saasplaza software + services

Software + Services

Agenda:1. Microsoft’s odyssey into S+S2. What about SPLA3. Major complains about S+S

Herb ProoyMarket Maker - SaaSplaza

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What is Software as a Services (=SaaS)?

Customer view: Software is running anywhere else, without

investments and I only pay a price per user per month;

Technical view: Software is running on a scalable,

virtualized ‘non-dedicated’ infrastructure;

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SaaS is becoming a mainstream choice

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2007 2008 2009 2010 2011

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Small Business Lower Midmarket Upper Midmarket Enterprise Market

The CAGR for on-demand ERP will be 20% through

2011, (SMB market will account for

86%) *

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Microsoft’s odyssey to SaaS

Early 2006 Steve Ballmer stated that Software as a

Service strategy became a cornerstone of the

Microsoft strategy

Channelweb June 4ht 2006 - Steve Balmer:

Microsoft depends on partners to sign up new customers.

"There will have to be a business relationship that facilitates

that"

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Mid 2006 : Incubation Centers + SPLA

Appointing 10 SaaS Incubation Centers to support Partners in their transition;

Announced the SPLA license program. A bold step for a dominant software supplier and still not followed by other established competitors.

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2007 : Software + Services

On the WPC July 2007

Software as a Service redefined by

Microsoft to Software + Services

In the new era of ‘service disruption’; it is not only about

the software but more and more about the services.

Web-services but a also added value services.

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2008 : S+S products

March 2008: Release of CRM 4.0. Web enabled, multi-tenant version

July 2008 :Announcement of BPOS Microsoft announce the offering S+S from their

own Platform and invoicing customers directly Partner receives 12% +6% kick-back;

July 2008 : CRM offered from the Microsoft ‘Cloud’

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The “Cloud”

Cloud Computing refers to both the applications delivered

as services over the Internet and the hardware and systems software in the datacenters that

provide those services.

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Today’s S+S landscape

InfrastructureHardware &

Software

Collaboration andMessaging Solutions

Business Applications

Hosters

ISP’s & Telco’s SaaS

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Microsoft S+S landscape

InfrastructureHardware &

Software

Collaboration andMessaging Solutions

Business Applications

Azure

BPOS

CRM

Hosters

ISP’s & Telco’s SaaS

2010

Understanding SPLA licensing

On-premise licensing is upfront and C/SIDE and RoleTailored client access are concurrent user based

SPLA licensing is per month and C/SIDE and RoleTailored client access are named user based

In the on-premise model Software Assurance (BREP) is optional; In SPLA SA this is included and required

Add-on base royalty is currently zero Some local granules price is zero (Microsoft IP) In the on-premise model the price is cost minus partner

margin; In the SPLA model price is cost to partner

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Exchange Offices Sharepoint Hosting

2007 : Go-to-market

CustomerServiceProvider

Webhoster ASP CSP BPO Platform Prov. Rental companies Streaming Media ISP’s ISV’s Outsourcers

SPLA License

Hosting fee

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2007 : Go-to-market


Traditional NAVMicrosoft Partner

SPLA License

Hosting fee

• What about margin on software?• What about customer ownership • What about deal-recognition?• What about support?

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2007 : Go-to-market


Traditional NAVMicrosoft Partner

SPLA License

Hosting fee

What about margin on software? What about customer ownership What about deal-recognition? What about support?

SPLA was not N

AV

partner p

roofed

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2009 : NAV S+S Go-to-market

Customer

NAVImplementation

Partner

Partner owns the customer! Partner makes margin on license + infra + services! SPLA deal will have recognition! Partner will get software support!

NAV ISV

SPLADistributor

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Customer

NAVImplementation

Partner

Partner owns the customer! Partner makes margin on license + infra + services! SPLA deal will have recognition! Partner will get software support!

NAV ISV

SPLADistributor

NAV partner p

roofed

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So Ready to go!

But complains are holding you back!

1. NAV S+S does not allow customizations;

2. I don’t make margin on S+S;

3. I can not motivate or pay my sales in an S+S model;

4. I’m cannibalizing my own market;

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NAV S+S can be customized

TerminalServerTerminal

ServerTerminalServerTerminal

Server

SQL-ServerSQL-Server

SQL-ServerSQL-Server

Indeed NAV is not web-enabled; But a bit ‘multi-tenant’; Infrastructure is scalable; Customizations in SQL;

Compensating your sales teams

“Initially, we tried to incent our sales orgs to tackle big accounts perpetually to offset the cash flow issue. Eventually we made comp completely neutral. Same commission no matter what the customer buys. We let the customers decide whether to go SaaS or On-premises. When the sales comp favored On-premises, it was a 50/50 split. When we made it neutral it went to 99% On-demand versus 1% after comp change.”

-- Steve Singh, CEO, Concur Technologies

http://smoothspan.wordpress.com/2007/09/25/interview-concurs-ceo-steve-singh-speaks-out-on-saason-demand/

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Incentive scheme

On-premise model

S+S model

Q1 Q2 Q3 Q4

Q1 Q2 Q3 Q4

Measuring your sales on:Growth of your recurrent revenue per quarter

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Cannibalizing your own market?

Misunderstandings: NAV S+S : is not a different product; NAV S+S : is not different software; NAV S+S is for small customers; NAV S+S is a different sale: I need a

different sales organization or different sales

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The Market is for NAV S+S

$0

$200

$400

$600

$800

2007 2008 2009 2010 2011

**M

illio

ns o

f US$

Small Business Lower Midmarket Upper Midmarket Enterprise Market

The CAGR for on-demand ERP will be 20% through

2011, (SMB market will account for

86%) *

NAV S+S Market

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It’s about addressable market

Marketshare ERP (non-enterprise)

MS-Dynamics ERPOther ERP products

The Fortune 5 million

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It’s about addressable market

Marketshare ERP (non-enterprise)

MS-Dynamics ERPOther ERP products

The Fortune 5 million

SaaS ERP Netsuite last quarter results:

•Focused on small & mid sized companies •Per month 800.000 unique users on their platform•Annual revenue $ 152.5 mil, a growth of 40,5%•Last quarter, ending Dec 2008 : growth of 30,5% to $ 41,4 mil.•In that same quarter the business spending on hardware & software drops 27,8%.•350 new customers add’s in the last quarter.•With 130 direct sales rep’s•Sales cycle varies from 30 to 180 day’s.

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What is the difference?

Or where can you make the difference? Customers decide only today when they are sure they see an

immediate pay-back; S+S offers you a24 hour delivery of an NAV instance; ISV offers immediate (vertical) added value; Prepare pre-configured instances; S+S offers OPEX no CAPEX!! No implementation risks! With a rapid implementation approach a customer will see

cost efficiency gains within a month!

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Customer

NAVImplementation

Partner

NAV ISV

SPLADistributor

SaaSplaza will help you to

fulfill your customers needs

Visit our website!

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Herb Prooy

[email protected]