SaaS Archives - Page 10 of 12

Software 2007: Plattner to Turn the SAP Mothership Again

Posted on May 9, 2007 ·

For half an hour or so I felt I was back at University at Software 2007 – in Professor Hasso Plattner’s class. That’s because his keynote was a compressed version of his recent SAPPHIRE 07 speech, which in turn was an “offsite class” for his Stanford students – literally so, he flew the entire class out to Atlanta. To make his point, he used the blackboard-metaphor, with chalked handwriting (and dressed in matching black).

I don’t normally enjoy keynotes, but found this one fascinating: it was about a lot more than most in the audience thinks – more on this later…

The “lecture” was about his New Idea for enterprise software – more than an idea, it started as a side-project about 5 years ago, then about 3 years ago they realized they can’t do it with one codebase.. so it became a completely separate system from SAP’s current business suite. They kept the project secret as long as they could, but this year they started to talk about it: it’s code-named A1S, and currently 3000 people are working on it (For comparison, Salesforce.com has less than 200 engineers). It will be On-Demand, and not a point-solution, but a full-featured, integrated business solution, as one would expect from SAP.

Some of my raw notes on the key concepts:

On-demand: Google, Salesforce.com showed it works. Time now for the whole enterprise to run in the cloud. Very small footprint at customer.
New markets: small business customers.
Key difference: user-centric design. Iteration, version 7 of user interface already, it will be 8 or 9 before it launches. Every single functions delivered either by browser or smart client. They look 100% identical. Office (MS) client, Mobile, too.
Separation of UI, App, Db – physical sep, multiple UI’s for same App. Front ends very specific to industries. Portal based. Company, departmental portal. User roles. Multiple workplaces. In smaller companies users have multiple workplaces. High degree of personalization.
Event driven approach. Model based system. Instead of exposing source code, expose the model. Not just documentation, active models. Change system behavior through models. Very different from SAP’s original table-based customization. Completely open to access by/ to other system. 2500+ service interfaces exposed.
The future of software design will be driven by community. SDN 750K members, 4000 posts per day. We’ll have hundreds of thousands of apps from the community. Blogs, Wikis, Youtube.
In-memory databases. Test: 5years accounting, 36 million line items. 20G in file 1.1G compressed in memory. Any question asked > 1.1sec. There is no relational database anymore. Database can be split over multiple computers. Finally information will be in the user’s fingertips. Google-speed for all Enterprise information. Analytics first, eventually everything in memory.

For a more organized writeup, I recommend Dan Farber’s excellent summary, and for the full details watch the original SAPPHIRE 07 Keynote (after a bit of salesy intro).

As it became obvious during the post-keynote private press/blogger discussion, most in the room thought Plattner was talking about the mysterious A1S, SAP’s yet-to-be-seen On-Demand SMB offering – although he made it clear he intentionally never used the A1S moniker. I think what we heard was a lot more – but to understand it, one has understand Hasso Plattner himself. No matter how his formal position changed, the last active SAP Founder has always been the Technology Visionary behind the company – the soul of SAP, it there is such a thing. He is not a product-pusher, not a marketer: he sets direction for several years ahead.

SAP has an existing (legacy) market to protect, and they clearly don’t want the On-Demand product to cannibalize that market. But Plattner knows On-Demand is coming, and I bet the SMB space will be the test-bed to the new system eventually “growing up” to all of SAP’s market segments. Hasso Plattner gets the On-Demand religion, and when he gets a new religion, SAP typically follows. Plattner oversaw two major paradigm changes: the move from mainframe to client/server, which was entirely his baby, and the move to SOA/Netweaver, where he embraced Shai Agassi’s initiatives. The ‘New Idea” will likely be the last time Plattner turns the Mothership around. Next he will need to find “another Shai” to make sure there is a strong tech DNA in SAP’s leadership, as the Sales/Marketing types take over at the helm.

