Pay-As-You-Go Is Up and Running

摘要

It's Back To The Future for Siebel Systems Inc., a maker of customer-management software. On Oct. 1, Siebel announced it would start selling a version of its software as a monthly rental service delivered via the Internet. Strangely enough, Siebel killed a similar effort three years ago because it couldn't figure out how to make money. Today? That software is one of the keys, Siebel executives believe, to turning around a two-year, 25% slide in the San Mateo (Calif.) company's revenues. "At the time, this wasn't really a market," says Ken Rudin, vice-president of Siebel CRM on Demand. "Times have changed." Look for more of the software industry's heavy hitters to jump on the soft-ware-as-service bandwagon. In the late 1990s, a host of startups began offering applications delivered over the Web. Most of them went out of business, mainly because large corporate customers balked at the idea of allowing untested outsiders to run their most important applications. But in the past couple of years, both corporations and smaller businesses have become more comfortable with this way of buying software. Analysts now estimate that over the next half-decade, as much as half the software sold to corporations will be paid for on a monthly basis, as part of a long-term contract or a monthly rental fee, or even on a pay-per-use basis. So rather than paying millions of dollars for software they might not get much use from, businesses can pay by the drink. "It is a much more financially reasonable model for customers," says Joanne Cor-riea, a vice-president at market researcher Gartner Inc.