3
Apr

Establishing a Reliable Notion About Enterprise Adoption of Cloud SaaS Offers

There are at least two useful perspectives anyone with an interest in the cloud computing trend ought to sample. The first of these is to develop a clear understanding of consumer appetite for these services. But the second, with equal importance, must include a correct understanding of why and how providers also benefit from the trend.

I think it’s safe to say the public is comfortable with the first of these perspectives. As well, a lot of the analyst community spends quite a bit of their time writing about, and discussing the explosive appetite cloud consumers have for these services.

But, I argue, a matching amount of time is not being spent exploring why mature ISVs have a comparable appetite for the same method of delivering software to customers. Back in 2012, in a post to this blog titled Cloud Computing and Software as a Service are Examples of Computing Products that Conform to Razorblade Product Design, and, in a few other posts I wrote around the same time, I presented my notion of why ISVs opting to deliver product via SaaS cloud offers stand to benefit, substantially. A component of this interest, on the part of ISVs, of course, will be to heavily promote cloud computing trends. Unfortunately, this promotion may create a false sense of the velocity of consumer appetite. So it is imperative for anyone following the trend to keep both points of view in perspective.

What’s prompting me to pick up on this point, now, is a disconnect I perceive between IBM and Microsoft with regard to the actual velocity of consumer transition to cloud computing SaaS offers. As I wrote earlier this month, in her presentation at Mobile World Congress, 2014, Ginni Rommetty, CEO of IBM®, referred to analyst estimates about speed at which enterprise computing applications are migrating to the cloud. Ms. Rommetty, as I wrote, mentioned a likely scenario where 15% of enterprise applications would be served via cloud, SaaS methods by sometime in 2016. Of course, 85% of enterprise computing applications will still be served on premise, if this projection is correct.

Turn to a presentation by Dr. Qi Lu, EVP, Applications and Services, for Microsoft® at Morgan Stanley’s T&T Conference, held during the first week of March, 2014. Dr. Lu notes: “One is computing moving to the cloud, and this is a once in several decade paradigm shift from mainframe to client server, client server to the cloud. That’s a massive change, creating a lot of opportunities for different types of products, and business objects. That’s number one.”

I strongly recommend anyone interested in this topic carefully investigate Dr. Lu’s and Ms. Rommetty’s claims before reaching a conclusion. The question is a complex one. It makes sense to maintain a skeptical stance when presented with simple answers to the question. I can provide additional recent pointers on this topic upon request.

Disclaimer: I’m long Microsoft, but have no position in IBM

Ira Michael Blonder

© IMB Enterprises, Inc. & Ira Michael Blonder, 2014 All Rights Reserved