Filed Under: Bay Area, Business, Enterprise Software, ERP / CRM, SaaS, SMB / SME, Social Networking, Software, Technology · Tagged: A1S, Enterprise Software, erp, Hasso Plattner, keynote, On-Demand, Plattner, SaaS, sap, SAPPHIRE07, smb, sme, Software2007

Freshbooks Launches Benchmarking Service: SaaS Will Never Be the Same

Posted on April 16, 2007 ·

Way back at the Office 2.0 conference FreshBooks CEO Mike McDerment dropped a bomb in the last 20 seconds in his presentation: being software as as service, they can aggregate customers’ data, categorize it by industry, size ..etc, and once they do that, why not turn it into a service, providing customers with their own performance metrics as well as benchmarking them against their peers.

A few months later, the Small Business Report Card service will launch tomorrow at the Web 2.0 Expo as well as online. The service will be free to all Freshbooks customers, who will:

all receive their own performance metrics, and
if they select their peer group based on (currently) 80 types of business / professions, geography and several other business criteria, they will also receive their relative position, “score-card” within that group.

The sample below is a mock-up of the actual Report Card, but is shows the initial metrics reported. Clearly, as they further enhance the program, there will be more and more criteria, and FreshBooks customers will have a say in what performance metrics they find valuable.

Remember, FreshBooks’ customers are mostly small businesses who don’t have an army of MBA-types crunch the numbers and look for business (in)efficiencies. In fact it’s probably fair to say some would not even know how to interpret the numbers, until they are put in prospective – hence the value of relative benchmarking.

But why will SaaS never be the same? This isn’t just about FreshBooks and its customers.

It’s *the* hidden business model enabled by SaaS. An opportunity not talked about, but so obvious it has to be on the back of all SaaS CEO’s mind. Benchmarking is a huge business, practiced by research firms like Forrester, Hoovers, Dunn and Bradstreet, as well as by specialized shops like the Hackett group – none of which are affordable to small businesses. More importantly, all previous benchmarking efforts were hampered by the quality of source data, which, with systems behind firewalls was at least questionable. SaaS providers will have access to the most authentic data ever, aggregation if which leads to the most reliable industry metrics and benchmarking.

Being pioneers always carries a risk, and clearly, Freshbooks will have to keep an eye on their customers feedback. There may be a backlash due to data privacy/ownership concerns; some customers will not opt in, they may even lose some customers entirely. But I believe the majority will see the light and benefit from the service. If Mike’s blog post on the subject is any indication, the feedback there was overwhelmingly positive, with 13 comments for, 3 against.

I suspect a year or two from now benchmarking based on aggregate customer data will be standard industry practice, and little (?) FreshBooks will be looked upon as the pioneers who opened up the floodgate of opportunities.

Last, but not least a word on the creative launch – or a lesson on how to launch from a conference you don’t officially participate at:

Yugma is a web-conferencing company and an exhibitor at Web 2.0 Expo. What better way to demo a web-conferencing product than by showing real-live use… without Yugma having to move a finger to create content. They created Stage 2, a platform for companies to showcase their products remotely at the Yugma booth and simultaneously to the World through a Net broadcast. Both the presenters and Yugma win – congrat’s, and my personal Creativity Award to Yugma

Update (4/19): read Jeff Nolan’s comments.

Update (10/8/2008): Congrat’s to Freshbooks for getting on Fox Business.

Filed Under: Business, Collaboration, Personal Productivity, SaaS, SMB / SME, Software, Startups, Technology · Tagged: accounting, benchmarking, data aggregation, freshbooks, invoicing, On-Demand, performance metrics, productivity, report card, SaaS, score-card, small Business, smb, sme, video conferencing, web2expo, web2expo07, yugma

Koral Acquired by Salesforce.com

Posted on April 9, 2007 ·

Wow, this was fast. I met Koral CEO Mark Suster some time in November, when he gave me a demo of his then pre-beta Content Collaboration system. I instantly liked it, largely for it’s simplicity – hence the title of my review: Koral – Collaborative Content Management without the Hassle of “Management”.

