I have encountered "Burnham's Beat: Software's Top 10 2005 Trends: #3 Software As A Service" post on software as a service and on how the world advanced in the last ten years to better accomodate this software delivery mechanism.
In the last ten years the internet has become much prevalent in our daily lifes and customers fear less of it now - a change that affects strongly customers' acceptance of hosted solutions. Still I see several problems in this delivery mechanism that weren't solved yet although they are on the way to be solved (At least it seems like that):
1) XML Integration - XML has been evolved in recent years and it does provide better interoperability for application, still, enterprise integration depend heavily on specific adaptors for specific products (And sometimes with specific versions) and I am not sure whether we are there yet in terms of being able to connect all enterprise applications via XML. Developing adaptors take a longer time then the framework sometimes.
2) Performance - Indeed we are surfing faster and basic web-based applications look greater then ever - still, rich client applications, which require desktop integration as well as more advanced usage of the local UI resources can not be implemented yet via web browsers. There is always this short delay between my clicks that never happens to me on the my desktop.
3) Security - Was a problem and still is an issue although an issue we know better. Corporate sensitive data that is located in a 3rd party site still embeds potential security hazards.
I do believe in the ease of delivery of hosted applications and the better underlying economics, still I think that currently only some of the enterprise applications' stack are suited for this kind of delivery mechanism.
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