Is it about SaaS, utility computing etc or is it about consolidation

I took the opportunity to stand back and look at some of the major trends in IT. When I did that one thing became very obvious. All of the major hype cycles apart from the Semantic web and social networks were about consolidation.

 

Think about it. virtualisation, multi-tenancy, SaaS, Cloud computing, the Gdrive… Even Skype is about consolidation, they are aggregating and virtualising networks for callers, hence consolidating the telco market virtually. (as an aside my tablet recognised the word virtualised as brutalised – how ironic!!)

 
Are we really just seeing a backlash against distributed infrastructures? Is the yang of bureau computing finally evening out with the ying of distributed models? Is it the unspoken or unrealised need to get scale in a truly global market? Is it about the massively increasing complexity that IT poses. Is it that there is finally a form of outsourcing (BPO, or discrete) that can actually deliver on its TCO promises. I still hold to my opinion that SaaS is a form of outsourcing.

Probably all of the above combined with new technologies that facilitate this type of computing at an economically viable rate.

The point is that to me, the trend isn’t about SaaS or cloud computing, it is about consolidation or centralisation. Does that realisation change the game? Possibly, maybe I start thinking about the implications of the market and its related markets.

Its amasing how overweight the US is in the Blogsphere

At first i thought it was a fault in my feedreader. But after quick perusal of some of the blogs I read I realised that its Thanksgiving in the US.

The thing that struck me is just how much influence the US has on opinion, commentary, finance and our world social graph in general. For 300 mill people, or just 5% of the population they certainly fight way above their weight class on all of these factors….

I'm not bashing, honest. But I am left wondering if all this influence by a statistically minority is a good thing?

Perhaps its social, language barriers, or the adoption curve in action. Where are the Europeans? Asians? Africans?  South Americans?….  I'm positive there is a bunch of smart people there doing smart things with relevant views there too. 

So what happens to SaaS if the internet fails?

I haven’t read any commentary on these two articles claiming that by 2010 the internet will be so congested it will start to slow. So I thought I’d throw my hat in the ring.

"Users will experience a slow, subtle degradation, so it's back to the bad old days of dial-up," Nemertes President Johna Till Johnson told USA Today. "The cool stuff that you'll want to do will be such a pain in the rear that you won't do it."

(As a by-line a bunch of nethead telco guys have been hoping and / doing their best to drive just this sort of situation for a long time)

 
If this does happen – and I’m not entirely sure it will – It’s an interesting paradox. Many governments and markets have regulated Telco’s to a point where they are really under the hammer financially. And now, they are being asked to fund an internet up-grade of immense proportions so that the internet (which effectively ‘ate their lunch’) can continue to work as well as it currently does. This will of course make everyone more productive (youtube being the best productivity aid by far – check the comments) and the world will be a much better place…

The degradation of the internet also has large implications on SaaS and the whole web 2.0 phenomenon. As the quote above indicates, the service experience will degrade to a point where users will walk. Let’s face it, no one ever, says ‘give it to me slower’. Sure ISV’s etc can create cute codecs to do compression, thin client could help as well, but the reality is that this kind of negates the point of mashupable Internet delivered services.

It does point to a gapping hole in the SaaS provider’s end to end service experience. It’s kind of like building a cool race car while not thinking about the terrain it actually rides over – a formula one on an off terrain track in this instance. This omission also points to a massive opportunity for those ICT companies who understand how and why you need to couple connectivity and applications together.

I’ve written before about who it could be that would disrupt the old school on prem ISV business. It looks to me like the landscape has changed again….

Anyone else have any thoughts on this? Anyone else even alarmed that this could impact their SaaS service or customers?

Others are thinking SaaS and social networks

Ok, i know i'm harping on but the coincidence here is more than astounding.

 From my mornings RSS feeds comes instructions from the MS CRM Dynamics team on integrating CRM 4.0 with Facebook. This is exactly what i pointed out in my mis-spelt post of Friday .

The key is marrying the two together in a way that makes sense. Collaboration is one, CRM could be another (facebooks friends function could be called a rudimentary CRM system after all

In a back channel conversation with Ben Kepes, he wasn't surprised at all by this . Saying that this is just mashups in its next evolution and the way of the future…

Perhaps thats more the point of this series. Maybe convergence isn't between different taxonomy…its in the application mashups and the only constraint is the programmers imagination… that and where the money is. 

 

Ops, spell checker got me

Sorry for the spelling errors in the last post . I'm trying to use a tablet. Obviously with limited success…

 The opening line for that previous post should have read 

Earlier this week I posted my thoughts on what I saw as convergence between SaaS and social networks. I listed out some striking similarities between the two. Then on the back of a comment from Bob Warfield I wavered in my views. I was wrong.

Evidence of SaaS in social networks

Earlier this week I posted my thoughts on what I saw as convergence between SaaS and social networks. I listed out some striking similarities between the two. Then on the back of a comment from Bob Warfield I wavered in my views. I was wrong.

Today I see on Read write web this example of a collaboration tool being offered through facebook.com. This is a perfect example of convergence. It makes sense when you think about FB’s roots. University based social networking is now colliding with team based projects “-viola a hosted collaboration tool in a social network". The Myoffice product that RRW mentions looks and sounds massively like Zoho and Zimbra. Why can't this work for me? I’m a business user I have a FB identity and occasionally want to do projects “collaborative projects” with other FB users. Isn’t it nirvana to have one place to be a consumer and business person. Micro businesses or SOHO are by definition 1 man band, just how you distinguish between me as a one man band and me as a one man socialiser is a moot point. I will want consumer services and business services when and where I want them and if I can get them from the same place, isn’t that a better thing?

