Bill McDermott, SAP’s president and CEO of global field operations, spoke with InformationWeek earlier this month and covered some finer points about SaaS.  Two points in particular that caught my interest: many companies will be disillusioned by SaaS once they realize it’s more expensive and complex than they anticipated, and that SaaS won’t work for companies as a core platform.

On the first point about SaaS disillusionment: it is pretty clear that there’s a lot of hype and excitement about around SaaS right now, but that’s pretty normal.  SOA and BPM went through the same hype curves, and SOA in particular is currently at the tail end of what I would describe as a prolonged trough of disillusionment.  BPM, on the other hand, is finally mature enough to be providing companies with business value.

It’s certainly probable that some companies may get in over their heads and invest too quickly in SaaS without proper planning, but that can really happen with any kind of software initiative.  Just think about all the disaster stories you’ve probably heard about CRM or ERP deployments gone awry and how costly it ended up being.  But that doesn’t mean that all types of SaaS solutions and targets are going to end up being big disappointments.  As I wrote earlier, some target for SaaS conversion are inherently easier than others.  And smaller companies who are looking for new investments in CRM, ERP or other business productivity tools might find value right away in solutions like Salesforce.com, Zoho, SugarCRM or products from 37signals.

On the second point about SaaS being a platform: I think this is true for companies that still think of their business applications needing to be built all on a single platform.  The problem, as I’ve discussed earlier, is that a single platform almost always ends up creating a big data silo, where it’s easy to move data around on the platform but hard to write connectors to other applications.  Companies that have started to invest in SOA are probably less concerned about having a single platform – they may already be realizing the benefits of having loosely coupled systems that can interoperate regardless of the underlying development platform.

SaaS providers should certainly learn from what’s been through the hype curve before to try to prevent SaaS products from hitting an extended trough of disillusionment.  As I mentioned before, in part this can be done with data portability, but I think this also can come quite effectively by providing customers with tools to prove ROI.   For example, SaaS providers offering dashboard-like ROI calculators that can show a customer their SaaS usage.  SaaS providers could even potentially show aggregate data other companies of similar size and industry, that could give them an idea of how efficiently they are operating – akin to comparing site metrics in analytics tools like Google Analytics.

It’s true that some business software just won’t prove to be a viable SaaS offering at all, and some customers won’t be able to adopt it because of their business restrictions, but there are already SaaS success stories for both customers and vendors today, and there are likely to be many more in the future.

Filed under: Cloud Computing, Enterprise Web, SaaS | Comments Off

Missing no opportunity to take a swipe at the competition, Oracle’s Senior VP of CRM On Demand Anthony Lye talked about Salesforce.com’s recent 40 minute service outage with InformationWeek’s Mary Hayes Weier.

In an interview with Weier, Lye discussed Oracle’s approach to CRM On Demand as opposed to Salesforce.com.  In particular, Lye brought up CRM On Demand’s “Pod” structure, wherein customers can either be in a single-tenant or multi-tenant datacenter.  Some customers get their own dedicated “pods”, while others share theirs with customers that share similar qualities (for example, all want maintenance to run on a particular day).

Lye positions this design as a competitive advantage over Salesforce.com, but to me this actually seems a like an extra cost for Oracle without much benefit to customers.  No single pod can be perfect and completely invulnerable to outages, and if I’m a customer of Oracle’s CRM SaaS, and my competitor is too, I’d be happy if both me and my competition was without CRM for a period of time, and not take a chance that my pod may be down while the competition’s is up and running.

In terms of the extra cost to Oracle, running multiple “pods”, all with potentially different releases of the CRM software, and different usage levels makes it difficult to manage the data center.  It seems like a lot of extra management cost.  If that management cost is passed on to the customer, it’s probably going to make them turn to a competitor who is running their datacenter more efficiently.  If Oracle eats the cost, they’re shaving off profit from a business which is already has notoriously slim profit margins.

Weier goes on to write:

But my sense is Oracle is going to be looking at any way it can to weaken Salesforce.com’s position of strength in the CRM SaaS market. SaaS may not be a highly profitable business model for software companies, but Ellison & team clearly want a piece of it

I believe this is absolutely true, and is what I wrote about earlier regarding Larry Ellison’s recent comments on cloud computing.  SaaS is just in its infancy.  As SaaS matures, customers and enterprise software companies will reap significant rewards.  Ellison appears to be readying Oracle to claim Salesforce.com as its prize in case their own CRM On Demand business fails to gain traction.

Filed under: Cloud Computing, Enterprise Web, SaaS | 1 Comment »

There was plenty of coverage of Palm unveiling the Pre today at CES 2009 in Las Vegas.  It certainly helped their stock — Palm’s stock price rose over 34% on the release of the Pre, closing at $4.45 today.

