Monday, May 4, 2009

Why the Akamai-OpSource Mash-Up Is Important -- to SaaS Vendors AND Users!

You may have missed it in all of the recent SaaS-related hullabaloo, but back on March 30, Akamai and OpSource announced a joint relationship that had actually been in place since late 2008. The companies have been working on joint solution offerings that combine OpSource's Web operations management and optimization services with Akamai's high-performance, highly reliable application and content delivery services and worldwide facilities. (If you're a quick and focused reader of your Web browser's status bar or its equivalent, you can see many major Web sites actually pulling content from Akamai servers as those sites load.)

Now, other SaaS infrastructure solution providers are focused on making the technologies work and keeping them working – incredibly worthwhile goals, make no mistake. However, the Akamai-OpSource alliance is really focused on providing a more business-centric infrastructure. The two companies are offering the delivery, hosting, and operations services that let SaaS solution providers focus on what they (should, at least) do best – delivering good software.

Akamai also announced access control and customer visibility enhancements to its Web Application Accelerator service. The improvements are intended to ease access to Akamai-hosted SaaS and Web-based solutions from behind corporate firewalls, and to tell SaaS solution providers more about what their users are and aren't doing with those solutions.

Taken together, I think these announcements address two parallel sets of needs in ways that are quite effective. Akamai, especially in concert with OpSource, is helping to deliver levels of visibility into SaaS solution delivery that makes that process more reliable and easily manageable. At the same time, that visibility is reducing the “FUD,” or “fear, uncertainty, and doubt” still plaguing some SaaS skeptics. You can not only see when and where things break or go wrong (a technological focus), but you can see how well things are working when they are working well (a business focus).

I'm a big fan of both Akamai and OpSource. I think their alliance is a harbinger of good things to come for SaaS vendors and users. If you're one of those users, or considering becoming one, by the way, you should start immediately questioning current and candidate vendors about their use of or response to the current and likely forthcoming results of the Akamai-OpSource alliance. Those taking advantage of alternatives such as the alliance's offerings may stand a better chance of avoiding problems that can cause disruptive or fatal challenges to all but the strongest SaaS vendors – as I've warned here previously. (To see what I said, please see “Enabling the Inevitable: Selecting Strong SaaS Providers” and “Are Your SaaS Vendors in Trouble? And If So, What Can/Should You Do?” -- and let me know what you think.)

Oracle's New SaaS Offerings: The Last Nail in the Coffin for "Bits on Disks?"

What a difference two weeks, 10 months, some acquisitions, and an economic downturn can make.

Two weeks ago, I opined in this space that Oracle's acquisition of Sun Microsystems could soon result in some new SaaS offerings. And last June, Larry Ellison was widely quoted as saying SaaS offerings weren't profitable enough -- although he was also widely reported as expecting that to change.

Well, it's changed, at least according to today's Oracle-related news stories. They seem to indicate that Oracle is planning to launch several (maybe seven?) new SaaS offerings really soon, according to stories in The Wall Street Journal (subscription required for full access), at VNUnet, and elsewhere. And I believe'em.

Since that June 2008 conference call with Larry Ellison, Oracle's launched a new release of its CRM On Demand solution, and Oracle Sourcing On Demand, a SaaS tool for supply management. And its Oracle On Demand Web site claims 4.5 million end users.

Oracle is serious about SaaS. And that means all the other SaaS and cloud computing solution vendors had better get ready for some aggressively serious competition. This should benefit users in terms of broadening choices and perhaps creating opportunities for advantageous contractual negotiations. But it is likely to get rough for those solution developers and providers without deep pockets, loyal, evangelical customers, or both. Such vendors are likely to be acquired by Oracle, acquired by some other larger and more stable vendor, or to disappear. Which won't be good for those users who've bet their companies' competitive agility on those vendors without sufficient protection, as I've discussed here previously.

Given Oracle's latest and anticipated SaaS moves, Microsoft's continually evolving SaaS/cloud strategy, and everything and its partners do, the next 12 to 18 months could be the most interesting and challenging for SaaS and cloud computing users and vendors since...well, since the last 12 to 18 months.

So, as I advised two weeks ago, stay tuned. And feel free to let me know your thoughts, hopes, fears, and plans in response to all of this, if any. And you might consider reducing or eliminating as many long-term commitments to and investments in traditional software licenses as practical for your organization's particular needs. While the future of SaaS and cloud computing is roiling, the future for most traditionally licensed "bits on disks" seems certain -- and limited at best.