would argue that SaaS licensing fees are close to the traditional software licensing fees, still the fees for SaaS would be much less due to the minimal hardware requirements. In addition, how many times does the enterprise purchase software apps, put them on the shelves and not use them. Or even how many times does the enterprise only use a small portion of features in the software app. Yet, the enterprise user pays for the entire software bundle (even for features he/she is not using). That is why I think SaaS will continue to outgrow traditional software packages.

Arsen Pereymer
Chief Technology Officer
eCompetitors, Inc.
http://www.ecompetitors.com