Thursday, August 7, 2008

Hey SaaS where's my backup generator

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Backup generators is one thing that surely comes to mind going through the latest round of SaaS and SaaS platform related access problems this time with Google Apps.

Google Apps Hit by Prolonged Gmail Access Problem
Amazon Down For An Hour And Counting (Updated)
Amazon Web Services Goes Down, Takes Many Startup Sites With It
Downed Salesforce systems slow Europe and US

With all the talk these days about cloud computing and how everything needs to be moved into the sky (err sorry cloud) I wonder where it would leave enterprises with large scale outages. Maybe that's where the hybrid - fail over model of SaaS with OnPremise replication plays a strategic role. Now one can argue that the cost might be prohibitive for smaller organizations and it would involve a number of factors like criticality of application * duration of outage * impact to business etc.

The most common real world analogy that I've seen repeated over and over again from SaaS offerrings is about the utility model and how everyone today gets their power from a single vendor who works on all the infrastructure, operations and issues. While we the consumer provide a per unit usage fee and forget about the rest. Would you run something critical like a general hospital by solely relying on the power grid? Why hospitals, these days it comes down to very small retail organizations as well who have their own battery or diesel powered backup devices to withstand outages and keep business running.

Well here are some of my observations around the power grid and SaaS analogy and maybe its a black box of opportunities for a number of vendors who might not currently be in the SaaS platform provider race.

- If we look at the maturity curve of the power industry, SaaS is a long way from it.
- While there might be one front face vendor for an area ( like a PG&E) there are a number of up and down stream vendors who make the entire delivery happen.
- There will be a lot of mergers and consolidations in the SaaS space if the power industry is any indicator.
- The likelihood of a large number of ancillary offerings coming up around the space that offer backup products and backup strategies is high. Its akin to the diesel generator industry.
- As consolidation will occur and single vendors per geo's or verticals will appear it will spawn a whole an entire industry segment of vendors manufacturing devices that feed from the power lines like the electric devices of today.

Though its a little unclear who will be the electric company vs the backup generators vs the device manufacturers (the Westinghouses, GE's of todays world). One thing is certain that if SaaS/SaaS Platform is to be successful in large enterprises there will have to be backup generators ... most likely onsite near to the delivery end point ... it will have to keep storing information or juice enough to make it a swift and viable backup in case of large scale disruptions or outages.

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