Beyond the buzzword: SaaS wanna-bes
By: Nick Mehta | Posted: 2009-10-13With apologies to Ginger, Scary, Baby, Posh and Sporty of the Spice Girls, if you "really really want" a software-as-a-service solution for email archiving, you often have to search through many wanna-bes.
One of the most common techniques for half-SaaSing one's way into cloud is for on-premise vendors to take license software and attempt to host it themselves or through partners.
Phil Wainewright at ZDNet refers to this as SoSaaS, or "Same old Software, as a Service."
The excellent analysts at Haut Tech put this as #1 in their spot-on list of "Ten Ways to Fail as a SaaS Company":
Your licensed product is very unlikely to be a good candidate for a SaaS product. This is a "test" of something you can never sell, maintain, operate or scale to reach a decent market. So - what are you testing? This is what is known as SoSaaS. Vendors of licensed products, especially high-value, line of business applications, typically aim their product at the top of their vertical market. It's just more cost efficient for sales and marketing. The product is loaded with features that satisfy that end of the market and tuned for skilled install by client IT personnel. If it penetrates the 100 top accounts - it's golden. SaaS products are built to sell and scale to a much wider market. If you can't do that you are very unlikely to recover your hosting and maintenance costs - much less further development costs in a SaaS model.
Having lived in both the on-premise and SaaS worlds, I fundamentally believe the business models and product development strategies are different. SaaS vendors can't force fit their way into the on-premise world and software vendors can't magically become service providers.
SaaS for email archiving requires product simplicity, usability and scalability often not found in on-premise solutions. In addition, on-premise vendors typically don't have the in-house experience in network operations, service level management and billing that is required for the second "S" in SaaS.
So if your on-premise software vendor tells you they have a new SaaS "delivery model" or "hosting capability," I'd take the Spice Girls' advice:
Now don't go wasting my precious time
Get your act together we could be just fine
SaaS Revenues: The New Darlings of Software
By: Joe Diamond | Posted: 2009-10-01Ray Wang, a partner at Altimeter Group, compiled revenues for some of the larger on-premise and cloud-based providers and discovered an interesting trend. In yet another tribute to Neil Patrick Harris, wait for it... SaaS vendors are seeing year-over-year revenue gains and on-premise vendors, on average... aren't.
Wang's analysis:
"Continued economic pressures force customers to choose best of breed and purpose built solutions. SaaS vendors appear to be the beneficiary as the overall business model aligns with client pain points."
This mirrors what we here at LiveOffice have been seeing within the industry as well. The cloud gives organizations the opportunity to implement solutions that remedy some of their most vital business needs (such as email archiving), at a price that won't have the CFO bawling while keeled over the books. This is all part of a compelling story that will seemingly keep the cloud sky high for years to come. We're just happy to be a part of it.
SaaS Security, the Age-Long Debate
By: Joe Diamond | Posted: 2009-09-17Michael Osterman of Osterman Research submitted an entry to Messaging Wire a couple of days ago about the misconception that the SaaS delivery model is less secure than your average on-premise solution.
He made some excellent points and did so in short order. The following two resonated with me:
- Education is the key. Take the time to help decision makers understand how secure (or insecure) their on-premise infrastructure and data transmission actually is.
- Help prospective customers to understand that their internal security procedures may be giving them a false sense of security. Is it particularly difficult for an employee to gain access to a server room and run off with a backup tape or external storage device? In many cases, it's not.
Osterman goes on to suggest that leading SaaS providers are able to offer better security because they have access to far more resources than most organizations do with their on-premise implementations. We couldn't agree more.
This entry is just a precursor to a study that Osterman Research will be publishing shortly. We're certainly interested in seeing and addressing the statistics associated with the security aspect of SaaS.
SaaS, It’s What’s for Dinner!
By: Amy Dugdale | Posted: 2009-08-27When I finished undergrad, my first job was doing investor relations for pre-IPO dot coms during the late 90s Internet boom. I'm not going to try and be casual about it - undeniably, it was cool. The concept of online search and e-commerce were brand new and SaaS was on the distant horizon. Back then, I had no idea that the day would come when I would count on the Internet for nearly all of my software applications. But that day is definitely here.
Mary Weier recently blogged about the fact that SaaS companies should "dog food" SaaS and we couldn't agree more. We are eating the SaaS dog food and it tastes pretty good - plus it keeps our internal systems lean. Naturally, we use our own Hosted Exchange 2007 as well as Personal Archive and Discovery Archive. We also use:
• Zuora for billing
• Salesforce for CRM
• Vanguard Vista & Survey Monkey for surveys
In marketing, we use SaaS applications to help us with our public relations efforts as well as lead generation and nurture marketing. Our HR department also relies on SaaS for benefits administration and other tasks - and we've also got a SaaS-powered knowledgebase.
