Fujitsu just presented SaaSification on Cebit. Existing applications can be easily brought to the Cloud and sold via App Stores and SaaS marketplaces. IBM is also working on SaaSification and even adds multi-tenancy.
What is next?
Everybody wants to have a full App Store or SaaS Marketplace, so SaaSification is the next step after launching your store. However converting a client/server application to the Cloud is only step 1. Step 2 is creating new services that are specifically built for the Cloud.
What does Built-for-the-Cloud means?
Cloud-Ready applications should also accept the new reality of APIs. Both for exposure as well as consumption. This means that applications need to be redesigned according to application slices.
So if SaaSification wants to be successful then it needs to add quick enablers for multi-tenancy, big data, integration with external APIs as well as API exposure, etc. This integration concept can be called iPaaS or integration platform-as-a-Service. iPaaS should not only focus on exposing or integrating APIs but on providing complex services by integration multiple SaaS solutions together.
Other enablers should be added as well. Basically 80% of a SaaS solution consists out of the same elements or tries to solve the same problems. These could all be provided via a SaaSification PaaS:
- Blog – to describe the newest ideas.
- Forum – for people to get answers from the community.
- IT PaaS – where you run the actual business logic and UI. Data storage is assumed to be provided by the Big Data elements.
- Portal and Mobile Portal – allows to quickly define the “static” content for the web and mobile site.
- Deployment management – ideally continuous deployment or integration tools that allow fast feature by feature deployment.
- A/B testing – allow new features to be deployed to subsets of users and check which version of a feature has the highest impact on the bottom-line. A/B testing was made popular by Amazon.
- Automated testing – lots of testing can be automated but especially end-to-end and performance testing are the harder tests that should be focused on.
- Configuration management – manage the version control of the code.
- Metering and billing – be able to meter the resource usage by users, companies or any other element you want to meter and be able to bill users both for subscriptions as well as for usage, ideally with advanced set-up with overage, etc.
- Marketplace listing and provisioning – automate the listing of products on the marketplace as well as the provisioning of new services.
- Single sign-on & identity management - allow companies to use their own user credentials (e.g. SAML), authorization for third-parties (e.g. oAuth), etc.
- Reporting and data warehousing – this can be part of the big data stack but especially being able to create ad-hoc reports for instance for A/B testing . Of course regular business reporting needs to be included as well.
- ERP – accounting, resource management, etc.
- CRM – sales and lead management
- Operations & Maintenance – automation of back-ups, monitoring both for the performance and fault management but as well business monitoring.
- Support – helpdesk, ticketing system, SLA management, etc.
- Social integration – tools to add social aspects like Facebook apps, Twitter feeds, etc.
The idea is not that a SaaSification PaaS offers all these solutions by custom development. Instead the SaaSification PaaS should allow startups to assemble an ideal architecture by combining different solutions from different providers. For example you would be able to select the support solution you prefer, e.g. desk.com, zendesk.com, etc. and this solution would be completely integrated into the overall stack, e.g. CRM integration with help desk and fault management together with sign sign-on.
SaaSification 2.0 should focus on making sure that 2-5 people can start a new dotcom solution and focus on creating a killer service and not on building up yet another stack of solutions for configuration management, support, billing, etc. If a SaaSification PaaS can shorten the time to launch with months and reduce the needs to operate the solution with several people then startups will see the value. Instead of SaaSification PaaS a good term could be Incubation PaaS, to incubate SaaS solutions. Once the business model and solution is proven, there will be money to move to a custom-build stack but during incubation and crossing-the-chasm enterpreneurs should be able to focus on delivering value to their customers and not on re-inventing the startup wheel.
I want to take the opportunity to make some suggestions that would make Fon a really disruptive player.
Fon has some really nice residential WiFi routers. A basic version, the Fonera Simpl with an optional antenna, Fontenna, to reach more distance. Additionally there is the Fonera 2.0 N which allows a community of developers to extend the product with new functionality. Finally they can embed their software into operator’s existing WiFi routers.
