You may have heard it called ‘everything-as-a-service’, ‘anything-as-a-service’, or the far catchier acronym ‘XaaS’. But whatever your preferred lingo, this subscription-based model is now an inescapable fact of life in the Business-to-Business world.
We’re all familiar with Software-as-a-Service (SaaS), the revolutionary older sibling of XaaS, that allowed software to be accessed through the cloud. It was a pioneering way for businesses to offer their standard solution at a lower, distributed cost of entry, but also meant that customers needn’t worry about weighty upfront costs and long-term maintenance contracts. Of course, over a decade on, this is commonplace, but its influence has now reached plenty of other industries. Through the cloud we’re seeing this model applied at pace to other business offerings and gaining widespread acceptance.
For example, it’s not uncommon to see such ‘as-a-service’ concepts as ‘Infrastructure-as-a-Service (a kind of pay as you go cloud service that offers compute, storage and networking on demand) or ‘Platform-as-a-Service’ (Like IaaS but designed to support the web application lifecycle and provides development tools, business intelligence services and database management systems). Both offer businesses the flexibility to scale up or down as they require and can be instantly updated. Remote and on-demand? It’s no surprise that products, services and experiences are becoming rapidly ‘XaaS-ified’.
Has any of this come as a surprise? Well, no. Analysts were discussing this shift nearly five years ago and predicted that by 2024 the global XaaS market would surpass $340 billion. However, they didn’t factor in a pandemic and the race to adapt business models to gain a competitive edge in a pandemic/post-pandemic world. It makes sense, given the rise of the on-demand economy and the highest ever levels of customer expectation. XaaS applies the principles of ‘servitisation’ which, despite sounding like a corporate buzzword, is a legitimate way to describe the kinds of businesses that sell a continuous outcome, over a single product. Transforming to this kind of model also fosters an ongoing relationship and sense of engagement and collaboration with customers, known to be factors in any successful offering.