LinkedIn Twitter Facebook

Ben Kepes is a technology evangelist, an investor, a commentator and a business adviser. His business interests include a diverse range of industries from manufacturing to property to technology. As a technology commentator he has a broad presence both in the traditional media and extensively online. Ben covers the convergence of technology, mobile, ubiquity and agility, all enabled by the Cloud. His areas of interest extend to enterprise software, software integration, financial/accounting software, platforms and infrastructure as well as articulating technology simply for everyday users.

More about Ben here.

3 responses to “Disruption is in the Minds of the Users”

  1. Kelvin Hartnall

    Interesting post Ben. I just thought I’d add a comment here as to why I concluded that Xero fails to be a disruptive technology despite the market acquisition data. Xero’s market acquisition data is evidence that the acquired customers are coming from an underserved market. But I’m not sure that is sufficient for it to be disruptive. For a technology to be disruptive, the incumbents need to allocate their resources to other projects and fail to meet the competitive threat. This often occurs if the technology is much cheaper, has lower margins, and fails to meet the requirements of the main market. Incumbents dismiss the area for capital investment when attributes like these exist. So a classic example is the PC which disrupted the mini-computer market; even though the mini-computer incumbents could see what was happening, it never made economic sense to them to invest in this market before it was too late.

    With Xero, it is a more expensive offering than purchasing a desktop accounting system such as MYOB or Sage. If Xero are able to maintain their pricing, then they will have very good margins. Therefore it would make sense for any well run incumbent to put capital investment into a similar SaaS product. So that is why I have concluded that Xero isn’t a disruptive technology, and I predict that we will see some credible attempts at competition from the incumbents.

    As for predicting new disruptive technologies, the following are my predictions:

    (i) Internet video streaming to disrupt TV broadcasting.
    (ii) Cellphones to disrupt the digital camera market.
    (iii) Solid-state drives to disrupt hard-disk drives.
    (iv) A low-cost electric city-car to disrupt motor-vehicles.

  2. Vincent

    Ben,

    I would argue that most of what we see today are existing applications that have been SaaSified. This is hardly disruptive. You mentioned Google docs, and I see that as taking MS Word and simply porting it over to the Web. Sure, it offers distinct advantages such as the ability to collaborate. But I don’t feel it is disruptive.

    When we think of disruptive behavior in the SaaS space, I think we should focus on the paradigm shift in the way software is delivered instead of the shift in usage. I see disruption in revenue streams of businesses, disruptions in how buyers conduct due diligence, disruptions in how software is designed moving forward.

    But as far as usage goes, nothing really sticks out for me.

    Vince
    MHelpdesk, Service Management Software

  3. NYC924

    That was a great post and the perception is exactly why there is a tremendous amount of confusion defining the differences between an ASP and SaaS. People are just making thing up. I recently joined a networking group called “SaaS” and I have to say that I was utterly stunned by some of the content. One in particular was a self proclaimed expert asking if it would be ok to call his new software “on-premise SaaS!”

    What is going on!?