THINK IT Services

Oracle took advantage of IBM’s failed efforts to acquire Sun Microsystems and swooped in with a more lucrative bid today which could reap greater rewards for the company’s rapidly expanding cloud computing strategy.

Oracle’s acquisition of Sun could recast the entire computer industry by giving Oracle control of Sun’s Java software and access to its vast developer community, plus Sun’s Solaris-based server technology. These elements could bolster Oracle’s database systems and serve as a powerful web delivery engine for the company’s widening array of business applications and third-party developers.

Oracle had to be sweating bullets during the IBM/Sun negotiations because, “The Sun Solaris operating system is the leading platform for the Oracle database, Oracle’s largest business…”, according to Oracle’s press release today.

Don’t let Larry Ellison’s past pronouncements that the Software-as-a-Service (SaaS) and cloud computing trends are just over-hyped ideas. Folks within Oracle have been working hard to make sure that the company can benefit from the rapid evolution of the on-demand movement. Now, they have the ability to not only expand their software development arsenal, but add to their computing platform as well.

These assets will not only come in handy for third-party developers and enterprise users who want to acquire them, they will also fortify Oracle’s hosting business and help Oracle quickly convert its hosting capabilities into a true cloud computing environment.

According to Oracle’s President Charles Phillips, “Our largest customers have been asking us to step up to a broader role to reduce complexity, risk and cost by delivering a highly optimized stack based on standards.”

I may be looking at the world through cloud-colored glasses, but this sounds like the preview of a new round of cloud computing initiatives to me.

THINKstrategies announced today that Service-now.com has been named the latest winner of the Best of SaaS Showplace (BoSS) Awards program, which is aimed at promoting the measurable business benefits being delivered by today’s Software-as-a-Service (SaaS) solutions. 

The BoSS Awards program was announced in January 2009 as the latest initiative by THINKstrategies to bring attention to SaaS and cloud computing companies which are producing tangible business benefits for specific user organizations. These benefits include increased sales, lower costs, higher customer satisfaction, faster operations, and greater profitability.

Service-now.com is a leading provider of leading provider of SaaS for IT service automation. Service-now.com integrates Information Technology Infrastructure Library ITIL v3 process support, modern software-as-a-service (SaaS) delivery, and Web 2.0 functionality to provide a flexible, intuitive and self-managing application.

An example of Service-now.com’s business benefits is Unitus Community Credit Union which expects to reduce its annual total cost of ownership (TCO) $40,000 by cutting the costs for hardware refresh, storage, heating and cooling, additional application licenses, and general application support. Unitus Community Credit Union also calculated a return on investment (ROI) of 110% after year one and 170% in years two through five.
 
A full description of the company’s winning BoSS Award submission can be found at http://www.saas-showplace.com/awardSummary.php?key=352.

Click here to read today’s announcement.

Click here to learn more about the BoSS Awards program or to submit a nomination for an Award.

QuickArrow has been named the latest winner of the Best of SaaS Showplace (BoSS) Awards program, which is aimed at promoting the measurable business benefits being delivered by today’s Software-as-a-Service (SaaS) solutions.

The BoSS Awards program was announced in January 2009 as the latest initiative by THINKstrategies to bring attention to SaaS and cloud computing companies which are producing tangible business benefits for specific user organizations. These benefits include increased sales, lower costs, higher customer satisfaction, faster operations, and greater profitability.

QuickArrow’s professional services automation (PSA) solution helps service organizations manage their people and projects, by providing a comprehensive solution that includes time, expense, and billing management, project management, resource management, and advanced real-time reporting capabilities. By replacing homegrown solutions and labor-intensive spreadsheets to automate workflows, QuickArrow provides businesses the ability to streamline operations and achieve better visibility to optimize their services delivery.

QuickArrow’s solution helped KnowledgeCentrix generate a 20% increase in project profitability. It enabled Spanlink to reduce the end-of-month revenue recognition process from 2 weeks to 2 days, and permits Troux Technologies to shrink its end of quarter invoicing process from 2 weeks to 3 days. QuickArrow’s solution also helped Genesys achieve 25-30% improvement in capturing time and expense (T&E) information worldwide, reducing remote data entry in some instances from several hours to a few minutes.