Fon’s routers are based on OpenWrt, an open source Linux firmware distribution for embedded devices. Developers can create extra plugins / packages that can be deployed on the router.
How to make Fon more disruptive?
For many technical people having access to a global set of WiFi points all over the globe is a really good reason to buy a Fon WiFi. Unfortunately non-technical people might be lost in the technical details about how you can access somebody’s else Internet and might be scared of other people using their Internet. So for most people the Fon offering is like a vitamine and not really a painkiller.
By changing the value proposition of Fon towards becoming a painkiller for more people, Fon would be able to get more active demand for its products from consumers and also via telecom operators.
Fon painkiller example: Parental Control
Most parents would not care less which router is used to access the Internet. The only thing they know is that their offspring knows a hundred times more about Internet then they do. Additionally they know that Internet is full of dangers for kids and teenagers. Children always tell their parents they need Internet to do their home work. But reality is that most surfing is not done for homework
So what if Fon would have an OpenFlow compatible WiFi router with FlowVisor combined with a Cloud solution. To spare the technical details, the summary is that parents would be able to partition their Internet access based on who is accessing. What would this bring?
Kids Internet – 3-8 year olds would only have access to a strict whitelist of Internet pages. Parents would not have to find this white page themselves. Instead people and companies could make white lists and parents could subscribe to them. Examples could be a Disney white list, a SuperNanny [the television show] whitelist. Parents would know that their young children could never go to pages that are unsuitable. Young children would have a start page with icons like the iPad in which they can click on the page and immediately go their favourite games or watch cartoons. Children could be limited in the time they can spend on Internet and special bonus points for good behaviour could buy them more time or bad behaviour could be punished with less time. Parents would need an “Apple” friendly interface to pick whitelists and set-up and manage Internet access times.
Pre-teens / Teens Internet – 9-17 years od – restrictions apply. Parents could define studying time slots in which only certain Internet content can be accessed, e.g. Wikipedia. Also here external entities could define whitelists. Time-based filters for open Internet access could also be set. Additionally special purpose filters are set-up, e.g. Facebook, Twitter, MSN, Skype, eMule, Google+ etc. This would allow teens to access Facebook and other sites but to have their behaviour screened. Teens could be prohibited to upload pictures of persons, share email/telephone or physical addresses, use F* words, access adult content, etc. There would be a dynamic firewall for each service. Parents could have a high-level reporting interface to see what their kids are doing.
Parental control is just one example of how a generic router that is connected to a niche Cloud application could be a painkiller for parents. Operators could have other pain points, e.g. reduce botnets, spam, P2P content optimization, etc. Shop owners could have other pain points, e.g. social games for bars, etc.
A lot of possibilities are opening up if routers could be externally managed and very specific easy to use interfaces and solutions are build towards which communities and external companies can contribute and generate new revenue with.
The fact that every Fon router will give you access to a global free broadband network will be a nice add-on for most…
Not so many years ago, Europe was the leader in telecom. Nokia was the dominant phone maker. Symbian the dominant operating system. GSM/GPRS/3G driven from within Europe. Ericsson the dominant network solution provider.
Fast forward 2011/2012
Only Ericsson is still leading the network solution market. Their mobile arm is being absorbed by Sony however. Symbian is dead. Nokia is in coma, let’s hope its doctor from the Microsoft hospital is able to revive them. LTE is being deployed widely, except for Europe.
The new rulers are Apple, Google and Huawei. Countries like South-Korea and Japan have gigabit fiber to the home. Something no European country can match.
What should Europe do?
First of all there is a legal problem in Europe that blocks a lot of innovations from reaching Europeans. Europe does not exist in telecom world. Instead there is a collection of small and medium countries that each have their own incumbant operator and legal framework.
The first thing should be to move the telecom legal framework to European level and stimulate the creation of one open market. It can not be that in Germany or France it is not possible to get a virtual phone number [DID] without having an address of residence. Services like Twilio have a hard time to deploy in Europe because of this.
