Interop Mumbai 2009

Cloud Computing and SaaS

Market Evolution and Implications

Balaka Baruah Aggarwal

Senior Manager, Software Research

Springboard Research

Cost Savings

• IT budget cuts are a reality in the current climate

• Capital expenditures are closely scrutinized

• Subscription-based pricing is highly compelling

Process Improvements and Increased Efficiencies

• Shift from enabling growth to increasing or at least maintaining margins

• Successful companies are still investing

Short-term Value Delivery

• ROI must come in weeks or months – not years

• Project value must be clearly defined, targeted, agreed-upon and measurable

CIO CHALLENGES – 2009

2

3

SAAS VERSUS CLOUD COMPUTING –

SETTING THE STAGE

Services Vary

• Software as a Service (SaaS)

• Platform as a Service (PaaS)

• Infrastructure as a Service (IaaS)

Certain Characteristics are required

• Web-based user access

• Multi-tenancy and shareable resources

• Massive scalability and dynamic resource allocation

A collection of IT-enabled resources and capabilities that

can be delivered via the internet as a service

4

SaaS growth is 3-4x on-premise SW growth

“The Cloud” provides additional boost to the SaaS model

CRM & Collaboration lead, but SaaS apps are blossoming

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

$0

$500

$1,000

$1,500

$2,000

$2,500

2008 2009 2010 2011 2012

IT Market Size SaaS Growth SW Growth

SAAS MARKET GROWTH

REMAINS STRONG

5

SLOWDOWN TRIGGERS SAAS

INTERESTQ: Has the economic slowdown increased your interest in SaaS? N: 487 APAC/121 India

Source: Springboard Research, 06/2009

Yes, 30%

Yes, 33%

Yes, 42%

0% 10% 20% 30% 40% 50%

India

APAC

ANZ

6

SAAS USAGE IN INDIA

Q: What SaaS application are you currently using? N: 73 SaaS adopters*

Source: Springboard Research, 06/2009; *Numbers do not add up to 100 as respondents mentioned multiple SaaS applications

3%

15%

18%

19%

23%

33%

0% 10% 20% 30% 40%

Email

Web Conf./IM/Collab.

HR/Payroll/WFM

Other

CRM

ERP

7

SAAS DRIVERS IN INDIAQ:What was the primary reason for adopting SaaS? N: 73 (SaaS adopters)

Source: Springboard Research, 06/2009

3%

4%

7%

8%

10%

11%

22%

35%

0% 10% 20% 30% 40%

Corporate decision

Zero/Low maintenance

Other

Accessibility

Scalability

Addresses a specific biz need

Convenience

Lower cost of ownership

Business is interested in processes and information

• Not technology, applications or infrastructure

IT is a means to an end, not an end in itself

• The ‘service’ being consumed is ultimately all that matters

• Everything else is simply part of the plumbing

From a business standpoint, IT has no inherent value at all

• All value lies in how effectively IT is applied to help meet business objectives

Focus on the forest….

….not the trees!!!

WHY CLOUD COMPUTING….

8

Virtualization

• Driving data centre improvements – lower costs, improved service

• Focusing attention on ‘economies of scale’ –the value of shared resources

Open Standards

• Rich Internet Applications and Web 2.0 standards – enhanced usability

• Improved interoperability and applications as a collection of ‘services’

Internet

• Available, reliable, and affordable broadband

…. WHY NOW???

9

Integration• Local/Remote Integration

scenarios

• Cloud to Cloud issues

• Dynamic resources

Data Governance• Integrity, Recovery, Privacy,

Segregation

• Sovereignty Laws and Regulations

Management• Performance management and

monitoring

• Ensuring Service Level Agreements (SLAs)

Security• Regulatory compliance

• Unauthorized access

CHALLENGES TO OVERCOME

10

11

In Summary….In Summary….

Prepare for the Economic Recovery Now

• If you don’t, your competitors will

Turn Challenges into Opportunities

• Resource constraints can drive better behaviour

• Budget and staffing limitations will remain

Ignore the Hype

• There are STILL no silver bullets

• Business priorities drive IT decisions

Educate Yourselves

• SaaS and Cloud Computing are not new

• This is a good thing!

Thank You

baggarwal@springboardresearch.com