Thanks to SOA (Service Oriented Architecture), both Internal or External services has become less apparent, A Organization can now independently focus on their strengths rather to build one. Unlike older days where a Organization use to think to develop everything under their hoods, it has got a freedom to choose an external service as it is more economical and had a better user interface.
Assume we use a calendar service, In today’s world I need not stick to just one, If I am unhappy I can switch over to the other as almost all vendors provide similar standards/connections, so changing from one service to other is not that big anymore like a person today can switch over to multiple mobile service vendors as so called “mobile portability”
This will create rather has already created a dynamic environment where software vendors will compete using features or innovations that are independent of the connections. This could include user interfaces, software automations, rules engines, or user profiles that allow for highly customized interactions. These market forces will affect internal development as well. It will be difficult for an internal development group in an organizations to compete with a software vendor that can withold development costs by having many more customers than any internal development organization could imagine. The external vendor specialized in this domain and can achieve better product at a lower cost because of specialization. Internal development organizations will therefore shift to doing less development, rather focus only on their strengths, their core business values. The emphasis internally will shift to making all the connections work properly and integrating new services that might give an organization a competitive edge. Yes, an organization can/might also decide to provide a unique service that can be sold to other organizations.
Organizations will only buy vendor-provided products and services, why not? if the software is of sufficient quality. Sometimes the reason why an organization develops its own software is that it experiences poor quality in any vendor provided software. Vendors should be prepared to provide very superior quality software and a superior level of customer service.