So, overall - we are finding that the SaaS life is indeed the good life. Now, if only I'd been able to get in on the friends & family buy for the Amazon.com IPO 
Are You Risking Compliance in an “Unsecure” Cloud?
By: Stephanie O'Neill | Posted: 2009-07-01Two of the biggest concerns about cloud services are data control and security. While these are both very valid concerns, the security fear is also unsubstantiated (some vendors do have questionable practices about data ownership, but LiveOffice believes that every KB to TB of data belongs to its clients, and they can get it back whenever they want). Software-as-a-service (SaaS), or cloud, providers actually have some of the most advanced equipment and technologies on the market - much more high-end systems and safeguards than the majority of companies can afford on premise. After all, this is their livelihood. If they aren't experts at securing the data they store, they won't be around for very long.
Compliance goes hand in hand with these issues, but data stored on a vendor's servers is vulnerable to the same threats as data stored on your own servers. The important thing to note is that the best service providers are well equipped to deal with these challenges and minimize risk. Ultimately, they can do it more effectively than you can.
While there will always be naysayers, some feel that security is best left to the cloud. "SaaS is tailor made for keeping up with the rapid pace of malware development," says Cody Leser, senior director of channel sales at Trend Micro. "There's no way to push patch files continuously; you have to do it in the cloud."
Todd Fitzwater, principal at Demand Solutions Group, says, "Your data is actually getting taken care of in [service providers'] data center[s] better than in yours. The backup and recovery, disaster recovery and security around the servers is much tighter and higher grade than you would put in your own data center."
As with any major decision, companies need to do their due diligence and ask questions - lots of them. Where is the data being stored? What security measures are in place at each data center? Are the data centers redundant? Are the data centers monitored 24-7-365? What type of encryption is being used to protect data in transit? What type of infrastructure is being used to host the data? What type of spam-and-virus protection is in place? Can the data centers handle a sudden increase in demand? How often is data backed up and where are backups stored? Does the service provider enlist an independent, third-party vendor to conduct periodic security scans and other checks? What happens in the event of downtime or a disaster? What happens if the company decides to move its data elsewhere? What happens if the service provider goes out of business or sells to another company?
In the end, you need to make sure you are comfortable with the answers you receive. If there is any doubt about the security of your data, it's probably time to talk to another service provider.
If You Can’t Beat ’Em, Join ’Em … VARs Consider Benefits of SaaS
By: Stephanie O'Neill | Posted: 2009-06-29Whether you're drinking the Kool-Aid or shrugging off software-as-a-service (SaaS) as the latest fad, it doesn't appear to be going away anytime soon. In fact, according to an estimate from the leading industry analyst firm Gartner, SaaS (also known as cloud computing) will jump from $46.4 billion in 2008 to $150.1 billion in 2013.
As more and more companies begin to adopt SaaS, value-added resellers (VARs) must also consider the switch. But the decision is a little more challenging for VARs. First, SaaS requires VARs to completely change their business models, which is no easy feat. Some VARs also feel that SaaS threatens control of their customer relationships. And finally, the SaaS model takes longer to realize profitability, taking VARs from low-volume, high-margin products and services to high-volume, lower-margin sales.
On the upside, however, the quality of earnings with the SaaS model is higher with more predictable, recurring revenues. In addition, although the types of professional services VARs offer may also require some changes with SaaS, there is still a great deal of opportunity to provide value. Data conversions, project management, change management, training, system integration and software customization are still high-demand needs that offer tremendous business value. It's also important to recognize that VARs have a big opportunity to add value to up-and-coming hybrid approaches, for example, LiveOffice's partnership with Mimosa and Microsoft's software-plus-services model.
In the end, VARs need to be flexible and provide solutions their customers want and need. SaaS is a big player, especially in a down economy, and it's getting easier to sell as more and more customers begin to understand it and adopt it. So take notice, VARs, and decide where you see the future of your business. But as Francis Bacon said of innovation, "He that will not apply new remedies must expect new evils; for time is the greatest innovator."
One Man’s Take On Security in the Cloud
By: Dhaivat Pandit | Posted: 2009-05-21An article on Network World caught my attention - a surprisingly decent addition to the ongoing debate about security concerns with the software-as-a-service (SaaS) delivery model. I realize that it's a legitimate concern, unlike those of which pertaining to global warming.
Genetically designed to be skeptical of any buzzwords, I accept that cloud services need more scrutiny. The only entity that knows more about my personal tendencies is my email account, and naturally I want it to be secure. I shudder to think what it takes to entrust your billing, operations or human resources needs to a third party vendor. When the services we're talking about are email archiving and compliance, I can totally see where the general feeling of skepticism comes from.
