Monetizing the Cloud

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Monetizing the Cloud: Assessing Billing and Payment Providers

Document:                        SSR-661
Date of Publication:            November 5, 2009
Number of Pages:              36
Lead Author(s):               M. West
Price:                               $1,295.00 USD (Single User License)

Report Overview: Billing capability is a critical ingredient in business success and sustainability in the Cloud. Effective billing and payment solutions are essential in enabling monetization, providing agility in competitive situations, managing the channel, and reducing operational costs for any Cloud services provider.

The need for effective billing and payment solutions is the foundation of the latest research study from Saugatuck Technology Inc., titled “Monetizing the Cloud: Assessing Billing and Payment Providers,” which focuses on the need for, and roles of, billing and payment solutions in all aspects of Cloud Computing, from the foundational technology layers up through SaaS and Cloud platforms and ecosystems.

In examining this highly fragmented market, the study profiles solutions of eight Cloud billing solution providers, some of them Cloud-based solutions -- Aria, Monexa (formerly IP Applications), OpSource, Vindicia and Zuora -- and some on-premise software solutions -- Metratech, Parallels, RevX.

One thing is certain: You cannot monetize it if you cannot bill for it.

Press Release / Media, BLOG and Podcast Coverage:

11-05-09 Saugatuck Assesses Cloud Billing and Payment Solutions

Executive Summary:

Monetizing the Cloud: Assessing Billing and Payment Providers
(Freely available. Registration Required)

Read this report to learn:

	What are the critical, core tenets of pricing that Cloud providers must adhere to in order to succeed?
	What are the seven key attributes that best describe and categorize the capabilities billing and payment solutions?
	Where, and how, should billing and payment solutions fit in a SaaS or Cloud services provider's ecosystem?

Research Highlights:

	Successful SaaS pricing is all about understanding the customer. It must appeal to the customer intuitively and must seem fair. It must show immediate returns to the customer and promise future value. Finally, while appealing to the customer’s perception of value, it must also align with the SaaS provider’s business model.
	The most effective SaaS pricing exploits a pricing metric that relates to the value the user perceives. Key question: “What is the metric that best captures the value being delivered?” Equally important is the resulting subscription fee at different volume points along the pricing curve.
	Billing, administration and related marketing capabilities are essential in meeting the new operational challenges of a Software-as-a-Service business. ISVs in transition to SaaS can overlook the complexity of what is required to support SaaS billing, a much more complex set of processes when compared to most on-premise software environments.
	Saugatuck expects to see SaaS providers move more and more aggressively to court channel partners – both traditional and next-generation. Their efforts will include programs that offer relatively high margins (usually in the 20-percent range or higher), billing support, and electronic marketplace platforms to enable partners to connect with other partners and build end-to-end, domain-specific solutions.

Six Years of Saugatuck On-Demand IT Research:

Saugatuck began surveying and analyzing on-demand IT in 2003, publishing our first report on the subject, “Pay-As-You-Go (PAYG) IT: Where's the Business Value?” in April 2004. Our first global, SaaS-specific user executive survey and vendor interview/briefing program was executed in early 2006, with our analysis published in the April 2006 ground-breaking report, “SaaS 2.0: Software-as-a-Service As Next-Gen Business Platform.”

Table Of Contents:

	Summary and Research Findings
	So What?
	Saugatuck Insights
	Introduction: The Importance of Billing
	Pricing and Billing in the Cloud
	Providers in the Ecosystem
	Assessing Cloud Billing Providers
	Net Impact
	Vendor Impact
	Appendix A: Research Methodology
	Appendix B: Participating Vendors
	Appendix C: Features and Capabilities Lists

List of Figures and Sidebars:

	Sidebar: What is a Rating Engine?
	Sidebar: Cloud Pricing Considerations
	Figure 1: The Saugatuck Cloud Ecosystem Model
	Figure 2: Eight Cloud Billing Providers and their Target Customers
	Figure 3: A Fragmented Market - Solution Origins

Related Research:

Coming Soon

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