Apparently I was not the only one who liked the product. Koral is no more. Salesforce.com has acquired it, launching its new service … hm, SalesforceContent, or Apex Content, or Salesforce ContentExchange – apparently there is a bit confusion over the name, but we’ll know it tomorrow for sure. The logo is from the (former) Koral site:

Update: Clarification from CEO Mark Suster:

“The overall initiative is called Salesforce Content. That consists of the Apex Content platform where developers will be able to build their own content based applications and Salesforce ContentExchange, which is a Web 2.0 application for managing corporate content that sits on top of this platform.
Basically, we took an integrated product, Koral, and split it out into a platform piece for developers and an application piece ready to sell to customers.”

TechCrunch, Read/WriteWeb and ZDNet has all the details. Congratulations, Mark, Tim and the rest of the team!

Filed Under: Business, Collaboration, Personal Productivity, SaaS, Startups, Technology · Tagged: Collaboration, content collaboration, content discovery, content management, document management, ecm, koral, SaaS, salesforce.com, search

Radar Relay – What’s Happening in Office 2.0

Posted on March 7, 2007 ·

I might as well have titled this post Radar Delay – first it was due last Friday, as part of series of reviews leading up to the Under the Radar: Office 2.0 event, but then fellow Enterprise Irregular Rod Boothby posted an “extra” article the same day, so I decided to wait till Tuesday. Yes that was yesterday, the day when Comcast, my ISP ironically responded to my push for On-Demand with a service outage.

But first things first: Web-based products received a surprise promotion from an unexpected source: Microsoft. As Phil Wainewright says on ZDNet:

“It’s astonishing that in the midst of a serious challenge from a new generation of Web-native office suites, Microsoft should give its rivals a helping hand by handicapping its own product so badly that it performs worse than an online product on a slow dial-up line.”

He is referring to the Outlook 2007 meltdown several users experienced:

“You’d think I had just sprayed the inside of my poor mega-laptop with saltwater to induce non-stop fritzing. I’ve learned to meditate while Outlook ruminates over ten incoming POP messages of 69K. Perhaps it takes a few seconds over each incoming message or RSS feed to contribute to solving a Grand Challenge. Or it and Desktop Search have to play 333 iterations of rock-paper-scissors everytime a change has to be written“

You can hardly accuse the above user with anti-Microsoft bias, since he is none other than Mini-Microsoft, who is obsessed with fixing Microsoft, the company. The Guardian, Dennis Howlett, Jason Busch, Tim Anderson, Chris Pirillo, Dan Farber, Phil Wainewright had similar experiences. Phil asks:

“But is it an even better fix to abandon Outlook and Exchange altogether and switch to an on-demand alternative?

My answer is a loud YES, and I’m making my point in Desktop Software: A Failed Model. Of course glitches occur in the On-Demand world, too, as we just witnessed Google Apps collapse soon after the announcement. We’re not quite there yet, but I share Rod Boothby’s view that we have passed a tipping point: while 2 years ago the ideal mix would have been desktop computing with additional online access, now I feel as a user I am better off mostly working online, with occasional offline access.

A somewhat doubtful friend, who happens to be the CEO of a cool company making web-based products sent this question:

“Do you really think people will use Word processors (in any significant number) through their web browser? “

Yes, I really do think, but why believe me? Listen to a US Government Agency instead: FAA May Ditch Microsoft’s Windows Vista And Office For Google And Linux Combo.

Some of the Under the Radar “Graduate Circle” sponsors posted significant news recently:

Atlassian announced a WebDav plugin which allows users to seamlessly work with both MS Office documents and the Confluence, their market leading enterprise wiki. They also released a hosted version of Confluence – this is something I’ve been waiting for impatiently. This was followed by the announcement of Crowd, their single sign-on authentication software.
Zoho announced integrating Zoho Sheet to Omnidrive, updates to Zoho Projects and overall performance improvements. Web Host Industry Review reported that Zoho doubled customer count in 5 months, going from 100K to 200K.
EchoSign, an innovative solution provider that can proudly wear the SES badge, if we ever get tired of SaaS, has just announced their integration with Zoho Writer .
FreshBooks anounced integration to BaseCamp for easy invoicing. This “Graduate Circle” sponsor could also wear the SES label:-) It’s really promising to see more and more integration within the Office 2.0 ecosystem.