The European Union should drastically reduce its help to farmers, especially industrial farming, and instead use the funds to build gigabit fiber-to-the-home. The UK model whereby the fixed infrastructure is separated from the go-to-market entities should be a good model to follow. If we want to have more Internet companies in Europe, we should start by having fast Internet in all mid to large cities. As well as LTE access for all Europeans in 2013.
European Silicon Valleys
The next step is to create European Silicon Valleys in which startups and universities get easy access to venture capital. Without European innovation, it is hard to see how the European telecom industry will blossom again. Large telecom operators have shown few success-stories when it comes to telecom innovation. They are better at buying successful startups, then starting new innovations themselves. But before you can buy, you must have them first.
What is the alternative of not doing anything?
European employment will suffer. Telecom hardware and software development will be moved permanently to China and India. With only some small design shops in Europe at best.
Operators will become bitpipes which means that only a fraction of the current employees are needed.
American dotcoms and large corporations will attract all investments.
If there ever was a time to feel European, now is the time…
Cloud Computing is reaching the tipping point. SaaS is on the verge to balloon. Mobile apps are moving to the enterprise as we speak. Small, medium and large companies will need to mobilize their back office systems.
What better a solution can operators offer then a mobile SaaS enablement platform? A platform in the cloud that allows companies to connect in a secure way their back office systems and to expose internal data to third-party mobile SaaS. Hundreds of small software companies can be making specialized mobile SaaS offerings to allow companies to easily “approve travel expenses”, “monitor KPIs on the go”, “remotely reserve a meeting room”, etc.
Unified Back-office Exposure
Companies would find tools to expose internal data sources and back-office systems as web services. Data islands are exposed and protected via technologies like oAuth. User management and security are managed from a central dashboard. Unified web services interfaces can standardize the exposure of different back-office systems, allowing for mobile SaaS applications to work independent from for instance the back-office ERP that is being used.
The operator is the perfect companion to expose internal resources via secure communication links.
Developers can find a list of tools that take the repetitive tasks out of creating SaaS. Federated user management, multi-tenancy data store, mobile interface designer, integration frameworks (messaging, web services, oAuth, etc.), virtual application servers, long tail monetizing tools (e.g. subscription management), on-demand call center and CRM tools for support, etc.
Enterprise App Stores
Employees can access enterprise app stores in which they can use mobile SaaS applications, either on subscription basis (hourly, daily, monthly, yearly, etc.) or after one-time purchasing. Everything goes immediately on the cost center of their department after manual or automatic approval and is paid via the enterprise’s telecom invoice.
Long Tail Support
Eco-systems of support organizations, on-demand call centers, online trainings and certification programs, etc. can all make sure that enterprises get the support they need.
Show me the money
Operators can charge for sign-up or listing fees, get revenue shares from mobile app sales and support subscriptions, etc. Developers can move solutions from public app stores to enterprise app stores and charge instead of €0.79, several (tens of) euros as a one-time or subscription fee. Software would no longer have to be purchased by IT but can be “used when needed” and only paid for when it really solves a business problem. Also end-users would be able to use the software they really need and not have to wait for a corporate policy update.
Telefonica recently restructured its business units and now has a separate business unit called Telefonica Digital that is ran from the UK and has several offices around the world: Sillicon Valley, Madrid, etc.
Telefonica Digital is a clear sign that the traditional telecommunication business is no longer going to be the growth engine for Telefonica. So what should Telefonica Digital focus on. Here are five ideas. Some are already partially in progress but ease-of-use, consistency and completeness often can be improved.
1) Become the European Netflix
Google and others are likely to enter into the European market for all-you-can-eat video-on-demand, a.k.a. pay a monthly fee and see all movies, music, series, documentaries, etc. you want. Netflix is the American success story however there is still a window of opportunity to become the European one. Having great content is key in this market. However the most important competitor is not a company but a protocol: P2P. Some European countries have high piracy rates. People are getting accustomed to downloading movies and music for free. The longer Hollywood holds on to high prices in the digital age, the more chances there are that people will not want to pay any more for content. Even when all-you-can-eat service becomes available. Sometimes it is better to have every family pay €15/month then to have almost nobody pay €20/DVD.
