What's the difference between SaaS and Cloud software?

The line is somewhat blurred, but there is a line.

Would be best to describe it by looking a few years back, when we talked about ASP (and wondered why ASP never realy cought on).

ASP was about using an EXTERNAL package - this package included the hardware, database and application, all bundeled together as a package with maintenance services.

The advantages: outsource what you don't need inside. No need to manage hardware and maintain the application.

The drawbacks: TIMING (ASP came a bit too soon to the market), the core idea is good but inadequate security technologies and communication barriers (bandwidth) made it a risky choice for many organizations. Another main issue with ASP is that it's a single application that can be used by many, no customization, no changes, it's a "vanilla", take it or leave it package.

SaaS had much better timing. Everyone are now talking about it, it makes a lot of sense, and many of the technological barriers are gone. As organizations embrace new architectures such as SOA, it is becoming as a more viable option. But the more importnant thing is that while SaaS is a multi-tenant configuration, it does allow organizations to make SOME changes and customization. They don't have they're own specific application, but they can have an ISTANCE of their application, sharing the infrastructure, platform and application layer with other tenants.

Cloud software will be another development (we are now witnessing its growth). Cloud provides the "missing link" and it is the control of the data and of the application. In previous models - ASP and SaaS - organizations have no/limited control of their data. In SaaS they don't realy control the data or the application, they are consuming services and don't realy deal with the content of the services or how they are delivered. Cloud software brings the control back to the user organization, it can have it's own "cloud" (on or off premise). It can develop its own application from scratch (using PaaS - Platform as a service tools).

But cloud software will not eliminate the need for SaaS, both models will have a place: SaaS will become a model more suitable for commodity-type or lightweight processes, and Cloud will enable organizations to run heavier, core processes.

IaaS (Integration as a Service) is anothe piece of the architecture that will become more and more needed, as organizations adopt these solutions and will need to integrate them, as well as integrate them with internal, legacy, on-premise applications.

There is a very high chance that this is not the final phase of the evolution.

Thoughts about disruptive technologies

During 2007-8, SaaS and Web 2.0 disrupted the applications market:

SaaS presented an alternative model for application consumption, and Web 2.0 presented a set of new practices and tools for internal and external collaboration.

During 2008, Social Software and Open Source Applications also started to undermine existing models. Both these areas rely on economies of scale and provide more value the more people use them. Social software is gaining much attention in the global market, while most Israeli organizations aren’t even aware of the possibilities of using these models within the organization walls. We recommend CIOs to start thinking about how social software can help promote their organization on the one hand, and on the other - improve internal collaboration within the organization.

Open source (OS) software is also not yet a hot topic in Israel. While a Cutter IT Study (2008) suggests that 65% of global organizations are already using some kind of open source software, most Israeli organizations we have talked to aren’t considering using OS tools and much prefer the traditional “proprietary” software model mainly due to local support issues. Lately some organizations have began to express interest in open source applications for very specific and limited needs: Electronic Forms, Blogs, Wikis, Search. As one of the IT managers I spoke to told me recently: "open source apps are ok for the internal, IT stuff, but I would never provide open source apps to business users, it's too risky".

SaaS has finally started to enter the Israeli market during 2007 slowly, but surely, mainly due to Salesforce.com’s entrance to the Israeli market. However, there isn’t much activity in the SaaS market besides this vendor. Most user and vendor organizations are still waiting to see what happens in this market before jumping in.

What about cloud computing?

There's no doubt that the current economic situation will do a lot of good for the "cloud concept". Cloud computing, which is essentialy "anything as a service" (XaaS), will fit very nicely into the new paradigm: Service instead of Products.

We don't hear expressed intentions of organizations to start using the cloud for their software/platform needs, but I think that once the services are available, they will attract organizations. The reason will not only be managing costs more easily (cloud services will be considered an expense), but also simply taking all the "headache" out of things that are not in the core business of the organizations, or, in other words - commodity.

Sound familiar? Exactly the same arguments for outsourcing, except today outsourcing is not an "issue" anymore. The same thing will happen with cloud computing. A few years from now, mail and calendering services will mostly be provided through the cloud, as well as other "commoditised" services that the organization doesn't want or need to fuss around.

מה זה בכלל Cloud Computing?