A full description of the company’s winning BoSS Award submission can be found at http://www.saas-showplace.com/awardSummary.php?key=319. 

Click here to learn more about the Boss Awards and previous winners.

A friend at AT&T, Joe Weinman, continues to pump out thoughtful blog posts regarding the rapid evolution of the cloud computing industry. His latest post on GigaOm entitled, “6 Half-Truths About the Cloud”, includes a link to a previous post which offers “10 Reasons Why Telcos Will Dominate Enterprise Cloud Computing “.

I was drawn to his previous post because Joe added a link in today’s post for his definition of “CLOUD” – Common, Location-independent, Online Utility provisioned on-Demand.

But, I was also compelled to respond to Joe’s suggestion that the telcos are in the best position to capitalize on the growing demand among enterprises for cloud computing services.

I was originally attracted to the technology industry in 1982 not because I was a geeky engineer but because I was a MBA student looking for a hot new market opportunity and saw the impending divestiture of AT&T as my opportunity.  I joined IDC in 1983 to help launch its communications research program to track the transformation the telecommunications industry in particular, and the technology industry as a whole.

The AT&T divestiture produced a new generation of Regional Bell Operating Companies (RBOCs) promising a new era of competition and innovation. Over the subsequent years, they made numerous efforts to expand beyond communications into the data center with a variety of computer hardware sales and systems integration services initiatives with limited success.

Twenty years of infighting led to a new round of consolidation which has left only two major U.S. telecom giants still standing–AT&T and Verizon–along with Qwest and a wide array of seconday players. AT&T, Verizon and Qwest have succeeded in becoming important hosting companies, but they are by no means leading the market from a thought-leadership or innovation standpoint. Instead, they are delivering dependable ‘dialtone’ for companies seeking simple, straightforward hosting services.

While there is nothing wrong with delivering reliable services, in today’s rapidly evolving cloud computing environment reliability is quickly becoming table-stakes as businesses of all sizes seek cloud computing services which can give them greater agility, better economies and added functionality to reduce their operating costs and strengthen their competitive positions. These are not attributes which people associate with telcos.

In the past, we could attribute the failure of telcos to penetrate the data center as an outgrowth of the internal feuds between voice and data communications engineers within most mid- and large-scale organizations. Those internal battles have subsided as many organizations consolidated their inhouse staffs. But, the telcos continue to sell ‘dialtone’ and have been unable to demonstrate any real value-add in the data center.

In fact, even responding to new ideas and business models in their core communications business continues to be a struggle for the telcos. They watched landline revenues dry up as wireless services exploded. They watched traditional transport services give way to Internet services. Now, Skype is the largest international long-distance carrier.

Telcos are still struggling to figure out managed services, which have been around for over a decade, as a new wave of Software-as-a-Service (SaaS) and cloud computing services become mainstream.

I contributed a series of commentaries to the Web Hosting Industry Review (WHIR) from 2004-2007 that discussed the tremendous potential of the telcos in the hosting, SaaS and utility (now, ‘cloud’) computing arena which have yet to be fully realized.

Of course, telcos are not alone in their struggles with today’s disruptive technologies and rapidly changing customer preferences. Today’s issue of the Boston Globe includes a fascinating story about its own myopia which led to it missing a perfect opportunity over a decade ago to acquire a major share of Monster.com, which eventually became one of the major catalysts of the current decline of the newspaper industry.

As my friend Joe Weinman correctly states, the telcos are in a perfect position to dominate the enterprise cloud computing market. They have the technical resources, channels to market and brand equity. But, can they overcome their history, culture and other internal barriers to success?

Phil Wainwright has posted a terrific blog entry regarding the ‘green crystals’ that power Salesforce.com’s multi-tenant platform.

The concept of multi-tenancy has been a cornerstone of the Software-as-a-Service (SaaS) movement and a key element of the rapidly evolving cloud computing environment as well.