Talk about user base, Nielsen/NetRatings issued a press release claiming that Google Docs and Spreadsheets dominate web-based productivity tools since October, with a market share of 92 percent of unique visitors. Ismael Ghalimi did some research and proved them wrong concluding that Google’s market share may be closer to 50%. His take:

“It is actually quite amazing that companies like ThinkFree and Zoho, with their ridiculously small marketing budgets, can play in the same league as mighty Google.”

Ismael is the creator of last years successful Office 2.0 Conference, and he is already preparing for Office 2.0 2007. But that’s in September – first we’ll have an exciting full-day conference:

Under the Radar: Why Office 2.0 Matters on March 23rd, in Mountain View, CA. Here’s the updated agenda and a list of presenting companies:

The Conference is put up by DealMaker Media, which was until recently known as IBDNetwork. (Too bad I missed their Launch Party.)

Hope to see you there!

Update (3/09): Passing the baton to Stowe Boyd, here’s his Relay post.

Filed Under: Bay Area, Blogging, Business, Collaboration, Marketing / PR, SaaS, Social Networking, Software, Startups, Technology · Tagged: atlassian, confluence, DealMakerMedia, EchoSign, freshbooks, google apps, IBDNetwork, ITRedux, microsoft, Office20con, offiice 2.0, Omnidrive, On-Demand, Outlook, Radar Relay, SaaS, Under the Radar, vista, weboffice, zoho

SAP’s Zesty A1S(auce)

Posted on January 26, 2007 ·

SAP held major internal announcements and demos of its A1S product, tailored for the mid-market, the future growth sector now that the top end of the ERP market is saturated.

The demos were top-secret, attendees had to sign an NDA – and since I am not one of them, I’m left wondering whether they’ve seen the original flavor or the Zesty one

Filed Under: Enterprise Software, ERP / CRM, Humor · Tagged: A1S, Enterprise Software, erp, Humor, mid-market, On-Demand, SaaS, sap, sap a1s

24SevenOffice Acquisition Rumors

Posted on January 19, 2007 ·

24SevenOffice, the European SaaS provider of an integrated, All-In-One system for small businesses may be in acquisition talks with a major US vendor. The news went almost unnoticed, partly because it leaked just before Christmas, partly because the company is largely unknown outside a few European countries – not for long if a deal comes through.

I covered 24SevenOffice, a very promising SaaS provider for the SMB (SME) market several times. Their system is modular but integrated with a breath of functionality I simply haven’t seen elsewhere: Accounting, CRM (Contacts, Lead Mgt, SFA), ERP (Supply Chain, Orders, Products, Inventory), Communication, Group Scheduling, HR, Project Management, Publishing, Intranet. Essentially a NetSuite+Communication and Collaboration.

About the only thing I did not like was the lack of availability for US customers – this might change soon. The news release and blog post mentions three names: Salesforce.com, WebEx and Google, but adds a somewhat cloudy remark: “the companies here are only examples of what the rumors have outlined.” It does not explicitly confirm one of these specific companies as the potential buyer. I should also add that while I had in the past been in touch with Management, at this time I have no information whatsoever from the company, so the ideas below are purely my speculation.

Salesforce.com as suitor: A well-integrated All-In-One product would come handy to Salesforce.com which could dramatically expand their customer base this way. However, they’ve gone a long way in the other direction, trying to become a platform and extending their reach via the ecosystem built around the AppExchange. Acquiring 24SevenOffice would be a huge about-face for Marc Benioff, and essentially would mean admitting that archrival Zach Nelson of NetSuite was right all this time about the superiority of the integrated All-In-One approach.

WebEx: Their original market, the web conferencing space is being commoditized, they clearly are looking for more lucrative markets, as evidenced by the recently launched WebEx Connect (their “AppExchange”). I haven’t heard about much activity since the announcement – certainly owning a product like 24SevenOffice (btw., it really should be called 24SevenBusiness) would allow WebEx a powerful entry into the SMB applications market.

Google: No way, you might say. Google and business process / transaction oriented software are lightyears apart – at least today.

