A revisionist history of B2B software goes something like this:
- In the beginning, customers bought shrink-wrapped software from salespeople at software vendors.
- In the beginning, vendors made their money on service contracts. Vendors knew that contract signature essentially guaranteed predictable revenue and good economics.
- Then, Salesforce came along. B2B SaaS was born. The world changed.
- Now, customers buy access to SaaS platforms, not shrink-wrapeped software.
- Now, vendors have much more sophisticated economics, with higher upside for winners.
- Now, vendors are not selling those nice service contracts any more, but are still looking for predictable revenue -- and often hunting for silver bullet to guarantee their economics.