For anyone who is unfamiliar with the term ‘multi-tenancy’, it is borrowed from the housing market and aims to compare today’s leading SaaS/cloud computing vendors to condominium owners who can obtain more luxurious living quarters without the hassles of owning a single-family home by sharing a common infrastructure and operational services.

While this arrangement offers plenty of conveniences, it also requires some sacrifices when it comes to how far you can customize your particular unit, or version of software in the case of SaaS.

While the value proposition of multi-tenancy is easy to understand, it is hard to get a lot of details about how leading SaaS and cloud computing vendors are actually architecting their multi-tenant platforms to develop and deliver their solutions.

Phil’s blog provides valuable insight into Salesforce.com’s approach. But, what he doesn’t fully answer is the question why Salesforce.com is placing greater emphasis on its approach to multi-tenancy today.

I started to notice Marc Benioff and other company officials promoting their multi-tenant architecture prior to the launch of its Force.com Platform-as-a-Service (PaaS), and have watched this aspect of their well-choreographed marketing efforts become more prominent over the past year.

I think there are two primary reasons for Salesforce.com’s growing focus on the multi-tenant topic:

1. The growing popularity of SaaS has attracted a proliferation of players, including legacy independent software vendors (LISVs) who are trying to enter the market with hosted versions of their single tenant applications. Salesforce.com is trying to fend off these late entrants by educating IT/business decision-makers about the benefits of multi-tenancy.
2. Salesforce.com is also trying to convince various software vendors, start-ups as well as LISVs, that its Force.com PaaS capabilities are superior to the plethora of competing platforms in the market by revealing more about its ‘green crystals’. This is especially timely because Salesforce.com is accused by many of having a proprietary platform, rather than an open architecture like others.

Phil correctly suggests that it is essential for Salesforce.com to convince enterprise decision-makers of the unique qualities of its multi-tenant architecture. It is also imperative that Salesforce.com do the same for ISVs as it faces growing competition from PaaS offerings from Amazon, Google, IBM, Microsoft and others.

Ever since my early days as an industry analyst at IDC in the 1980s, I’ve been convinced that one of the most potent, yet under-utilized resources in the IT market are the major trade associations.

When I first looked at these associations, I thought of them as targets for research purposes. Now, I view them as a terrific channel to market.

Intacct is putting my ideas to the test by entering into a new alliance with the American Institute of Certified Public Accountants (AICPA) and its CPA2Biz subsidiary to encourage the association’s 45,000 member CPA firms and their 350,000 small and mid-sized businesses (SMBs) to adopt Software-as-a-Service (SaaS) and “cloud computing” alternatives to traditional financial applications.

Under this agreement, Intacct and CPA2Biz will co-develop a new version of Intacct’s on-demand financial management and accounting applications to specifically address the needs of CPA firms and their clients. Intacct will also work with the AICPA to develop education programs and promote indutry best practices based on data accumulated from the Intacct services.

According to the company and association officials who briefed me about this announcement a week ago, the agreement was a year in the making.

Intacct has been working with a variety of accounting firms on a one-on-one basis for a number of years, convinced that they could be good referral agents for its SaaS solutions. However, it became clear to Intacct that building these relationships on a one-by-one basis was not cost-effective or scalable.

Meanwhile, the ACPA recognized that its members were feeling increasing competitive pressures from a widening array of web-based, economical accounting packages which undercut the value of its members’ traditional professional services.

This alliance is not only a straightforward attempt to respond to these member concerns. It is alao a bold statement by the association endorsing the value of SaaS solutions and viability of cloud computing services.

This is a watershed event because it shows how fast SaaS and cloud computing are becoming mainstream. There are few segments of the market that are more conservative than the accounting profession. The ACPA/CPA2Biz/Intacct alliance will not only help to educate CPA firms and their SMB customers about the viability and value of SaaS and cloud computing, it also promises to create new SaaS and cloud computing solutions to meet their specific needs.

I’ve been saying for months that 2009 would be the year of the channel for the SaaS industry and that a variety of new channel players would emerge to fill the void that traditional VARs and integrators won’t be able to address. This alliance will be an important test of the new kinds of channel strategies and relationships the SaaS/cloud computing marketplace needs.

