enterprise software business models: moving beyond one-time or subscription

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I read an interesting article in the Bessemer Cloud Computing guide today about alternative business models for SaaS companies.  The article talks about the possibilities of using the data and attention assets generated by SaaS applications for monetization.  One model they mention is ad-supported leadgen applications, like Mint.com in the consumer finance space.  The other they write about is selling aggregated data/best practices/competitive benchmarking – “Insight as a Service.”

I think more and more services are going to move in this direction – affiliates/lead gen and “data as an asset.”

Each of these models has its challenges.

Affiliates must be solid offers, as any purchase through the website becomes part of your product experience (as the good people at Zynga have found out.) Mint got this one right, but I could definitely see a lightweight SaaS financials application for small businesses and projects (and great integration with PayPal and lots of APIs… ) making good money off affiliates.

This ad-supported model seems to work in IT as well – Spiceworks, for instance, gives away an expensive-looking piece of IT software in exchange for your personal information, which it sells to marketers.  (For reference, an ad on a site for IT pros will run something like $80/cpm and you can buy individual leads for ~$70. )  Spiceworks has over 70,000 customers, so it seems people like free more than they hate ads.

My Prediction: almost all enterprise applications (’3-letter acronym’ – CRM, financials,etc) for small businesses will be cloud-based and ad-supported in 10 years.

The other model, the idea of “Data as a Service,” is also extremely intriguing. Here, customers pay for best practices, benchmarking, and intelligence around the service.  This model has become very popular with metrics services, but there are markets like human resources software where this could work very well. Scoble thinks this is Twitter’s model.

The one problem with this model is that scale and distribution are required before the data is valuable, and thus, before revenue.  So the service must be very valuable in its own right, which is why it’s such a great model for web analytics. Flurry is a mobile company doing the same thing as well.

What new business models do you find interesting?  Leave a comment…