Comments on: SAP Snaps Up Coghead http://www.thinkstrategies.com/blog/2009/02/sap-snaps-up-coghead.html This blog examines the business implications of IT service trends ranging from software-as-a-service (SaaS) and cloud computing to managed services and other on-demand services. Wed, 03 Nov 2010 22:38:58 -0400 hourly 1 By: EDunigan http://www.thinkstrategies.com/blog/2009/02/sap-snaps-up-coghead.html/comment-page-1#comment-353 EDunigan Mon, 02 Mar 2009 17:11:06 +0000 http://www.thinkstrategies.com/blog/?p=372#comment-353 Jeff - As an employee of an online database company, I agree that it does take solid technologies and attractive channels to survive the current economic shakeout. I also feel that companies evaluating SaaS offerings should do their diligence when evaluating SaaS providers. Jim above makes a great comment on pricing and this is one of the considerations our CTO and CEO recently mentioned as one of the critical tips to consider when evaluating SaaS offerings. Take a look at our recent blog posting and podcast highlighting other tips companies should consider when evaluating SaaS offerings: http://www.trackvia.com/blog/2009/03/02/saas-tips/ Ed TrackVia Jeff -
As an employee of an online database company, I agree that it does take solid technologies and attractive channels to survive the current economic shakeout.

I also feel that companies evaluating SaaS offerings should do their diligence when evaluating SaaS providers. Jim above makes a great comment on pricing and this is one of the considerations our CTO and CEO recently mentioned as one of the critical tips to consider when evaluating SaaS offerings. Take a look at our recent blog posting and podcast highlighting other tips companies should consider when evaluating SaaS offerings:

http://www.trackvia.com/blog/2009/03/02/saas-tips/

Ed
TrackVia

]]> By: Jim Geisman http://www.thinkstrategies.com/blog/2009/02/sap-snaps-up-coghead.html/comment-page-1#comment-338 Jim Geisman Sat, 28 Feb 2009 18:32:53 +0000 http://www.thinkstrategies.com/blog/?p=372#comment-338 Whatever value proposition Coghead offered was sufficient to attract some customers. I'd bet the customer volume wasn't all that high despite the product's attractiveness. In early 2008 I was looking for examples of SaaS services pricing for a presentation at SaaS University and came across Coghead's pricing. It was clear to me based on our experience in software and SaaS pricing, that their pricing "architecture" was unlikely to sustain the company. It takes a lot of deals to generate meaningful revenue at the original price of $50/month for 5 developers and unlimited apps. The price looked just too low. The license metric of developers makes sense but maybe not as much as per app. Further there were other elements of their pricing that were obscure or hard to estimate (or both.) While product is important, company success requires a pricing architecture that will support the company business model and ability to raise capital. Jim Geisman Software Pricing Partners, Inc. Whatever value proposition Coghead offered was sufficient to attract some customers. I’d bet the customer volume wasn’t all that high despite the product’s attractiveness.

In early 2008 I was looking for examples of SaaS services pricing for a presentation at SaaS University and came across Coghead’s pricing. It was clear to me based on our experience in software and SaaS pricing, that their pricing “architecture” was unlikely to sustain the company.

It takes a lot of deals to generate meaningful revenue at the original price of $50/month for 5 developers and unlimited apps. The price looked just too low. The license metric of developers makes sense but maybe not as much as per app. Further there were other elements of their pricing that were obscure or hard to estimate (or both.)

While product is important, company success requires a pricing architecture that will support the company business model and ability to raise capital.

Jim Geisman
Software Pricing Partners, Inc.

]]> By: Alain Yap http://www.thinkstrategies.com/blog/2009/02/sap-snaps-up-coghead.html/comment-page-1#comment-307 Alain Yap Mon, 23 Feb 2009 08:30:40 +0000 http://www.thinkstrategies.com/blog/?p=372#comment-307 Hi, Jeff! It is unfortunate but not surprising that business revenue models for SaaS and PaaS continue to take beatings and would stay so unless enterprise adoption- not isvs and medium- sized orgs, really becomes widespread. Can't really fault Coghead for this and I'm sure their subscribers really believed in their product but revenues, esp if something priced really affordable (err cheap) may be akin to a slow death. Somewhere, I see the 'big' boys grinning.... Best. Alain Yap Morph Labs Hi, Jeff!

It is unfortunate but not surprising that business revenue models for SaaS and PaaS continue to take beatings and would stay so unless enterprise adoption- not isvs and medium- sized orgs, really becomes widespread.

Can’t really fault Coghead for this and I’m sure their subscribers really believed in their product but revenues, esp if something priced really affordable (err cheap) may be akin to a slow death.

Somewhere, I see the ‘big’ boys grinning….

Best.
Alain Yap
Morph Labs

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