2011 Predictions for Cloud, SaaS, Multi-Tenancy and More!

Jan 10, 2011 by Sinclair Schuller

OK, it’s already 2011 and I’m a bit late on providing some predictions for 2011 – but now is better than never! I sat down and thought about events in 2010 and whether those events have created a meaningful disruption with near term potential to affect 2011 outcomes, and this is what I came up with. Some of it is based on intuition, some on knowledge, and some experiences I’ve had at Apprenda in working with customers, prospects, and others in the industry. This is more of a mental exercise in subjective extrapolation rather than “prediction”, so don’t hold me to these;-)

1)Adoption of SaaS by ISVs will pick up more steam in 2011

a.Overall, an overwhelming majority of Independent Software Vendors (ISVs) deliver their software via the on-premises “packaged software” model. Consumption of software as a service (SaaS) offerings continues to grow at an amazing pace, but most of the demand has been satisfied by a couple of hundred companies that have surfaced in the past 10 years as wild success stories, such as Salesforce.com. As a result, I expect that on-premises player will continue to take notice and make the switch.

b.Competitive pressures within major verticals are becoming more and more real due to successful SaaS entrants, which will drive adoption of SaaS delivery as a market response. Existing software ISVs will start respond by moving part of their product lines to SaaS, or by choosing to offer down-market offerings as an initial experiment.

c.Counter to the perspective of many experts, packaged software ISVs will find strategies that work in their transition to SaaS. Transitional “poster-children” of each vertical will give confidence to other ISVs in the market that the transition can be made successfully.

d.Continued adoption of new technologies such as platform as a service (PaaS) and cloud application servers will bridge technical gaps that will ease the overall transition burden, fueling adoption of SaaS by more and more ISVs. I do not think SaaS is the nail in the coffin for existing ISVs, particularly with technologies like SaaSGrid in the mix which flatten the technical curve for both new application development as well as migrations.

e.Continued explosion of mobile usage creates further pressure (and significant opportunity) for companies to move to a SaaS delivery model. Most business applications that have a mobile angle typically need back-end systems to reconcile the data into primary applications, and SaaS is the only architecture that makes this feasible at scale across many customers.

2) The Upstack Scramble Intensifies

a.Big players continue to make big moves to seize the opportunity to control the new software battle ground in the cloud. Traditional platform vendors will realize that the application development and architecture tiers are huge opportunities, and that infrastructure virtualization and infrastructure tier technologies are not the competitive landscape of the future. Deals like the Heroku and Makara acquisitions make a lot of sense for players like Salesforce.com and Red Hat, respectively.

b.2011 and 2012 will be a make or break years for these big players, and the moves they make over the next 12 to 24 months will ultimately determine the next decade of control and leadership.

c.Commodity players, or players that have become commodity, seek to buy value up-stack through acquisitions.

3) Real Traction with Private Cloud/Internal Utility Computing and SaaS delivery

a.Mistakes and failures experienced in 2010 will be the lessons learned to drive the real solutions and seed private cloud and private PaaS adoption over the next 12 – 36 months.

b.Organizations want a unified and scalable platform for software delivery, and the vision of private cloud will begin to include technologies that sit above the virtual tier to give significant architecture and services value to internal development assets. A paradigm shift in how software developed internally for business units will kick off.

b. Enterprise projects will continue to explore leveraging Cloud architectures such as multi-tenancy for internal use. The cost savings and agility potential presents enormous savings profiles that push their way into enterprise development shops.

4) Cloud Washing Reaches Critical Mass and Collapses by EOY 2011

a.After attempting to cloud wash offerings, a number of small and mid-market ISVs will close shop due to competitive pressures and no real tactical response. This will help identify cloud washing as a poor strategy and that only real, measurable attempts to convert a SaaS model will lead to success.

b.Forces vendors to articulate how their strategies and solutions that is unique and truly “cloud.” Continued success of pure-cloud/SaaS plays will evidence that cloud washing adds no value.

