SaaS on the march

On-demand vendors are starting to make a stronger push in the regional market. ACN speaks to two of the leading players.

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By  Imthishan Giado Published  June 21, 2008

On-demand vendors are starting to make a stronger push in the regional market. ACN speaks to two of the leading players.

With the advent of software-as-a-service (SAAS) in the region, enterprise CIOs have one more buzzword to contend with and another set of vendors promising that their product will cure all ills.

Of the latter, Salesforce.com is probably one of the most well-known names in the on-demand market, and is now planning to make inroads into the Middle East market through its recent partnership with integrator eSolutions.

Though on-demand products may be new to the region, the global market for these types of systems is exploding, with Salesforce estimating Western Europe's share of the market alone to be worth US$473 million by 2011.

Cloud computing has been adopted initially in the SMB and mid-market because they just tend to make decisions more quickly as smaller, more nimble organisations

Piero Falloti, Salesforce's vice president for eastern and central EMEA, explains how he plans to bring customers into the fold.

"Often what we see is that a company already has some system. We go and talk to a sales manager in the department who wants something for the sales people and doesn't want to wait a year or two or three for the big application to be implemented everywhere.

They ask to try Salesforce and get ten to 15 salespeople running on it - we can make sure they are running in a few days," he says.

Falloti also intends to use his customers in an evangelical fashion - a situation in which he has some measure of experience.

"I used to be a Salesforce customer before I joined - and I've never seen this in any other company, where every customer is ecstatic about the product and tells their friends and colleagues.

I know people who have used Salesforce in one company, changed jobs and convinced their new employer to use it because they liked it so much.

Our business model is a happy customer, which is very different from traditional software where you have to sell something and then the customers are stuck with it for years, for good or bad.

While Falloti works to build his Salesforce user base through word-of-mouth and promoting ease of implementation, Jesper Frederickson, head of Google's enterprise activities in the Middle East, explains what he believes are the core drivers for SAAS in the region.

"The cost benefit of abandoning your infrastructure and moving into a massively shared service is basically so compelling that we're now at an inflexion point where most enterprises will automatically consider SAAS as an alternative to their CRM, ERP systems, collaboration tools, e-mail system and so on, simply because the connectivity is now there.

The functionality in many cases, like in Salesforce and Google Apps, is also now at a point where they match the on-premises solutions. Those are the reasons - cost savings, connectivity, and finally the functionality in the solution," he says.

According to Frederickson, the Middle East may even have significant advantages compared to other markets: "One key thing we are experiencing is that some of the Middle Eastern and African markets may almost have skipped a generation.

They may not have invested in the latest version of the solution so that basically gives you and your market an opportunity to jump onto this platform more quickly than someone in the Western European or North American markets where you may have put a lot of effort and money into the latest version of Exchange.

Where in the world is my server?

One of the fundamental policies at Google is that for security reasons, we don't comment where we have our datacentres.

We try to spread our capacity out across the globe from a redundancy perspective and obviously to minimise latency and improve user experience.

If people don't know where our datacentres are, that's the first level of security - so we prefer to not reveal that level of information," says Google's Frederickson.

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