I stopped short in my recent blog post about Open SaaS of expressing what I thought may be the next logical evolution of enterprise software, which is the hosting of free open source business applications with a subscription for expert services and on-demand consulting; ie Service-as-a-Service.

Phillip Lay, from the Chasm Group Advisors, does a great job of articulating this need in a recent newsletter:

"Why has no one until recently been talking about the continuing need that customers have for services to accompany their SaaS investments?  After all, complex problems in business and governmental organizations haven't disappeared, particularly those that require IT in some form or another.  All the emphasis to date on the product delivered as a "service" (i.e., by subscription as opposed to a perpetual license plus maintenance) merely shows how little the software itself "matters" today as the be-all and end-all.  And even if the price of the software portion of the overall "service" goes to zero, customers will still pay for actual services that help them to solve important business and other problems.  The difference will be in the way that services are delivered."

"What is likely to no longer work is the conventional time and materials model of expensive "manual" services, now seen to be highly inefficient unless enabled by increasing use of automation.  What must be made to work is to have virtually every service substantially automated and deliverable online once the service in question has been transformed from a custom, never-done-before, thing to a repeatable and relatively routine activity."

This is akin to HP giving away printers to sell the ink or Gillette giving away razors to sell the blades. Eventually we'll see on-demand organizations giving away hosted applications to sell their systems integration, configuration, or management services.