Yet unlikely as it sounds the deal would make perfect sense. Google clearly aspires to be a significant player in the enterprise space, and the SMB market is a good stepping stone, in fact more than that, a lucrative market in itself. Bits and pieces in Google’s growing arsenal: Apps for Your Domain, JotSpot, Docs and Sheets …recently there was some speculation that Google might jump into another acquisition (Thinkfree? Zoho?) to be able to offer a more tightly integrated Office. Well, why stop at “Office”, why not go for a complete business solution, offering both the business/transactional system as well as an online office, complemented by a wiki? Such an offering combined with Google’s robust infrastructure could very well be the killer package for the SMB space catapulting Google to the position of dominant small business system provider. Who’d benefit from such a deal? Google, millions of small businesses, and of course 24SevenOffice.

I admit I would feel somewhat sorry for 24SevenOfice though, as I clearly think they could have a shot of becoming a billion-dollar business on their own – the next NetSuite. Either way, if they make it to the US market this year, they’ll likely see explosive growth. When they are a well -known brand, remember, you discovered them here.

Filed Under: ERP / CRM, SaaS, SMB / SME · Tagged: 24sevenoffice, all-in-one, crm, Enterprise Software, erp, Google, netsuite, office 2.0, On-Demand, SaaS, salesforce.com, small Business, smb, sme, thinkfree, webex, zoho

The "Hidden" Business Model in SaaS: Benchmarking

Posted on December 14, 2006 ·

(Updated)

While we saw a lot of exciting products at the Office 2.0 Conference, the biggest “surprise” was not a product announcement, but FreshBooks CEO Mike McDerment letting the cat out of the bag:

“He basically announced the hidden value proposition enabled by SaaS: competitive benchmarking. All previous benchmarking efforts were hampered by the quality of source data, which, with all systems behind firewalls was at least questionable. SaaS providers will have access to the most authentic data ever, aggregation if which leads to the most reliable industry metrics and benchmarking. “

Two months later FreshBooks published the first set of raw data. It includes stats on payment methods, invoicing by email vs. regular mail, browser an operating system usage. It’s a rather limited set, and only covers two months, but it’s a start, certainly to be followed with more business-critical data. CEO Mike McDerment also takes a first cut at analyzing the data, for example:

“Browser Usage

– Internet Explorer 7 – October 5.02%, November 9.68%

– IE 6 – October 37.64%, November 36.77%

– Firefox 2.0 – October 6.61%, November 24.51%

– Firefox 1.5 – October 44.26%, November 22.07%

Analysis

Both IE and Firefox have new versions out. Clearly the Firefox community is quicker to switch to new versions. Remarkably quick in fact.”

I’m not sure I’d agree with the analysis: certainly Mike is right, the Firefox community appears to be quicker in switching to new versions, but aren’t we missing a bigger picture? I’ve dropped the data into Zoho Sheet, the web-base spreadsheet app which generated this chart:

The “bigger picture” is that IE gained market share vs. Firefox (something that as a FFox user I’m not happy with ). Clearly, the majority of new IE7 users are not IE6 upgraders, they came from the Firefox camp.

But I’m not here to discuss browser use, nor do I intend to ridicule Mike’s analysis. I picked this example to make a point: the same data set may carry different meaning to you and me. The art isn’t so much in the accumulation of data, but the proper aggregation and analysis allowing customers to benchmark themselves against industry peers – that’s where the real value is, not in raw data. So much so, that I probably wouldn’t entirely give it away; rather market it as a for-fee premium service.

SaaS providers may become the benchmark specialists themselves, but think about it: businesses will likely end up using a few systems from different providers, and if your purchasing, sales, invoicing, service ..etc data are all in different systems (and consequently aggregated by the different providers), wouldn’t you have a better competitive picture benchmarking yourself based on all those aspects? Does this mean we’ll have independent benchmarking consultants in the SaaS world? If so, will there be a secondary market for raw aggregate data?

