I spent a few minutes yesterday talking to a VP of Engineering here at Citrix and we were musing over the fact that hosting applications to the masses will most likely have a growth curve that mirrors broadband over the past 10 years. In my past life at AT&T and Nortel Networks we used terms like “homes past” to describe the potential for broadband services. There needed to be critical mass of available IP pipes in order to provide a ubiquitous service offering to the masses. In fact, one might say that the demise of the Applications Service Provider (ASP) back in 2001 was directly correlated to the penetration (or lack thereof) of broadband because without broadband availability, servicing customers with productivity applications was impossible.
For those of you old enough to remember, think how hard it would be to squeeze a Power Point slide (let alone a whole slide deck) over a phone modem. Well there’s been a lot of water under the bridge in the past 10 years. According to an FCC report published back in 2008 broadband access rose from a meager 4.1 million subs in 2001 to a whopping 100 million in 2007.
So what does this have to do with IT as a Service and hosting applications to the enterprise? Well it starts with the Small and Medium sized businesses. All of that bandwidth above is now available to all of the SMBs at a very reasonable price. With all of the hype around Cloud Computing the SMB customer has an interest. In fact, today (according to a recent report from Microsoft) while 65% of SMBs are using some form of hosted applications, only 7.7% of all SMBs worldwide use IT-as-a-Service for support through Hosting Providers. According to the report over 70% of these same SMBs have an interest in this higher order service. That means of the 50+ Million SMBs in the world, 36 million have an unmet need.
That represents billions of dollars of revenues as businesses migrate from their existing plan to a hosting plan. Can you see why hosting IT-as-a-Service starting with applications on-demand will follow the same curve as broadband for adoption? I can!