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SAAS TAKING OFF BUT….

For all the talk of Internet-based financials starting to catch on, there's evidence that the category is still new for many. Members of the Information Technology Alliance who were hoping for a presentation on VAR experiences with SaaS products couldn’t find any traditional VARs among the membership who had experience selling the cloud. This week, NetSuite CFO Ron Gill told an audience at the Deutsche Bank Technology Conference that "We do still spend a portion of the sales cycle talking about SaaS" and he quickly noted that "Nobody makes an RFP for CRM without mentioning SAS, that’s not true for ERP."

And from SAP, often the target of NetSuite's scorn, came a prediction from chief technology officer Vishal Sikka that especially among enterprise customers "Things five years from now will not be substantially different than they are today". Sikka, speaking at the same conference as Gill said SAP remains committed to a hybrid model. The problem, he believes is that SaaS applications "have been relatively simple, mission critical applications are not [simple]." While many observers believe Internet-based applications will be disruptive, the SAP view is that users don't want disruption and SAP plans a non-disruptive approach. That includes lower costs of on-premise systems through virtualization and making them easier to manage.

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