5) Force.com Starts to Realize Momentum Potential

a.Force.com/Apex’s stuttered start begins to gain true rhythm now that Salesforce.com has diversified its cloud to be competitive outside of its proprietary track, particularly in Ruby and Java arenas due to Heroku and VMForce.

b.Force.com will continue to show strong among those extending Salesforce.com’s CRM functionality and potentially within the enterprise where it can be used to displace situational “spreadsheet” applications.

6) Cloud Middleware Provides Democratized Access to Complex Software Architectures

a.General development/programming skills declining, coupled with a continued increase in architecture complexity creates a gapping void that new middleware needs to fill

b.Just like the years when desktop OS’ spurred innovation by enabling companies to focus on their software and not the underlying complexities associated with its delivery – new solutions will fill the gap and catalyze a similar era of innovation once again.

c.Middleware solutions like SaaSGrid will drive multi-tenancy as a defacto standard since the primary concern of difficulty and cost to implement is trivialized.

7) QE[pick your number] won’t be a panacea for the economy – but SaaS and Cloud will help

a.Economic factors will continue to put pressure on operating budgets. Companies will be looking to do more with less; that is, they’ll want to boost efficiency while slashing budgets in order to survive in the modern economic climate. Due to size, IT budgets will be scrutinized and IT managers will be challenged to come up with solutions.

b.SaaS will be seen as a means of democratized access to solutions that drastically improve efficiencies while driving down the cost of IT. Infrastructure as a service will be leveraged to reduce the operating burden associated with in-house infrastructure.

c.Doing more with less, optimizing business performance – SaaS based B2B solutions will grow significantly in 2011 as a result.

I’d love to get everyone’s thoughts. Agree/disagree? Why? Did I miss something or does this seem to cover the right surface area?

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Salesforce.com’s Heroku Acquisition: A Clear Stake in the Ground

Dec 25, 2010 by Sinclair Schuller

Salesforce.com, over the past few years, has been reinventing itself as a platform company. IMHO, this is an extremely difficult thing to do for a company who’s cash flow is defined by the CRM market, an acronym that Salesforce.com adopted as a stock ticker. When Salesforce.com first announced Apex, it’s new fangled programming language and pseudo-stack, I took a highly critical stance because it was a clear attempt by a marketing and business team to tackle problems that only technologists can properly understand: building runtimes and frameworks that could provide a foundation for future software in the Cloud. My gripe was that Salesforce chose to create a new language that wasn’t rooted in a development paradigm shift where changes in a programmers ability to express solutions are the motivator, and instead decided to base the language development on seemingly more selfish interests and coupled the languages runtime to their operating and hosting environment. Essentially, they created vertically integrated lock-in, which is terrible for customers and the lack of purer motivations on the language development side produced a sub-par development stack best suited for small add ons.

Now we’re in 2010, and the story is starting to change, and seemingly for the better. At Dreamforce this year, Salesforce.com announced the acquisition of Heroku, the well known Ruby PaaS. Not too long ago, Salesforce.com and VMWare announced VMForce, bringing Java into the Salesforce.com cloud. Salesforce.com’s  evolution seems to be taking it down a path of stack agnosticism. This could be due to good strategic decisions making, or out of an attempt to correct a failed path with Force.com/Apex. Whatever the case maybe, its clear that Salesforce.com is embracing other stacks, and no longer focusing on creating a new $1 billion business by brute force.

It will be interesting to see where Salesforce.com goes with this. Will they make Java officially part of their Cloud by folding up a partnership with VMWare and instead make a Java Cloud their own competency? Might they go after Microsoft’s base by building or acquiring a value proposition that targets .NET developers and attempts to attract that group (who own 40% or so of the development market share) away from Azure? Who knows how far they’ll go, but one thing is clear: the Heroku acquisition clearly signaled that they want to do something different, and that something includes languages and runtime’s well outside of Apex. I really am glad that they’re adding true value and no longer beating the Force.com drum exclusively.

How do you feel about Salesforce.com’s Heroku acquisition? Any predictions on the success or failure?

