Enterprise SaaS != Web 2.0: A Quick Hosting Perspective

Sep 10, 2007 by Matt Ammerman

I like a good mystery just as much as the next guy, and this story’s got it all.  If you haven’t got the time or interest to read the whole forum thread, here’s the synopsis:  Jatol.com (no hyperlink provided because of said mystery), a notable web hosting company seemingly popular with development crowds has simply vanished.  Literally.  Websites down. Domain missing. Phones disconnected. Believe it or not, even the owner is missing! 

At this point, there’s not even a support number to call and Jatol.com users aren’t even able to retrieve their stored data or web site files. As I read further down the discussion chain, I started thinking about how awful it would be if I were running a web-based business in a situation like this – the mere thought of surmounting catastrophic shutdown such as this is mind boggling.

While it may seem obvious to some, this story specifically highlights a very important part of what enterprise SaaS ISVs should look for in managed services: providers that can assert serious service level agreements and back them with real ramifications.  For instance: transparent multi-tiered redundancy, consistent and thorough backups and archives, potentially even software and hardware escrow services (see ‘catastrophic shutdown’ above). The bottom line is that hobbyist devs hosting websites or even working applications with reliable hosting companies count downtime in minutes, while enterprise count downtime in thousands of dollars.

The tricky thing about SaaS is that it fundamentally requires the ISV to at least purport to be the ‘provider’ of software.  While hosting may be outsourced and ISVs become at least the ‘P’ in ‘MSP’, it is vitally important that the backing ‘MS’ be up to par.  If you’ve dealt with an MSP (without naming names) and had service level ‘experiences’, what are your thoughts on MSP preparedness for SaaS?  Are MSPs ready to host enterprise SaaS applications that generate the aggregate load of potentially millions of ISVs’ users?

[poll=6]

 

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Is there room for a SaaS hardware play?

Aug 1, 2007 by Sinclair Schuller

I recently had a conversation with a friend regarding SaaS and hardware VARs. The topic came up because this friend noted that hardware VARs will undoubtedly feel the SaaS pinch: if enterprises start overwhelmingly subscribing to software rather than purchasing it, they buy less server-oriented hardware. Although providers will be buying the hardware to host the SaaS offering, economies ought to consolidate the amount of hardware necessary to provide the same amount of functional utility. This chews into the total market revenue. But does this have to be a “net loss” game? Absolutely not!

 SaaS, aside from all of the business driver gobbly gook, does one thing very well: it mobilizes data and functionality since by nature SaaS lives in the cloud. Hardware VARs need to exploit that. Through creativity, endpoint hardware devices that integrate with in the cloud services can become a very lucrative market. Take a logistics SaaS offering and GPS devices, or an inventory control SaaS offering and lightweight mobile laptops with integrated scanners, for example. I think traditional VARs would do themselves a favor to spread out some and into these endpoint offerings rather than focus on the “next big server sale.” It seems that diversification will be the key. Any thoughts?

 

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