Squarespace as a Situational App programming model

The situational application community is not really on the radar of most CIOs with whom I am acquainted, which is a bit like saying that in 2000, the agile development community was not on their radar; it didn't really need to be. Nonetheless, it's an important trend and it may be, as the component of the SaaS market that it is, a technology which comes to dominate the CIO's interaction with business staff in the future.
Situational applications are still finding their way in the marketplace, and a vast swath of products are being thrown in under that monicker (just as is happening under the broad umbrella "cloud computing"). The market will come to terms with the labels sooner or later but for now, when I talk about it, I'm talking about the software, and the scenario, described by Clay Shirky in his original "Situated Software" essay: situational software is software oriented to work for limited number of users in a specific scenario, without regard to scalability, extensibility, or "best practice" software design. Although Shirky doesn't go into great detail about how this is created, it's implied it will be built quickly, and not necessarily by professional programmers.
It is this last point where the industry seems to be hung up at the moment. Some of the most spirited discussions on the LinkedIn Situation Applications group revolve around the inadequacy of toolsets available to the end user to build these applications. Most CIOs have a backlog of development requests for situational applications; to the extent these must be serviced by professional development resources, they are bottlenecked and the ideas useless. A development platform accessibly to the end user could break this logjam; but as has historically been the case, platforms built by developers tend to lag in usability for mere mortals. Paradigms familiar to the builders are foreign and inaccessible to the intended users, and it's proven extremely difficult to bridge the gap.
I checked out SquareSpace for the first time last week, and I think I might have found the answer to some of those problems.
SquareSpace is a next generation web/blog host which has unprecedented web-based design capabilities oriented at the average user. Using templates and functionality modules created by professional designers as a launch pad, and making extensive use of AJAX drag and drop, the site allows web design neophytes to create functional, good-looking websites very rapidly. Security and commenting systems are built in. Anything complicated is probably already implemented; it's just a matter of finding the module and putting it where you want it.
This sort of front-end is exactly what is needed in the situational application market. It builds off of the sort of construction paradigm popularized by Yahoo Pipes but provides two key things that Pipes does not: straightforward, plain English templates, and real-time design feedback. You don't build your site, compile it, and go check it (the quintessential traditional development process); Squarespace modifies their CSS and site code on the fly and in real time, and as soon as you make a change you see the effect… even on the live site.
A situational application provider that could harness that easy drag and drop design and combine it with real-time feedback could break through the barrier. No cryptic error messages; the user can't be allowed to break the application, or if so it should degrade gracefully and clearly show the problem in the results.
If I were a PaaS or other sort of vendor aiming at the business end-user, I'd be hunting down the folks behind Squarespace and throwing money at them to provide some UI and design magic to make my platform as dead simple to explore and use.
EDIT: As is often the case, I appear to be going down a path already well-explored by Jonathan Sapir, who wrote on this same topic (with a more informed perspective) back in February.
Scott, excellent observations. I am also a great fan of Squarespace and have been using them a long time.
Also, I think their approach to templates (in the form of things like widgets) fits extremely well with the concept of Goal Driven Development.
See here http://www.powerinthecloud.com/blog/2009/2/13/squarespace-superb-web-site-creation-platform.html
and here
http://www.powerinthecloud.com/blog/2009/3/10/situational-applications-and-goal-directed-development-furth.html
Doh! That first post must have come up before I started following your blog… as ever, I appear to be plowing ground you have already tilled up. I’m glad to see someone in the industry has taken note of their service.