If you’d like to mingle with others in the SaaS space, the SaaSBlogs group on LinkedIn now has 3600+ members and is growing every day; make sure you’ re not missing out and join today!

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Today’s PaaS Offerings: Pragmatic or Unrealistic?

Jul 12, 2010 by Sinclair Schuller

Although my focus in life right now is CEO of Apprenda, I come from a software development and architecture background (I needed to put my Math/Comp Sci. degree to good use at some point in my life). Anyone who has written software in any “old” (in this case, the double quotes are for sarcasm) platform technology like Java or .NET can assure you the writing software goes far beyond writing code and then running it. There are three major inflection points in the life of a piece of software:

1. The first time it is run
2. The first time it is tested under duress
3. Use in the real world

When people envision others writing code, they envision dozens of programmers writing text, deploying code, and using it. If it only were so simple. This make-believe scenario assumes that the only tool a developer uses is some sort of text editor/development environment. This is far from reality. Writing software typically requires the use of a number of advanced tools and techniques: debuggers (with the ability to work with real, running code), performance profiling tools, memory profiling tools, tuning tools for database queries, abilities to change the underlying runtime mechanics of your platform – you get the point. The reason for all of this is that code does not run as we expect it to, and this becomes painfully apparent at the three inflection points I described.

Interestingly, the general complexity of business software has been increasing. That is, business apps try to tackle more complex problems as each company tries to outdo their competitors by offering the market more value. This means that code also becomes more complex, tooling becomes more important, and visibility into an application becomes key.

Why then, did PaaS offerings (think Force.com style abstract PaaS offerings, particularly in the Apex only days) start off with such a “lowest common denominator” platform? Since business apps are becoming increasingly complex, and PaaS offerings presented a layer much less sophisticated than traditional platforms like .NET, how pragmatic are they for ISVs? As a tool for extending a CRM system, Force.com is clearly great stuff. It offers a simple way to provide new value to an existing system. But as a platform for serious ISVs who need to build complex offerings  - that’s a stretch. The complexity required of a serious development platform just isn’t there, and most software companies should recognize that. There are so many questions that are currently unanswered that make modern PaaS offerings unrealistic for many, many scenarios. Interestingly, these questions are unanswered for at least one (if not all) of the lifecycle inflection points I defined earlier:

1. How can I debug a live Force.com (as in real, “attach to the code and see what’s going on” debugging)?
2. My customers are complaining about speed, how can I performance profile and tune the application?
3. How can I optimize around certain types of resource consumption?
4. I can I use new architecture techniques if the PaaS is too limiting (think Apex before asynchronous calls – a concept that has existed in mature platforms for quite some time)
5. My application is not working as expected in production, and my developers need access to system specifics and the running code to assess what’s going on, how do I get to the live runtime?

I could go on for a long time.  Fundamentally, PaaS offerings seem far too trivial with VERY immature tooling. Yeah, yeah – you’ll here the “In PaaS X, you’ll never have to worry about Y.” The fact of the matter is, code rarely meets expectation at those inflection points, and developers need to dig deep to make magic happen. PaaS offerings really trivialize this. It reminds me of the days when WYSIWYG editors were going to “revolutionize” how websites were made (think Frontpage, Homesite, etc.) and that web design would be democratized, and no one would have to touch HTML, JavaScript etc. We all know how that turned out. The concept of “everything can be written for you, no need to “hand tweak” has never worked at scale, and typically has failed miserably. The best web properties are still written “low level” (relative to web technologies), and complex tools and libraries for JavaScript, Flash, and Silverlight are flourishing.

“Old” runtimes can do a far better job than PaaS when coupled with purpose-built middleware for SaaS and cloud infrastructure like EC2. Developers can capture complex requirements and systems with the right languages and have all the real world tools needed to properly build, test, and evolve software.

Do you feel that PaaS offerings nailed it, or do you agree that they missed the mark and currently cannot support high levels of complexity and real software development life cycles? Is PaaS currently a reflection of WYSIWYG web editors and we’ll instead see a cloud stack evolve that doesn’t try to “solve everything” in one silo?