Another point I want to mention, why can’t SaaS be consumer focused?  Isn’t internet banking a [clunky] SaaS application?  It completely disrupted on premise banking and its consumer focused. Gmail is a classic example of this as well, clearly its trying to extend upwards into the SMB space.

I reiterate that the platform as a service play spans these two phenomenon. And to my mind we have a uniquely paradoxical situation. SaaS vendors have the applications and in some instances like Force.com the platform. While Social networks have the mass user populations. The key is marrying the two together in a way that makes sense. Collaboration is one, CRM could be another (facebooks friends function could be called a rudimentary CRM system after all – and its great for doing reunions etc)

The three key unifying forces here is the internet as a channel, getting holding and using identity and the mashup platforms being developed.

Are SaaS and social networks the same thing?

Perhaps the correct question is,” will they be the same thing?” IT people love to categorise things, It helps us organise and understand a very fast changing and increasingly complex world. Sometimes though, it doesn’t always do us any favours.

I think that there is convergence between SaaS and social networks (effectively making them the same ‘thing’). I think that this will become increasingly the case. Here’s why.

 Both are webware or internet delivered services. They are both heavily influenced by web 2.0 technologies. The good ones both allow for mashups and user generated alterations. In the SaaS world they are increasingly addressing the integration with other applications and platforms. Social networks are all about PaaS (integration) and only recently have they been about applications. Both need scale to be successful and in both cases scale is about eyeballs and identities. This make sense as revenue and increased market value is driven by these two factors. They share similar user patterns too. Unlike traditional Software which you use because you bought it (or someone else did). You pay for these services because you use them! And….the more you use the application or network the more you continue to use it (its quite self fulfilling). There is value to both of bringing in networks be they suppliers or friends. Both are a real Trojan horse. I mean why would you, or how could you move when everyone you knew is in one place? This is especially true if it was you that invited them in…

Both are trying to address the same financial hurdles; that is what is what is my value and how do I make a profit. Similarly, standards are only just emerging. Google’s Opensocial , Force.com  and the Microsoft SDK announcement are all indicators of this.

Any way you get the idea. I think we should stop thinking about these two web 2-0 trends as distinct entities and start viewing them as a converged offering. I doing so you expend your market mindset, develop in different ways and treat users in a different way. The perplexing thing will be how we manage the identity collision I that is what happens when a consumer becomes a business person and via versa …

Microsoft SDK’s for their Live platform

With all the hoopla this week about Google's OpenSocial play (which is great!), i'm willing to bet that this announcement by Microsoft about them delivering a beta of the Live SDK went practically unnoticed. 

I agree with Mary when she says

 

It’s surprising to me how little Microsoft is doing to publicize the Windows Live APIs and tools that it is making available to developer .

 

I've written before about what a big move this is in my opinion. I think it would be a brave person to write off Microsoft in the SaaS space purely because  of their experience in building a strong developer community and using this to their advantage. Granted they have a lot more competition – Google, Force.com and Facebook.

As ex-pat Kiwi (couldn't resist) Troy notes , other large ISV's are struggling with the disruption that SaaS poses. In my dealings with them, MS is doing the same. Schizophrenic is the word that springs to mind. But their moves in the SaaS space are undeniable and given this move, i reiterate. MS will be a serious player in the SaaS space


 

Apparently its not about price

  

This slightly sullen piece today from the slightly leftist news paper the NZ herald. According to them (and I’m willing to bet, most frustratingly) NZ broadband prices aren’t the inhibitor to our BB uptake ‘issues’- that is we aren’t in the top half of the OECD average for Broadband uptake.

 At US$16.75 per megabit, New Zealand broadband prices are US$1.25 cheaper than the OECD average and US34 cents less expensive than the OECD average of US$49 when comparing monthly subscriptions.”

 

So lets look at the reasons this could be occurring besides blaming the incumbent telco (the usual routine).

Could it be our taxation levels on companies affecting their willingness to purchase services? Could it be that the average NZ company is way smaller than the rest of the world? Could it be that the NZ population over a country this size might mean we don’t have the density to drive faster broadband. Could it be that we would rather support our commodity products like forestry, milk products and meat industries than invest in the knowledge economy? Could it be that we can’t train, retain or attract enough skilled workers to do this anyway? Could it be that we have to import so many raw materials to manufacturing anything?

 

Or could it be that the whole beating that the government has given Telecom is a massive political exercise designed to win over voters and deflect enquiry into other topics such as the above?

Isn’t the whole intention of the digital strategy of the government to raise our GDP levels relative to its peers? If that’s so isn’t there a bunch of other things that the government could be doing like lower taxation and compliance costs. Subsidies and funding for innovative companies. Set up established methods for bridging the geographical divide we face? How about doing something radical like supporting a new age of transportation (less reliance on oil) by becoming the ‘Japan’ of electronic car manufacture?

I don’t know what the answer is but ‘separation so we can have more competition and more investment and cheaper broadband’ doesn’t appear to be the answer….