The Real Cloud Opportunity for VARs: PaaS
The predominant benefit in 2009 from cloud computing was access to less expensive computing power and availability of more SaaS based solutions. But how will solutions providers make money from cloud and SaaS offerings in 2010? Here are some clues.
During 2009, VARs that promoted on-premise solutions were challenged to redefine their value-add since much of what they had built their business and expertise around was becoming commoditized. The question for many was how to participate in cloud computing in a way that allowed them to make money.
Platform as a Service
The answer: Platform as a Service (PaaS) will likely become an increasingly good opportunity for Solution Partners to leverage the cloud, continue to add value to their customers, and make money in 2010. Here is why.
Platform as a Service (PaaS) such as force.com and Google app engine provide an on-demand development environment that reduces development environment complexity, time and cost so that developers can focus on building applications. Some are taking it a step further and focusing on the needs of Solution Partners, providing very innovative ways to help them expand their business.
The current trend is improving time to market and time to revenue which is greatly dependent on how quickly you can build and deploy an application. The opportunity to add value now is not so much in technical competency but in a Partner’s understanding of the business problem that needs to be solved and then building that application in a way that adds the most immediate value to the business. As Heather Margolis pointed out in July 2009, SaaS will drive the emergence of a new type of partner, who has strong business domain expertise and who traditionally may not have focused on providing technology solutions.
Helping to make this a reality is a PaaS solution called LongJump; it provides a development environment that business-oriented and less technical partners can use to quickly and easily build and deploy custom applications. Essentially LongJump provides the building blocks to develop any type of web application through a visual, drag and drop approach. The visual interface enables anyone to create relationships between objects, define business processes, create workflow, set action triggers, and create data models and policies to develop a custom web application quickly. In addition, partners have access to pre-built applications that they are free to use as a starting point. More importantly, Partners have the ability to brand the application as their own, create a SaaS solution offering of their own, and sell to customers without investing in hardware, software, or strong development resources.
LongJump launched their VAR program last quarter that provides a development platform, backup, storage, ability to scale easily, network, security, and pre-built applications for $15/user/month. Partners can then develop web applications and sell them for whatever price they choose.
So who does this appeal to the most?
- VARS & ISVs who can now build innovative web applications easily and sell them as branded SaaS applications to meet specific vertical industry needs.
- Business Process Consultants who want to expand their value by providing solutions but don’t have the technical expertise to develop applications in a traditional environment.
- SIs & Developers who are looking for a less expensive way to develop applications for their customers and where the ability to focus on smaller projects and deliver more projects faster and for less becomes a competitive advantage.
I recall from my Borland days the huge effort required to sell just development tools and the cost and time required to implement a productive development environment. PaaS solutions like LongJump now provide immediate access to a development environment, that supports distributed development among developers in multiple locations, and enables the development of web applications faster and less expensively. As I pointed out in my November 2009 post, PaaS is another example of how the successful and smart partners will be able to leverage Cloud Computing as an opportunity for massive innovation in developing and delivering solutions to market.