Ed's recent blurb on the Lotus Notes Hosted Messaging offerings got me thinking. Reading through the comments and seeing Ed's response to Bruce's comment has huge potential. The whole problem, be it MS, IBM or other large vendor's is that they're not ready for it, from a licensing point of view.

SaaS licensing for applications would enable many BP's out there to really offer some innovative solutions, and as that market matures, different xSP's would eventually integrate and share data in the "cloud", (lol.. I was looking for an excuse to use that buzzword).

Unfortunately, I think current licensing arrangements are still a pre-internet quagmire. If an xSP hosts a server and applications for a client already paying Lotus Notes server/client licenses, the xSP would still need to pay it's own license fee to IBM to host the solution. Thereby double dipping licensing fees back to the client. So, SaaS would only really work from a TCO perspective for sites that had no existing Domino licensing.

But there is still another problem. SaaS should allow a client to pick "best-of-breed", (woot! another buzzword), to produce the right solutions mix for them. But in the current arrangements, a client would continue pay multiple licensing costs for each xSP utilised thereby creating a dimishing value of returns as the licensing costs mount up. If IBM could address at least these 2 licensing issues and still make a buck, it could open up a huge market that is well beyond anyone's understanding in terms of size.

So, I think the technology is certainly ready for SaaS. In fact it's been ready for many years, it's a case of whether the vendor's are ready for it.