From the viewpoint of a cloud-based company, I can say that we're all too aware of what's at risk and that we work tirelessly to ensure that we can provide a service that is secure and reliable. As Jon Brodkin mentioned in his article, multi-tenancy is an integral component of cloud computing services. You can be at ease knowing that we take every measure possible to ensure that you and ONLY you can see what belongs to... you. To quote John Hammond from Jurassic Park, "No expense is spared."
Hey! You! Get off of my cloud…
By: Nick Mehta | Posted: 2009-05-02LiveOffice has been offering hosted email archiving services since 2001. As such, we have evolved and grown under the radar, while the media constantly found new names for what we and our brethren do, including:
- Hosting
- Application Service Providers (ASPs - remember those?)
- Software-as-a-Service (SaaS)
- Cloud Computing
While each term truly has its own unique nuances, our business model itself has remained pretty consistent:
- No software or hardware to buy, deploy or manage
- Predictable pricing per user per month
- Securely delivered over the Internet
- Automatically patched and updated
Since cloud computing is the latest label for our industry, we are now going through the predictable hype cycle that all of us have seen many times before:
- Initially: This could be big
- Shortly thereafter: This is going to change everything
- Around the same time: Everyone is going to use this
- Upon reflection: Well actually, no one is going to use this
- At the same time (from the other side): No wait, some people will use this and are using this
- Much later: Wow, almost everyone is actually using this
Think about it. Remember the articles you read about the Internet in 1995? The initial predictions were overblown. Then people said it was dead and a fad during the dotcom crash. And now look at how it has blown past most of our wildest imaginations.
In the same way, businesses leveraging externally-hosted IT solutions, versus running IT systems themselves (which is what hosting/ASPs/SaaS/cloud computing really is) is going through the same natural evolution.
Consulting firm McKinsey & Co. recently released a report on cloud computing throwing water on the flames of the hype. One of the key findings, that generated tremendous controversy, was as follows:
Clouds already make sense for many small and medium-size businesses, but technical, operational and financial hurdles will need to be overcome before clouds will be used extensively by large public and private enterprises
As someone benefiting from the growth in cloud computing, you know what my response is to that? I agree. 100%.
It's obvious, isn't it? Cloud computing is a new area and, by definition, "hurdles" will need to be overcome. If there were no hurdles, it would not be new. I'm not sure why that is surprising to anyone.
In fact, I believe in this trend so much that I want the hype to be contained, because the hype obscures the real trends taking place under the covers - namely:
- Small and medium-sized businesses have largely had no good options when it comes to IT infrastructure, given their scale and expertise. Cloud computing finally levels the playing field. And although "small" business sounds like a tiny market, it's anything but that.
- At the same time, I am amazed by the number of large companies who, despite knowing all of the hurdles and barriers alluded to above, are still finding cloud-based solutions to be worth the trade off.
So let's get the cloud computing hype over with, because the reality is too promising for us to ignore.
Gartner: Cloudy days ahead for on-premise email tools
By: Nick Mehta | Posted: 2009-04-11As organizations move their email systems into the cloud, to systems like Hosted Microsoft Exchange 2007, what does that mean for the various add-on tools used in the email environment (e.g., email security, email backup, etc.)?
Gartner recently published a report forecasting tough times ahead for on-premise email tools:
The analyst house has suggested that expected pace of adoption of e-mail software as a service platforms threatens the livelihood of the vast e-mail third-party vendor community.
Hardest hit will be applications which help protect, secure and stabilise e-mail systems, it has said.
Gartner has described how vendors currently providing some of the premises-based systems that are not necessary for SaaS implementations could be impacted by the shift in favour of software services.
We're excited to help clients in this transition, enabling them to start with cloud-based email archiving and email disaster recovery and then moving them to cloud-based email itself.
Beyond the buzzword: SaaS and migrations
By: Nick Mehta | Posted: 2008-12-19TheRegister reportedthat EMC is shutting down its main (Belgium) development center for its archive storage offering, the EMC Centera.
While EMC denies that this means the end of life for EMC Centera, it's certainly made a number of EMC archive customers nervous:
Taken together, these executive moves and the closing of the Mechelen Centera development center suggest that the Centera product could be approaching its end of life.
So what does a customer do when their archive storage is EOLed? They are forced to find a new storage vendor and migrate all of that data (often terabytes worth) to the new platform. For cash and time-strapped IT departments, this can means hundreds of thousands of dollars of unplanned cost and hundreds of hours of unplanned time.
And the fact is that since most customer keep archive data 3, 5, 7 years or more, they will eventually be forced to migrate their data - whether because a vendor EOLs its products or because they need to upgrade to newer storage.
I think this is one of the significant yet subtle benefits of software-as-a-service for email archiving. Clients can be rest assured that their data is always available at a predictable monthly cost without worrying about moving it around constantly.
So EMC Centera customers, we're glad to bail out your Centera with our TARP program.