But wait … whose data is it anyway? Trust in your data being secure, not lost, published, traded with is the cornerstone of the SaaS model’s viability. But we’re not talking about original customer data, rather its derivative – does that change the picture? There’s a potentially huge market opportunity here, yet SaaS veterans like Salesforce.com, NetSuite, RightNow …etc haven’t explored it yet. Why? I suspect for this very trust/ownership issue, which can be a potential mine-field. In the early days of SaaS it simply would not have been appropriate to address it, but now with mainstream SaaS acceptance (MicKinsey predicts 61% of $1B+ corporations will adopt one or more SaaS applications over the next year) it’s high time the industry starts addressing these issues.

Kudos to FreshBooks for being a pioneer in building the service as well as bringing a major industry dilemma to the forefront.

Update (01/04): Jeremiah is thinking along the same lines, discussing how storage companies will (?) eventually pay for your data. Yes, he talks about storage while I talk about applications, he talks about advertising while I talk about benchmarking, but in the end it’s the same: user data being processed to deliever business services.

Update (9/28/2008): Here’s another showcase of benchmarking turned into action messages on CloudAve.

Filed Under: Business, Enterprise Software, ERP / CRM, SaaS, SMB / SME, Software, Technology · Tagged: accounting, benchmarking, crm, data aggregation, data mining, data security, Enterprise Software, erp, freshbooks, netsuite, Office20con, On-Demand, RightNow, SaaS, salesforce.com, small Business, smb, sme, zoho

Betting on the NetSuite IPO

Posted on December 6, 2006 ·

(Updated)

Phil Wainewright at ZDNet is running a poll on whether NetSuite will have a chance to go ahead with the long-awaited IPO or it will get folded back into the Empire.

I’m somewhat surprised by the above results, but since this is an early snapshot, please check the live poll for the current vote count.

Surprise or not, acquisition by Oracle is a realistic scenario, considering Larry Ellison’s close to 60% stake in NetSuite. This is certainly fellow Enterprise Irregular Jason Wood’s take.

I tend to believe that NetSuite is better off being an independent business; there are just too many differences for a merger to work well, and I don’t mean only technical, product-related differences. NetSuite is still largely a small business (SMB) player, and that’s a market that requires an entirely different Sales and Marketing approach, amongst others, and Oracle with it’s current “legacy” salesforce just can’t reach this market profitably. If your products are different, your target market is different, your organization, corporate culture are different, where’s the synergy? Big behemoth Oracle would kill NetSuite – Larry is better off with a portfolio approach, cashing in a 10-digit return

Talk about the SMB market – there really is no such thing. “SMB” was sufficient to describe the market to avoid, but now that the software industry is getting ready to actually address the needs of this segment, it’s too heterogeneous to be lumped together.A $100M business is just as different from a ten-person startup as it is from a Fortune 1000 company. When analysts talk about SMB, they really have the mid-market in mind; when SAP is announcing new SMB initiatives, it targets $100-$200M companies.

The forgotten “long tail” represents a huge untapped opportunity: millions of (very) small businesses that can now directly be reached, sold to, serviced inexpensively over the Net – classic SaaS style. Different markets require different organizations – NetSuite serves this segment much better than Oracle (or SAP, for that matter) ever could. In fact SAP would be wise to copy this chapter from Ellison’s book: it should get it’s own “NetSuite” by investing in (not acquiring) an up-and-coming small-business focused All-in-One SaaS provider, like European 24SevenOffice. The next NetSuite.

Update (12/11): NetSuite Gets Ready For Its Close-Up by BusinessWeek.
Update (12/19): TechCrunch is running a story titled NetSuite’s Going Public, Looking for $1 Billion Valuation. I don’t know if it’s based on new information or …. (?)

Filed Under: Business, Enterprise Software, ERP / CRM, SaaS, SMB / SME, Software, Technology · Tagged: 24sevenoffice, acquisitions, all-in-one, crm, erp, ipo, ipo market, irregulars, m&a, mergers, netsuite, On-Demand, oracle, SaaS, sap, smb, sme, vsb

24SevenOffice is More than Just Office – Watch Demo

Posted on November 7, 2006 ·

24SevenOffice is an innovative software company offering SaaS for the SMB / SME market that should really be called 24SevenBusiness

Their system is modular but integrated with a breath of functionality I simply haven’t seen elsewhere: Accounting, CRM (Contacts, Lead Mgt, SFA), ERP (Supply Chain, Orders, Products, Inventory), Communication, Group Scheduling, HR, Project Management, Publishing, Intranet. Essentially a NetSuite+Communication and Collaboration.