Looking at the phone, it’s easy to see why people like what they see:

• Large, vivid multi-touch touchscreen
• Email, web, contacts, etc.
• Slide-out keyboard
• Built-in WiFi
• Wireless charger (called a Touchstone)
• Integration of 3rd party apps (through a store maintained by Palm)

It’s too early to tell if this will be the ticket to Palm’s future, and keep them from hitting the technology dustbin, but the phone does look nice.  Only after the phone hits the market — sometime after the first half of 2009 — will consumers have a chance to shell out over $200 for the Palm Pre and decide if it’s a winner over the iPhone, BlackBerry Storm… Oh, and the HTC G1 Android-powered phone, too.

Additional coverage of the Palm Pre:

• Hands on video with the Pre [ArsTechnica]
• Hands on photos of the Pre [TechCrunch]
• Photos of the Pre at CES [CNET News]

Filed under: Hardware, Mobile Web | Comments Off

Salesforce.com experienced an unusually long outage on Tuesday, which had the site down for most customers for about 40 minutes.

One of the really great things about Salesforce.com is their service status page, that outlines whether the service is up and available, down for planned maintenance, or experiencing performance issues.  This is the type of public status page that ever SaaS provider should have in some form or another.

The service status page paints the picture of the outage on Tuesday:

According to the outage status, the error was caused by a critical network component memory failure, which did not gracefully fail over to a secondary system:

A core network device failed due to memory allocation errors. The failure caused it to stop passing data but did not properly trigger a graceful fail over to the redundant system as the memory allocation errors were present on the failover system as well. This resulted in a full service failure for all instances. Salesforce.com had to initiate manual recovery steps to bring the service back up.

This type of service outage is rare for Salesforce.com, but even the best built IT systems can have their bad days.

Filed under: Enterprise Web, SaaS | Comments Off

I guess I’m a little slow today – well, I’m a little slow every day. Almost immediately after I posted the news about Sony’s new Internet-ready televisions, I caught this press release from Vizio:

VIZIO, America’s TV and Consumer Electronics Company, announced today the unveiling of its "Connected HDTV" Platform, which enhances the HDTV viewing experience by bringing personalized entertainment, information and social networking content into the viewer’s living room. With unprecedented choice and control of web-based and local content from a wide range of popular content providers and services, including on-demand movies and music, news, weather, sports, gaming and social networking services, this platform will be integrated as a key feature into VIZIO televisions shipping to retailers nationwide this Fall 2009 in time for the busy holiday season.

So I guess even if my next television is a Vizio (which I have been very happy with for the last two years), I’ll still get all the same benefits of having Internet connectivity.  It’s good to see all of the major television manufacturers moving towards the same trend.  Is it just a matter of time, though, before we see things like a television with a built in gaming platform as well?

One thing that’s not clear from all the press releases is the details around what browser (if any) will be built into the televisions, and how well they’ll support RIA (rich Internet applications).  I’m sure details will be forthcoming for developers, though.

Filed under: Consumer Web, Entertainment, Hardware | 1 Comment »

Earlier this week I had posted about LG offering Netflix streaming in its new HDTVs and other signs that the Internet is gradually becoming the future of television.  Sony, unsurprisingly, won’t be outdone by LG.  They’re also offering new Internet capable Bravia HDTVs, unveiled at CES 2009 in Las Vegas today.

According to the official press release:

Sony’s new XBR9 and Z-series models feature an Ethernet connection, allowing the sets to directly access Sony BRAVIA Internet Video content using an existing broadband connection. The service offers one of the largest selections of free and premium movies, TV shows, sports, music and more from an array of partners like Amazon Video on Demand, YouTube(R), Yahoo!(R), Slacker, and others.

If Sony’s TVs weren’t so expensive, this might be interesting for me.  I’m going to stick with my “low end” Vizio LCD TV for now.  It may not have any direct connections to the Internet, but the picture quality is good, and I can always surf the web with my Nintendo Wii or watch streaming Netflix movies with my Xbox 360.  But it’s good to see that manufacturers are starting to build these kinds of capabilities directly into newer TVs.  Something for me to look forward to in maybe 4-5 years, I suppose.

Filed under: Consumer Web, Entertainment, Hardware | Comments Off

As was expected by most, Microsoft announced the availability of the public beta of Windows 7 at CES 2009 in Las Vegas today.  If you’re a TechNet, TechBeta or MSDN customer, you can download the Windows 7 beta today.  The rest of us can get our copy of the Windows 7 beta for free starting January 9th.

According to the official Microsoft press release:

With Windows 7, Microsoft paid special attention to performance, reliability, security, compatibility and battery life. The company is on track to deliver a great experience that will allow customers to spend more time doing the things they want to do, without the operating system getting in the way.

Hmm.  Special attention to compatibility, eh?  Does that mean Windows 7 will support older hardware and software better than Windows Vista?  And what’s that point about “without the operating system getting in the way” – that sounds an awful lot like those annoying User Access Control messages that people complained about with Vista.

In any case, it sounds like Microsoft is on target to release Windows 7 in the middle of next year, which may mean as I had written earlier that some business customers may never upgrade to Windows Vista at all, and instead go directly from Windows XP to Windows 7.

More details about Windows 7 are at Microsoft’s site: http://www.microsoft.com/windows/windows-7/default.aspx

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