Aside from low prices, it's also cash flow and up-front loading of risk and money of traditional, on-premise projects that are driving more buyers to SaaS offerings.

In an economic downturn, "do more with less" and quick ROI behavior become the norms. But wait, isn't that what open source and SaaS does? As budgets constrict, as headcounts lower - demands on IT will not decrease; they will almost certainly increase. Open source and Software as a Service will all bring IT staff - and end users - the abilities and cost savings they need and the innovation they want.

SaaS applications - especially those built from cost-effective open source - will continue to be a terrific way for businesses and individuals to get what they need in an extraordinarily cost-effective, simple way.

With regard to e-mail and collaboration, here is testimony to the movement toward SaaS and away from traditional on-premise. Hosted eMail accounts grew from 1 billion in 2006 to 1.6 billion in 2008 and will be at 2.2 billion in 2012, according to Radicati Group.

Microsoft has said it expects 50% of today's Exchange users to use an Exchange Service by 2012. And, IBM has announced recently that it will offer hosted Notes.

As we move forward, SaaS will give individuals and SMBs the same tools currently enjoyed by large businesses. For example, a SaaS messaging and collaboration offering like 1&1 MailXchange costs between $24 and $60 per user annually, including mobility support. Consider that $1,250 is the total yearly cost of an Exchange account.

In a 10-, 20-, or 50- person company, SaaS and open source software can save between 80% and 99% of the current cost. Not only can small companies benefit from moving to SaaS, also very large corporations are now looking at making some radical decisions.