Pop quiz.

Who is the second largest software company in the world?

Who is the second largest provider of on-premise email & collaboration software?

 
The answer to both is IBM. The interesting thing about IBM is that they have been virtually anonymous on the SaaS front. Up until now that is.

I recently attended a seminar co-hosted by IBM & Saugatuck on SaaS. For the most part this was a bit of a disappointment (I’ll describe the IBM play in more detail below). The most interesting thing was the declaration of IBM’s own SaaS plans code named ‘bluehouse’. Interestingly this isn’t top secret, IBM has told the world all about it, it just hasn’t been picked up.

Collaboration services delivered on the Web
"Bluehouse" is the code name for a future software as a service offering from IBM designed for companies with five to 500 employees. "Bluehouse" extends the value of the Lotus Foundations family by providing extranet collaboration services for open social networking, instant messaging, file sharing, project management and web conferencing.

The suite outlined by IBM is very comprehensive, much more impressive than MS’s somewhat disappointing announcement of last week & includes email, unified Comms, document shaving, social network applications, video collaboration & a bit more.

Various aspects of blue house are very interesting. Firstly in a SaaS world the barriers that notes has in getting into an entrenched MS go away. Secondly brand value means that to many corporates this is a credible alternative Thirdly IBM hasn’t really got a lot to loose. This article (which is 3 yrs old) claims notes had 23% market share (which just feels way too high). The point is IBM is loosing the email race. But now with SaaS they could tank the price of email etc & get back in the game in fairly short order. Fascinating play that should definite spice up the email wars.

As an interesting aside. Go to the Software top 100 site & type in Google…. What docs that tell you???

 
More on the IBM SaaS model.

 
IBM appear to have done the math & realised that SaaS is actually quite threatening to their core hardware & software business. The rationale? In a SaaS world the ISV builds their ‘stack’ only once & will likely never move. That is the buying decision for H/W & S/W is centralised & baked in. So vendors like themselves miss out on all the business on-prem software drive & if they don’t get the ISV on their platforms ( DB2 , websphere , hardware etc) at initiation there’s no way back in.

So IBM’s play is to get to the SaaS vendors at start-up. Kinda boring but pretty real I guess.