Clarizen has been named the latest winner of the Best of SaaS Showplace (BoSS) Awards program, which is aimed at promoting the measurable business benefits being delivered by today’s Software-as-a-Service (SaaS) solutions.

The BoSS Awards program was announced in January 2009 as the latest initiative by THINKstrategies to bring attention to SaaS and cloud computing companies which are producing tangible business benefits for specific user organizations. These benefits include increased sales, lower costs, higher customer satisfaction, faster operations, and greater profitability.

Clarizen is a leading provider of collaborative online project management software that allows businesses to easily manage all of their projects and resources in a single environment.

Click here to read more about Clarizen’s award-winning SaaS solution.

Click here to learn more about the BoSS Awards.

The proliferation of Software-as-a-Service (SaaS) and cloud computing platform players continues to accelerate despite the failure of some early entrants and likelihood of more Platform-as-a-Service (PaaS) casualties to come.

This past week, three more companies announced new platform strategies and solutions — Jaspersoft, ExpenseWatch.com, LongJump.

Open-source business intelligence (BI) vendor Jaspersoft unveiled its v3.5 integrated analysis capabilities as part of what it calls the industry’s first SaaS-enabled BI platform. The new platform promises easy-to-use integrated analysis that doesn’t require a data warehouse or OLAP server. It also includes new in-memory analysis capabilities that enables the delivery of customizable SaaS and Cloud-based BI applications which can be integrated into reports and dashboards.

ExpenseWatch.com announced an open expense control platform which will permit small and midsized businesses (SMBs) to integrate their expense management data with a variety of business application. The new “non-proprietary approach” promises to allow SMBs to create more streamlined processes to manage their expenses.

LongJump announced that its previously available LongJump Business Applications Platform can now be licensed for use within an enterprise’s data center or licensed by independent software vendors (ISVs) who want to build and host their own SaaS applications. This new ‘portability’ is in response to the growing demands among enterprises to house their SaaS apps behind the firewall. It is also another example of the rapid technological advancements in the SaaS/cloud computing industry which increasingly permits this new form of ‘hybrid’ solution to occur.

While LongJump asserted itself as a PaaS vendor a while ago and its solution truly permits enterprise users and ISVs to build new SaaS apps via its development environment, ExpenseWatch.com and JasperSoft appear to be stretching the meaning of the PaaS idea to bring greater attention to their new integration capabilities.

Rather than being a toolkit upon which others can build SaaS apps, they are really offering easy-to-integrate functional capabilities which can be plugged into homegrown or third-party SaaS apps. This is still a valuable advancement of their previous capabilities, and represent the latest examples of the growing plug-and-play nature of the SaaS/cloud computing industry.

But given the proliferation of platform players and recent demise of Coghead, a pioneer in the PaaS market, I think SaaS/cloud computing companies would be better served by using different terminology to describe their integration capabilities.

Bastardizing the idea of platforms and PaaS will only clutter the marketplace and confuse potential customers. It will also increase the likelihood of an industry shakeout which will further discourage IT/business decision-makers from leveraging these ‘platform’ solutions.

HP unveiled a new Cloud Assure program this week, in conjunction with SaaScon, which responds to the growing concerns among enterprise decision-makers about the availability, security and performance of today’s rapidly evolving cloud computing services.

I think HP’s announcement is timely because enterprise IT/business decision-makers are interested in taking advantage of the burgeoning cloud computing opportunities, but apprehensive re: the reliability, accessibility and security (RAS) of these services. As a result, they’re looking for cloud computing services which give them a greater level of manageability, visibility and control.

HP is betting that it can capitalize on its the web monitoring services and skills it acquired in its Mercury Interactive deal, and its corporate brand equity as a network/system management (NSM) vendor to establish a strong position in the cloud computing management market.

HP’s biggest obstacle to success is that it isn’t considered a leading cloud computing vendor and doesn’t have a lot of obvious experience in this market. In fact, HP isn’t even seen as a player in the Software-as-a-Service (SaaS) and managed services markets which are often viewed as stepping stones to cloud computing.