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According to ISVs, Salesforce’s Force.com is Not the Platform for SaaS

Mar 3, 2008 by Sinclair Schuller

I bumped into a brief but impactful article by Renee Boucher Ferguson titled “ISVs Snub Salesforce’s Force.com Platform“. The post basically summarized a situation that occurred after OpSource’s SaaS Summit. Following a panel discussion on SaaS platforms, ZDNet’s SaaS blogger Phil Wainewright conducted a brief poll of about 250 software vendors asking the following questions (paraphrased):

1. How many people were considering building a SaaS offering using their own development tools and having it hosted by a 3rd party?
2. How many people were looking at a software+services approach?
3. How many people were considering Salesforce’s Force.com (this is the fun one)?

About 40 or so ISVs responded yes to question 1. About 10 responded yes to question 2. A total of 2 hands were raised for number 3. Salesforce.com’s world changing, hard hitting, hyped up, super duper, all encompassing SaaS platform picked up 0.8% of the vote! Now, I hate to poke fun but that is quite the entertaining number.

(bigger)

In a conference targeting and attended by software companies looking to build SaaS applications, and after a panel discussion titled “Platform Choices Will Define On-Demand Opportunity”, Salesforce’s Force.com pulled in less than 1% of the vote. That’s as close to a unanimous “no” as you can get. It sounds like that a certain group of ISVs made it quite clear that they can’t excercise their right to opportunity via that particular platform choice. Despite how this post started, I don’t want this to turn into a rant against Salesforce and Force.com. The purpose of this post is to breakdown why something like Force.com doesn’t make sense for ISVs (which might account for the poor straw poll turnout).

If you’ve been a SaaSBlogs reader for a while, you’ll recall a post I wrote a while back addressing the problems with Salesforce’s approach to platforms via Force.com (or Apex, or whatever the marketing term of the day was). Now that Force.com is active and pursuing market share, many of the same things I mentioned hold true. What would cause only two hands to raise? That’s easy enough:

1. Limited capabilities - People love to think that software engineering has become complicated “just because.” The fact is, the problems we tackle when writing software are signicantly complex and grow more complex each day. The concept of something like Force.com started off as an extension platform for Salesforce.com, and not a general purpose platform. It does a good job at letting you be a spoke on Salesforce’s wheel but if you need to build a complex offering outsied that wheel, it won’t fit your need.
2. IP & Business Risk – Salesforce expects you to capture your company’s bread and butter – the software’s logic -  using their Apex language. Furthermore, Apex runs only within Salesforce.com. If you’re a serious ISV, the idea that your IP is tied to some random language and that if you don’t like how your app is being delivered you can’t leave is a scary proposition. The fact that you can’t take your toys out of Salesforce’s playground and go home is a ludicrous concept and difficult to swallow.
3. Force.com is About Marketing Not Product - To be fair, Force.com does provide a good distribution model since you have the ability to tap into Salesforce’s customer base, but that’s exactly why Force.com was built. Force.com is used as a mechanism to bolster Salesforce.com core offering’s value proposition. It’s primary purpose is not to give you the power to build powerful SaaS offerings. From the distribution model standpoint, it makes sense to write to Force.com if you’re writing plugins and extensions for their CRM product. For full blown SaaS offerings, look elsewhere.

When looking at those who develop software, I see ISVs and “the others” (for lack of a better category). ISVs have complex issues and software offerings with specific intricacies, existing IP that they want to port to a new delivery model and do not want to be a puppet to some other companies growth goals. “The others” look for successful products to piggy back on and are interested in tacking on value to an existing product. Both are valid and lucrative categories. When looking at Wainewright’s straw poll, I don’t think Salesforce’s marketing can attract people from the former category because it’s a square peg in a round hole situation. They had a great idea when it came to Force.com as an extension platform, but IMHO that idea went down south when they tried to cram it down ISVs throats rather than focusing on “the others”.

Do you think that the small poll was representative of the sentiments of ISVs in general or not?  In your opinion, why might ISVs shy away from deploying their business on Force.com?

 

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