XaaS stands for Anything as a Service (or more accurately X as a Service). Software as a Service (SaaS), Platform as a Service (PaaS), and Infrastructure as a Service (IaaS) offerings have ballooned in the past few years, and with them came a new flood of ideas on what to monetize next. Databases as a Service (DBaaS), Disaster Recovery as a Service (DRaaS or BDR), and Networks as a Service (NaaS) expanded on the original fixed platforms (among countless others). If it could talk to a network, and more and more things could, it could be outsourced.
Anything can be a service. Everything can be a service. Different services can be packaged up and delivered as a new service. The possibilities are endless.
The proliferation of more and more powerful, internet connected devices and the penetration of broadband internet lead to a market ripe for service offerings. The general business trend to reduce volatile costs for analytic and metric driven business further pushed these offerings into the limelight. Managing an on-premise server for an application could be costly for the Total Cost of Ownership (TCO) for any given application. Certain offerings required server grade workstations which had to be upgraded regularly as well as licensing costs per station and/or user.
SaaS was one of the first to really make the news as a new term, but PaaS and IaaS had long since existed in a more limited scope, but platforms like AWS and Google Apps Engine pushed them into the spotlight and opened the scope up. As these platforms grew and grew, what they could offer and support became better and better. Virtualization technology peaked and there were many mature virtualization solutions which could host these platforms. Microservices and similar concepts lead to easier to produce, release, and maintain products which could flesh out more and more offerings.
Where Is XaaS?
XaaS is everywhere. SaaS, PaaS, IaaS, etc. all have a general focus of what they offer, but once technology matured further and the market saw what could be made by offloading services for a standard cost, everything got a service. As providers grew, the side offerings grew too.
Pretty much any task a company requires someone to be hired for will have a XaaS offering. Don’t want to maintain a database person? Pay a DBaaS firm or an even higher level abstracted service company. There are companies which are literally just a combination of XaaS offerings stitched together with a face in front of them. I know of an MSP which outsources their onsite, help desk, sales, accounting, and marketing departments. They don’t need HR or anything inhouse at that point.
What Does XaaS Bring to the Table?
XaaS works on the same principle as insurance. The XaaS provider offloads the unpredictable infrastructure and delivery costs by averaging them over many different individuals. The pooling of resources reduces the TCO for the XaaS provider which is passed on to the customer to make the business viable.
A company may run an application which requires a person full time to maintain, but a single person can maintain multiple stacks for a SaaS provider which drives down the TCO. The payroll costs, training costs, risk of not having the person, etc. are all mitigated by outsourcing a given application as a service. This makes a lot of sense for business critical systems where internal infrastructure cannot keep up.
The price tag tends to be a bit higher or the feature set a bit sparser than traditional offerings, but the advantages of not having to maintain the backend which is unpredictable can make far more accounting sense. It also means not having to maintain staff, or scale staff, around a given solution. There is one price which is consistent, and the human element is abstracted away.
What Does XaaS Do Wrong?
Any kind of infrastructure outsourcing means trusting someone else with your data, and there is always an associated risk. A chain is only as strong as its weakest link, holds especially true for security. The more potentially faulty points, the more likely one is to fail.
XaaS aims to try and level the unpredictability of operating a business, but this leveling also limits the business’s natural growth. It’s easy to add a single piece of infrastructure at a time with a predictable service cost, but what happens if it doesn’t work out? What happens if another service does everything you add a piece at a time for at a lower cost? What happens when your services cost more than a small, inhouse maintenance team does for your use case? The cost is predictable, but it’s like a CD, you’ve traded risk for guarantee. You get a given service for a given cost, but it might be cheaper to do it differently, and if you’ve bought in too far, you will struggle to escape.
You are also at the mercy of how competent a vendor is, and whether or not they manage to stay in business. If a XaaS business goes under, what do you do? For certain things, you can jump to anyone else, but for other things, it can be a bit harder.
What Does XaaS Mean for a Business?
Volatile costs can be normalized. The overall cost may go up, but the monthly and yearly costs will be more predictable. XaaS also means that many facets of a business can be offloaded in part or whole leading to more focus on core competencies. This can mean certain paths to growth are cut off as well. This doesn’t matter for elements of the business which will never have focus, but too much reliance on a process may preclude other avenues.
XaaS is a balancing act of what a company wants to grow in and what it doesn’t want to think about. Accounting probably won’t matter to you if you have no plans to expand into anything even tangential to finance, but certain technologies and competencies can be paramount to success in a given sector. Outsource what doesn’t matter or what is too volatile and keep what defines your business. It can be possible to be a middle man to these services, but it’s a very temporary existence for any given platform.
If it can be delivered remotely, it will be. More and more services will be abstracted into their own sector of XaaS as the service economy grows. It’s not just tech services outsourcing anymore. Janitorial services, accounting services, HR services, and more have already been abstracted and outsourced. The power of numbers and risk reduction means basically anything a person or business needs can be outsourced. What can you do when you take out the pieces holding you and your business back? When you don’t need to even think of it, it’s invisible for better and for worse.
Originally published at https://somedudesays.com.