Can you imagine a world where anything and everything is available via an “as-a-service” model? It turns out, we’re not as far away that reality as some may think.
If you’re reading this blog, you’re likely very familiar with Software-as-a-Service (SaaS) and other “as-a-service” cloud computing models. Many claim the future of SaaS lies in Everything-as-a-Service (XaaS). We agree, but also see XaaS as having an even greater impact and think it is important for entrepreneurs to understand how XaaS may apply to their own companies.
Think of today’s blog as XaaS 101. A primer on:
- What XaaS is
- Where it came from
- Where XaaS is now
- Why XaaS matters to your own business’ success
What is XaaS?
The X refers to “anything” or “everything” as a service. XaaS has frequently been used as an umbrella term to encompass SaaS (Software-as-a-Service), PaaS (Platform-as-a-Service), and IaaS (Infrastructure-as-a-Service).
“From its early origins of SaaS, the cloud-based on-demand services category has evolved into anything-and-everything-as-a-service that isn’t nailed to the floor. XaaS is the essence of cloud computing – a smorgasbord of utility-based offerings that can be consumed on a per-seat, per-month model, depending on usage,” explains Lesley MacDonald, Programs Manager at Dell EMC.
Dan Rahko simplifies the definition of XaaS as “basically any technology delivered over the Internet that used to be delivered onsite.”
Where did XaaS come from?
Executive IT industry veteran Howard M. Cohen explains, “the original definition of cloud computing document from the National Institute of Standards and Technology (NIST) lists three cloud service models:
- Software as a Service (SaaS) — Enables consumers to use the provider’s applications running on a cloud infrastructure.
- Platform as a Service (PaaS) — Deploys consumer-created or acquired applications onto the cloud infrastructure.
- Infrastructure as a Service (IaaS) — Provisions processing, storage and other fundamental computing resources to deploy and run operating systems and applications.”
As more and more “as-a-service” models began to emerge, a 2014 IBM article concluded “we can be said to be heading into the ‘X’ as a service or ‘XaaS’ era.”
How did we get here?
In a nutshell, we got here by the convergence of several major technology innovations:
- This thing we call the Internet, that actually works flawlessly now
- High speed networks and broadband that are just about everywhere and pretty darn cost-effective
- Server virtualization that has dramatically brought down the cost of powerful computing
Today, it’s clear we’re in the era of XaaS, and Everything-as-a-Service is poised to become even bigger in the coming years.
Benefits of XaaS
When speaking about XaaS as it relates to cloud computing, there are a number of benefits:
- Lower costs.
- Flexibility. This also includes easier scalability.
- Maintenance is done by the provider. This frees up the customer’s resources and allows them to focus on what they do best.
- Easy access to new technologies (which are being developed rapidly).
- New business services are able to debut quickly (think weeks instead of months).
- Allows for quick responses to market developments. “With constant availability to resources, data and other services through XaaS, businesses can respond in a faster way to any change in the business environment and enjoy better profit figures,” explains Rick Blaisdell, CTO at Motus.
Where XaaS is now
Yes, you read that right. We’re at a point now where XaaS extends beyond cloud computing.
At Chargify, it is clear to us that the subscription economy is not only here to stay, it is growing and changing buying patterns. All of this leads to XaaS as ANYTHING as a service, not just cloud computing.
MacDonald mentions Uber and Lyft as examples of transportation-as-a-service, but many car manufacturers are also embracing transportation-as-a-service models.
GM recently launched Book by Cadillac, a luxury subscription service that allows subscribers access to “a Cadillac of their choice whenever they want it.” The vehicle is then hand-delivered by a concierge. The subscription service currently has a price tag of $1,500 per month, and is in beta in the New York market.
Car companies like GM are being forced to innovate and find ways to “sell” cars to an audience who doesn’t view vehicle ownership as a necessity…or even a desire. The percentage of people aged 16 to 44 who have driver’s licenses “has been decreasing steadily since 1983,” reports The Atlantic.
There are a number of reasons subscription models appeal to consumers, and millennials in particular. GM hopes Book by Cadillac can entice consumers with a fleet of luxury vehicle choices and the convenience of not having to worry about a car loan (or lease payments), insurance, vehicle maintenance, mileage restrictions, or being locked into a long-term commitment.
Even baby monitors are entering the “as-a-service” and subscription model!
The Nanit baby monitor is a new league of smart baby monitors — it tracks and analyzes your baby’s sleeping patterns.
“If you’re also willing to pay Nanit $10 a month (by joining their month subscription service) you can access Nanit Insights, which unlocks the camera’s ‘computer vision.’ Think of it like the NSA for infants — it monitors how your baby sleeps, noting total sleep time, wake time, and times you come in the room. Then it crunches those numbers using an algorithm and shoots out a report you can scan in the morning on the app,” explains Dave Baldwin.
There is also a Nanit Insights Unlimited subscription service for $30 per month:
Parents are clearly thrilled with the “monitor-as-a-service,” based on customer reviews and sales. According to Nanit, the “first 6 batches sold out” and they’re currently accepting pre-orders for future shipping fulfillments.
What’s next for Everything-as-a-Service? Arkessa predicts “XaaS could kickstart the Smart Home in the coming years by evolving the household appliance purchase model from a one-off transaction to an Appliance-as-a-Service relationship between consumer and retailer or manufacturer.”
We agree that is certainly in the realm of possibility, and expect to see a myriad of more traditional industries and non-subscription products pivot to include “as-a-service” in their offerings. Consumers and businesses are embracing the many benefits of the subscription model, and businesses should be looking at how to incorporate XaaS into their own roadmaps for future success.