Instead, HP is seen by many as a legacy software and services company who has made a big bet on the past ideas of traditional IT outsourcing with its acquisition of EDS rather than offering a comprehensive portfolio of services and solutions aimed at the new world of web-based services.

For instance, the Cloud Assure offering only utilizes the Mercury Interactive capabilities and doesn’t include its broader OpenView capabilities. Part of the problem is that HP is still trying to breakdown its internal silos to permit a more comprehensive set of solutions and services to emerge.

Until then, the company can be expected to announce a series of ‘point’ programs aimed at addressing various aspects of the cloud computing elephant.

The good news is that the growing involvement of established players, like HP, in the cloud computing market will give conservative enterprise decision-makers greater confidence that it is Ok to consider cloud computing alternatives.

The question is whether HP’s efforts to assert itself in the cloud computing management arena poses a threat to the rapid innovations which are being driven by others in the market, just like the potential threat posed by IBM’s Open Cloud standards initiative.

IBM’s attempt to initiate a set of standards for the burgeoning cloud computing services movement has been met with a mixed response that reflects the varying perspectives and suspicions which have historically plagued the IT industry.

IBM’s Open Cloud maneuver deserves some praise because it puts the resources of many of the IT industry’s top players behind an effort to bring order to the chaotic world of cloud computing.

But, IBM’s initiative is also an easy target for cynics who can question the motives of these vendors who appear to be just as interested in ‘co-opting’ the cloud movement to suit their proprietary purposes as seeking to establish useful rules-for-engagement that can truly safeguard users of cloud computing services.

The fact is that it is in the best long-term interests of cloud computing vendors and users alike to put standards in place which govern the fundamental architecture of these web-based services so that they can assure basic reliability, accessibility and security (RAS). The primary objectives should also include mechanisms which ease the path to portability of data from one cloud to another and interoperability between cloud-built applications.

But, there are two important caveats which vendors and users alike should know before they get too excited about IBM’s Open Cloud ideas.

First, today’s cloud computing innovators are already a step ahead of the legacy vendors who have rallied behind IBM’s Open Cloud proposal. They come from a new generation of web companies who recognized a long time ago that success on the Internet won’t come from the proprietary principles of the past, but by being as open as possible to encourage as many vendors and users to take advantage of their web-based resources. As a result, many of the Open Cloud ideas being promoted by IBM already exist via open APIs, web services and other web industry best practices which have made cloud computing attractive to many users in the first place.

Second, IT industry standard-setting initiatives historically have generally fallen short of their ideals. I first became aware of the fundamental weakness of industry standards when I was an industry analyst in the 1980s focused on the telecom market and learned that every PBX vendor had succeeded in implementing proprietary interpretations of the RS-232 interconnection standard which prevented their PBX systems from interoperating with one another.

Today’s cloud computing world—ironically using a term originated from the networking and communications industry—runs the same risk of having a group of cloud vendors producing a set of industry ‘standards’ which leave too much room for individual interpretation and fail to achieve their original objectives.

So, why are IBM and its initial set of supporters advocating this type of standard-setting exercise if it is likely to produce the same outcome?

Because they are playing catch-up in the cloud computing market, and are threatened by the ‘game-changing’ nature of this new approach to IT.

Today’s cloud computing leaders—Amazon, Google, Salesforce.com, etc.—are winning business because they’ve given users a more flexible and cost-effective alternative to traditional computing that is satisfying customers’ rapidly changing corporate requirements.

The cloud computing leaders are concerned that IBM’s proposed standard-setting effort could slow the hyper-speed evolution of this market and give the established players time to figure out how to reconfigure their technologies and business models to respond to the cloud computing threat. It could also slowdown the market leaders and innovators with a set of duplicative and/or hollow rules that complicate cloud services rather than streamlining the interoperability of the various offerings and deployments.

In all these ways, the Open Cloud effort is a classic Machiavellian maneuver by a threatened set of industry titans watching their fiefdoms fall under attack by a new coalition of revolutionary forces.

Nonetheless, I think industry efforts to put practical standards in place should continue to be pursued. However, these should be driven by users of cloud computing services, not vendors.