2) Long-Tail Partner Eco-System
Open system for partners, big and small, to easily integrate into Telefonica’s back-office systems. Partners should be able to:
- charge customers and handle recurring subscriptions
- have single sign-on solutions and access to user profiles
- update Telefonica’s inventory and CRM systems without magic
- provision Telefonica’s base services (e.g. numbering plans, VLANs, etc.) in one-two-three
- long-tail monitoring and alarming
- long-tail settlement engine
- long-tail support systems
- Escrow and standardized contracts
- Standard revenue sharing arrangements in which partners get the lion share.
Having a long list of long-tail partners will boost innovation at a relatively small cost. A regular operator takes 12-24 months from idea to production launch. In the digital era, new services should be launched daily. Without partners this is impossible. Telefonica should focus on lowering the entry level so two people in their garage can benefit as well.
3) Telco & Mobile PaaS
Offer easy to use telecom APIs to key assets like billing, network quality of service, user profiles, micropayment subscriptions, etc. Allow developers to integrate these telecom APIs into SaaS and mobile apps/SaaS. Have tools to easily create mobile SaaS and native apps. A cloud-based environment to host SaaS. Have a marketplace where customers can easily buy and provision the combined solutions. Solutions to support customers that need help for solutions they have purchased.
4) M2M PaaS
Similar to Telco PaaS but for machine-to-machine and the Internet of Things. Specific hardware plug-and-play functionality, backoffice plugins for monitoring/alarming/management interfaces, etc.
5) The Paypal of Mobile Payment
Operators have a limited time left before alternative systems will disrupt the micro-payment “oligopoly”. NFC solutions, micro-payment subscriptions, mobile payment, etc. are still not standard. Mostly not because of technical limitations but because the whole eco-system wants to see a high margin business. High-volume low-margin would however change the potential of short-term success. What if a micro-subscription (€0,10/month) would leave a merchant with €0,09 instead of €0,05 or less? The window of opportunity is closing fast however…
The European telecom market has been a fragmented market with many languages and local laws. Small successful US dotcoms often completely avoid Europe. This makes the European operators feel relatively safe and not aware of the disruptive technology that awaits them.
How could Google disturb the current European telecom market?
1) Become a Pan-European MVNO and offer cheap no-roaming data plans.
Tablets are reaching the Tipping Point. If Google would offer one SIM to cheaply access the Internet everywhere in Europe, then operators would loose out enormous roaming revenue and their most lucrative market segment: travelling businessmen.
Google could also allow the usage of this data plan in mobiles and offer Google Voice and Talk on the mobile via VoIP.
2) Micropayments together with Energy providers
Telecom operators have been reluctant to set-up a long tail eco-system of partners that can sell services, content and apps and charge them directly onto your phone bill. Each operator has its own interfaces, if any. The operator’s revenue share is extremely high, making most business models unprofitable.
What if Google would partner with giants in other industries? Would consumers mind if their online game purchases would be billed on their electricity bill instead of on their telephone bill when the amount is below €2? They would probably not. The energy giant has to send you a monthly bill anyway, so getting some extra profit would be nice for them.
3) Top-up NFC with no merchant commissions
In your Android mobile you would use your NFC (near field communication) device to pay small amounts. From time to time you would recharge your mobile via Google’s Checkout or enable an auto-recharge. Merchants would receive the combined money transfer at the end of each month but would not pay commission. How would Google make money? A top-up and late payment to merchant means that Google can hold large amounts of money for easily 30 days. The interests should go far in paying daily operations costs. Additionally you would share with Google all your purchases, so they can target you with virtual coupons and other long tail advertisements.
4) Youtube + Google TV can become the European Netflix
For those not familiar with Netflix, and similar services, it is a “cheap” all-you-can-eat video-on-demand service in the US. It streams the latest movies and series from the Amazon Cloud right towards your SmartTV, Set-up Box, Tablet or PC. Prices have recently gone up but are still relatively cheap.
