Software as a service has nested comfortably in the local market, placing the country at the head of global concerns banking on the ASP model in their search for cost-effective business applications.
Taking flight in these favourable conditions is Progress Software`s ASP solutions from partner MIP, helping to make Progress Software the second largest ASP contributor for Progress worldwide.
"Customers are in a tailspin over costs and management complexity while vendors scramble to increase overall product and services revenue, develop long-term income streams and develop customer loyalty," says Richard Firth, CEO and chairman of MIP.
Research firm IDC says: "Applications management or software as a service can be a complementary solution to both customer and vendor challenges. In addition, technologies such as Web services and business models such as subscription pricing for software are exposing new opportunities to provide over- and under-served software customers with application offerings delivered as a service."
"MIP has demonstrated a depth of understanding of vertical industries such as healthcare and financial services and of the unique challenges they face, and has the capability to design appropriate software solutions for these industries and to advise how to implement and change these solutions according to business needs," says Firth.
Telemed Managed Healthcare Organisation is one company that has received these benefits, in a market sorely lacking them. "We have grown the business during the roll-out and have capacity for further growth, without increasing the burden on staff and without hiring new employees," says Andre de Lange, IT manager at the business. "MedStar has improved our internal efficiencies in terms of claims processing and contribution management. It has also ensured that Telemed retains its competitive-edge by taking advantage of the latest technology available to fund administration systems."
MIP`s offering goes to the core of the values Progress stands for, a joint go-to-market strategy that focuses on shared risk and reward, a fundamental component of the definition of software as a service: invest in your partners and business knowledge and you will be able to drive your businesses forward jointly.
"This new model has become accepted practice in SA precisely because of the value customers are seeing. Profits from locally developed MIP applications in the financial services, medical administration, property investment and pension fund sectors have grown enormously over the past three years, and MIP has taken its applications to the global market. We expect the upcoming launch of life insurance administration system to perform equally well, if not better," says Firth.
Rick Parry, MD of Progress Software SA, says: "Our partnership with MIP, and their entrepreneurial approach to software as a service, has been the foundation for our success in this rapidly growing alternative to the traditional software licensing model. Our prospects for the forthcoming year should result in a further 100% revenue growth from this segment of the market."
Globally customers spent $2.3 billion on the software as a service market, according to IDC. The research firm expects spending to grow by 28% compounded over years, reaching $8 billion in 2007. The IDC statement goes: "This growth has been fuelled in part by customer demand for low-cost, rapidly implemented solutions to their business process problems. In addition, vendor offerings have matured."
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