They are innovators in many ways … had an AJAX system long before it was called AJAX and recently they created a “World’s First” by teaming up with a bank that becomes the SaaS provider offering its customers single sign-on Web solutions for banking and all other business software needs.

The system is really comprehensive so it may not be that easy to figure out all features, therefore they released a cool flash demo that walks through the major business processes. (hat tip: Espen Antonsen)

What I really like about 24SevenOffice is that they are proof to my favorite theme, i.e. that small businesses can now have “enterprise” system functionality. My only complaint is that so far they onu cover several European countries; I wish they were faster entering the US market. But I’m hearing that may not be too far now …

Update (11/12): check out Dennis Howlett’s post on Interprise Suite, another integrated system for the SMB market.

Filed Under: Business, Collaboration, Enterprise Software, ERP / CRM, SaaS, SMB / SME, Software, Technology · Tagged: 24sevenoffice, accounting, crm, erp, hosted+software, Mobile+Office, netsuite, On-Demand, On-demand+CRM, on-demand+ERP, SaaS, SaaS+CRM, SaaS+ERP

Losers of the Google / JotSpot Deal

Posted on November 2, 2006 ·

(Updated)
In my longer analysis of the JotSpot sale to Google I listed a group of JotSpot customers who may feel disadvantaged by the deal: those who’d rather pay to have their data at a company whose pure business model is charging for services than enjoy free service by Google whose primary business model requires dissecting/analyzing their data left and right.

I also pointed out that several competitors are offering deals to migrate these customers to their platform free or at a discount. Socialtext and Atlassian were the first to come forward with their offers, but since the previous post I heard about Central Desktop, (update: see correction in this comment by Central Desktop’s CEO), ProjectForum and I’m sure there are others. (Clearly, the wiki market is growing and sadly, I don’t know all the players). Jerry Bowles and Tom Raftery wrote more on the subject.

We all seem to have missed a point here: there is a group of customers for whom migration is not optional but a necessity: participants in the JotSpot Wiki Server beta program. Like I’ve said before, as much as I am a SaaS believer, it is not a religion, apparently the feedback from most customers is that they want their wiki behind the firewall – JotSpot’s response was the Wiki Server edition. These customers now have a rude awakening: JotSpot notified them that they would discontinue the beta program. Current customers have the right to continue using the product for the remainder of the 90-day beta period (what’s the point? ) but there is no support, no migration plan – game over, bad luck. Of course JotSpot had the right to do this, these were not paying customers (yet), and a beta is a beta, after all. But a beta program is a mutual effort, and especially early on requires a lot of time and effort from the customers, so it’s clear that these customers may feel let down. While most competitive migration offers are hosted solutions, it’s this specific “betrayed” group that Atlassian goes after: they offer migration help and discounted rates on Confluence, their behind-the-firewall enterprise wiki. So let down or not, these customers may eventually be better off on a more mature, robust enterprise platform.

As a sidenote, this is the second time that JotSpot drops a product benefiting a competitor: when they discontinued JotBox, Socialtext reaped the benefits by moving those customers to their Appliance. Update: Please read the comment exchange below for correction by JotSpot.

Update (11/29): two post on how the deal affected JotSpot partners and customers:
JotSpot Got the Goldmine. Its Partners and Customers Got the Shaft.
The JotSpot Google Merger

Update (11/30) the above post, The JotSpot Google Merger is now deleted, supposedly under pressure by … (?) Read the story on TechCrunch.

Filed Under: Business, Collaboration, Customer Service, Enterprise Software, SaaS, Software, Startups, Technology · Tagged: atlassian, confluence, Enterprise Software, enterprise wiki, Google, Jotspot, jotspot wiki server, SaaS, socialtext, wiki