Virtualization news for the channel community and you !

(reflection on an article by Mary Hayes Weier – Informationweek)

First of all we talk about Software-as-a-service in this “reflectiondoc” and not about “Storage-as-a-Service”. Over the past 5 years SaaS has grown in marketshare, yet it has not yet gained general acceptance in the enterprise market.

The first thing that should happen is general acceptance by MS, Oracle and SAP according to Mary Hayes Weier pure by the fact that enterprise won’t walk away from their heavy investements and developments in ERP systems like Oracle and SAP. Out of the mentioned 3 only Oracle has a SaaS solution for its Siebel CRM, the other two have a SaaS concept in which the SaaS-end connects with the on-premise installation. So it is not only the companies that might not immediately move to SaaS it is also the vendor that has currently more advantages, when selling ordinary licenses. This brings us to the point in which that licensing-systems need to be ‘rethinked’. This rethinking might take ages but other companies that have jumped on the SaaS-wagon are not exactly waiting on the side of the road till the big ones have made up their mind. One thing is for sure, when a large vendor sees the money in a certain technology, the licensing will be adopted accordingly without damaging the normal revenue-streams for ordinary license (for example: changes in CAL licensing for W2Kx Virtual Machines). Futhermore this adoption will generate an avalange to the other vendors that will promptly follow the move.

Another aspect is uptime, reaching a 100% uptime would be nice, but is it feasible? What happens when there is downtime, a SaaS customer can not go to the data center to fix the problem he will have to rely on the expertise of the SaaS provider. What does that mean when implementing specific built applications in a SaaS environment? As Mary states in her article, there is no possibility that the customer can send his own crew to the data center to fix the problem. This brings us once again to an earlier post about possible cloud providers, it is clear that VARs and Integrators are one step ahead as they have the background on the customer and even often have developed the software. Another issue that comes to mind is the number of different SaaS-providers that have been specializing in a niche segment: Intacct (ERP), Authoria (HR), Startup Workday (ERP), Take Workday, Concur (Employee Expense Management), how would you use an ERP SaaS-provider and link it to the HR SaaS-provider? This brings us to the next focal point: Integration

As customer will not throw out their expensive investements in onsite licenses and require flexibility with SaaS-enabled applications, the only way to go is to offer the capacity to integration newly rolled-out SaaS-applications with onsite applications. This integration consists out of two players: the SaaS-provider and those vendors that have written the onsite software and the SaaS applications. Three parties to setup one line between two applications, three weak links? There is a clear need for some standardization. Furthermore integration means development, which means additional cost. In order to be convincing there need to be a clear TCO model, which is currently not yet fully available although some SaaS-providers have TCO calculations. These TCO calculations do not incorporate the additional development cost if needed. The development and integration has shown to be the expensive factor in the calculation, to eliminate this calculations customers must be convinced that they can do without customization and that might be a very hard part to do.