כמו בכל תחום חדש והייפי, בשלבים ההתחלתיים של השוק יש בלבול מושגים, ואותו מושג משמש פעמים רבות לתיאורים שונים שמאחוריהם כוונות שונות לחלוטין.
אותו הדבר קורה עם Cloud Computing. אנשים איתם אני מדברת על התחום מגדירים Cloud Computing לעתים בתור ה"דור החדש" של התוכנה כשירות (SaaS - Software as a Service), לעתים אנשים מתייחסים לנושא זה כ"מחשוב כשירות" - כלומר, האפשרות לעשות שימוש במשאבי ותשתיות מחשוב בתצורת שירותים.
השבוע נתקלתי במונח שלדעתי מתאר את ה Cloud Computing בצורה הטובה ביותר, וממחיש את גודל האמורפיות של מושג זה: "Anything as a Service" או בדרך הקיצור: XaaS.
המאמר המספק הגדרה זו מתאר מצב בעתיד בו המיקום בו נמצאת תוכנה כלל לא ישנה, ואף מתאר מצב בו מי שכן יחזיק תוכנה אצלו "בבית" ייחשב לבזבזני מכיוון שיהיה עליו לתמוך בתשתיות המחשוב התומכות באותה תוכנה בעצמו.
לדעתי, חזון זה הנו אפשרי. מערכות המידע העתידיות מתפתחות בכיוון זה, המחסומים הטכנולוגיים מוסרים לאט לאט, מניעים נוספים כגון הגדלת הניידות, שיפורים באבטחת המידע, התפתחות ארגונים לכיוון ארכיטקטורות SOA, וכן הסרת המחסומים הפסיכולוגיים, כל אלה תורמים להיתכנות של הפיכת מודל Cloud computing למודל שישנה את מערכי ה-IT של ארגונים בתוך מספר שנים.
בחו"ל כל מספר חודשים נערך סקר שמראה עד כמה ארגונים מאמצים תוכנות/מחשוב כשירות, ואחוזים אלה גדלים בקצב מהיר. לדוגמה, קצב אימוץ תוכנות כשירות בתחום ה-CRM הרבה יותר מהיר מקצב אימוץ תוכנות CRM כשירות.
אבל לא מדובר רק על תוכנות, מדובר על סביבות מחשוב שלמות המסופקות כשירות, כולל סביבות פיתוח בתוך ה-
"Cloud". אין ספק שכאשר IBM, גוגל, אמאזון, DELL, Salesforce מחליטות להשקיע כל כך הרבה כסף, שחלקו כרגע מושקע במחקר ופיתוח, בתחום ה Cloud Computing, התחום הזה עוד צפוי להשפיע רבות על הדרך בה נשתמש ונצרוך משאבי IT בעתיד.

ניתן לצפות במצגת של ג'ימי על התחום כאן.

When and Which application vendor will Google acquire?

Google is very serious about the applications market and is aggressive with pushing and further developing its Google Apps. Its vision for the applications market is to develop consumer oriented applications delivered within the “cloud” or simply put: software delivered through a browser and accessed from anywhere.

In my opinion, now is a right time for Google to make a further step in its applications strategy and acquire a vendor that can fit well into its cloud computing vision.

Lately we have heard about partnerships between Google and application vendors that share a common Cloud Computing vision. The first one is Salesforce.com, the second one is much smaller but so familiar in the Israeli market - Panorama. Does that mean that Google will make the extra move and acquire one of them? Let’s check these 2 options:

What if Google buys Salesforce?

Is Salesforce.com a possible acquisition for Google? This type of “strategic” acquisition It is definitely a possibility. Salesforce’s SaaS offering as well as their Web 2.0 initiatives (for example, AppExchange) offerings fit well into Google’s application vision as a “good option” to traditional application vendors’ software models. Salesforce and Google believe in the same model: software delivered through a browser and accessed from anywhere, or In other words, software delivered through the “cloud”. Salesforce can act as a good sales channel for Google Apps, Google is already doing a great job in consumers and enterprises’ advertising, but it can definitely use SF’s experience in selling software for the enterprise (the current partnership between Google and Salesforce is already doing exactly that - expanding Google into enterprises). Rumors about the possibility of Google acquiring Salesforce were already running around from about a year ago and pops up every now and then.

However, even if Google decided is does want to acquire Salesforce, it won’t be so easy, Oracle and Microsoft are likely to get into a bidding war. This will also be VERY EXPENSIVE acquisition, in a recent report by “451 Group” research company the evaluated cost of acquiring Salesforce.com these days can be around $10 Billion, that’s a very expensive price to pay.

What’s in it for Salesforce?
Some people say that the time is right for Salesforce to sell. It has made its mark and actually disrupted the software market. The SaaS model is now becoming quite common, and “traditional” vendors are starting to catch up – Oracle, Microsoft, SAP.

What if Google buys Panorama?

This is a very difference scenario. Acquiring Panorama would be a technological acquisition and a small one for Google to handle. It would provide Google the ability to incorporate dashboards and business intelligence on top of its apps (BI has become a must have piece of ANY application package).
Panorama recently partnered with Google and is investing a lot in this partnership. The interest from Panorama is very clear: Panorama had a stream of incidents that forced her to change its business model a couple of times (Microsoft’s acquisition of Proclarity, SAP’s acquisition of Business Objects). The traditional BI market has changed dramatically lately due to the major vendors’ aggressive acquisitions into this market. Panorama HAD to find something new, something that will position it as a faster, more innovative player in the BI space. In this respect, the Google partnership is great for panorama, and lets it move elegantly into could computing space by delivering BI on demand. On the other hand, Panorama is a Microsoft technological partner, the partnership with Google already puts it in a delicate position of partnering with 2 rivals - Google and Microsoft.

So what’s next for Google Apps? Google seems very determined about the applications area, I think several acquisitions are going to happen but it will have to be either point-specific, technological acquisitions that solve a particular issue (for example, an email encryption vendor called Postini that Google acquired in order to make their on-demand mail offering a more viable option for enterprises), or a large strategic acquisition that fits right into its application through a cloud vision (main visible one seems Salesforce but it can also be one one of the other on-demand players).