Using Youtube’s streaming platform and Google TV’s content, operators could be seeing their data network costs skyrock without any major revenue gain.
5) Combine all of the above
Google could be launching all of the above in a very short time period, leaving operators no time to react. Roaming/calls/SMS would drop enormously, third-party revenue from premium SMS would drop, lots of new innovative services sold over-the-top and an unseen bandwidth usage explosion.
Sometimes you wish you would be working for the other side…
If you take a look at the type of SaaS solutions that are currently in the market then you see a lot of generic solutions: hosted email, backup in the cloud, CRMs, ERPs, etc. Although these solution will continue to exist, the future of SaaS is more likely to be in specialized solutions that either focus on a specific customer segment or a specific type of solution.
These specialized SaaS will help a doctor to manage patients, a professor to teach better, a grocery to sell more, a software architect to design better software, etc. The specialized SaaS will be a mix of web as well as mobile SaaS and ideally should be integrated with operator’s telecom assets, e.g. subscription based billing on your telecom invoice.
Telecom operators should start enabling dotcoms instead of ignoring this potentially highly profitable innovations. Operators have many assets to offer that small companies will appreciate, at least if they come at the right price. This is the time to start enabling this new ecosystem.
Are you planning your Cloud strategy for the next 6 months? Do not forget Mobile PaaS on the top of your list…
What is Mobile PaaS?
Several years already people are saying mobile apps will be hot. However how many businesses do you know that are actively using mobile enabled applications? Yes there a few. If you count email on the mobile then almost all of them. However most of them have not mobilized their IT solutions yet. Most managers are travelling extensively. Working from home is becoming more popular. Being on holidays no longer means not thinking about work at all.
To the rescue comes Mobile PaaS. The platform that allows companies to mobilize everything easily. Mobilize their sales, their internal operations, their partner networking, their whole IT strategy…
Companies will want to have access to their time reporting tool from a mobile app or tablet. The same is true for approvals, travel requests, the product catalog, the employee addressbook, etc.
What should a good Mobile PaaS offer?
1) Mobile applications need to be easy to access – a single sign-on and you are able to access a virtual desktop from your mobile, your companies intranet, a mobile app that integrates into a companies backoffice systems, an HTML5 app hosted by a partner, a mobile SaaS solution, a flexible mobile business process designer/executer, etc.
2) A marketplace to buy what is already available – for those mobile apps and SaaS that are already out there companies should pay as they use or a subscription fee. Reinventing the wheel is useless. Being a single point of access will have people come back for more.
3) A mobile enabling platform – put a mobile GUI on top of companies exposed APIs. If a company has a backoffice system that has an API, then a secure API access (e.g. VPN) and a mobile graphical designer application similar to force.com but for the mobile, should allow companies to quickly build custom apps for their existing systems. A step further would be to have third-parties create client apps for those legacy systems that are still out there and sell the apps via the marketplace.
4) Virtual mobile desktop – having a virtualized mobile desktop solution for a tablet or having access to a mouse and HDMI TV would allow people on the go to use their tablet or smartphone as a computer and still access a full desktop.
5) Mobile sales enabler – allow companies to sell their existing products via a new mobile channel quickly. Mobile catalogs for a tablet, instead of paper catalogs. Google is also entering this market now with Google Catalogs. Adding open provisioning interfaces will allow one click purchasing on the go to be linked with existing backoffice systems.
6) Mobile assets and APIs – offer assets and APIs to charge small purchases directly on your mobile bill, APIs to manage a catalog for a mobile store, APIs to deploy a virtual mobile desktop, APIs to integrate a corporate single sign-on solution, etc.
It is five to twelve. Dotcoms are already active in this space. You should think about working together with some established provider that know your legacy systems and a bunch of dotcoms that you never heard of before but that can bring innovative products. The window of opportunity closes mid to late 2012. So if you plan on launching an RFI, then an RFP, selecting a vendor, implementing a waterfall project and launching by 2013 then you better not start…