News Feature | December 29, 2016

Software Vendors Adapt To Changing On-Premises Opportunities For 2017

Christine Kern

By Christine Kern, contributing writer

Cloud Machine Learning

New technology approaches augment declining on-premises software opportunities.

As technology continues to redefine the way businesses operate, software vendors are adapting and redefining themselves to meet this changing landscape. According to IDC, the market for SaaS and cloud software will exceed $100 billion in the next two years, and SaaS is set to become the dominant model of application consumption for 80 percent of organizations by 2018.

With the rise of as-a-Service solutions, customers now have the ability to terminate software licenses and maintenance contracts in favor of subscriptions, as well as shift from owned hardware to rented infrastructure leading the traditional software market to transform or be left in the dust, according to a Technology Business Research study.

2017 Software Predictions found many traditional vendors have begun to develop their own cloud solutions to retain customers, execute on repositioned core assets, with incremental adoption of software-defined networking (SDN) technology, and layered analytics across enterprise functions.

Among this year’s predictions are:

  • BYOL models will marginally support 2017 license and maintenance sales, but by 2022, 25 percent of remaining software licenses will be deployed off premises. TBR Research found only 23 percent of cloud adopters purchasing licensed software are deploying those licenses on premises, a figure anticipated to drop throughout 2017.
  • SDN Displacement of traditional networking solutions will fail to take place in 2017 as vendors remain in a period of technological advancement and business validation. The report states, “Expect 2017 to remain a messaging year, as vendors validate various technology and business use cases and leverage customer success stories to drive mainstream adoption over the long term.”
  • Unifying business data, layering third-party data and lacing analytics through robust applications will resonate with enterprise adopters. TBR anticipates 2017 “will see the messages of smaller vendors adapting to this trend with networked, analytics-enabled business platforms, including Birst and Domo, resonate with the market as enterprises look to unify their business data to create a single source of the truth and gain insight from analytics that span various business functions, rather than a single department or data set.”