October 20th, 2009

What EuroCloud means for SaaS in Europe

Posted by Phil Wainewright @ 4:14 am

Categories: Europe, Uncategorized

Tags: Software-as-a-service, Europe, Membership, Software As A Service (SaaS), Managed Hosting, Cloud Computing, Emerging Technologies, Phil Wainewright

Today EuroCloud, a new industry organization that aims to promote cloud and SaaS, launches in seven European countries. I’m involved in the initiative, having agreed to act as UK co-ordinator for the launch. Other groups are launching in France, Denmark, Finland, Belgium, Luxembourg and Spain, and the launch has the backing of almost thirty SaaS and cloud vendors, ranging from giants like Amazon, Salesforce.com, Microsoft and McAfee to up-and-coming local players including Huddle, INES, Mimecast, NTRGlobal and Twinfield. Full details are on the website and in the launch press release (PDF). Initial blog coverage (in addition to this post) has been by Dennis Howlett, David Terrar and Ben Kepes, and there’s developing multi-language news coverage across Europe.

I’ve written in the past about the difficulties European SaaS vendors face in expanding across borders and getting the visibility they deserve. There are a huge number of highly successful SaaS vendors in Europe, who are thriving in spite of the challenges of expanding across borders into different languages, cultures and business jurisdictions. The lack of established European-wide tech industry networks and media leaves them doubly sidelined — unable to command visibility against better-known US-based peers with the global tech media, yet sidelined by local tech media in their own countries because SaaS isn’t considered part of the mainstream software business.

EuroCloud changes that by creating a ‘go-to’ destination across Europe where everyone will be able to see, just by scanning the membership list, the breadth and depth of indigenous SaaS and cloud players. Today EuroCloud issues its call for membership so the names aren’t there yet (apart from the 70 members of the pre-existing EuroCloud France) — however I know from the responses I can already see coming in to just the UK group how quickly that’s going to change. Membership is open to any SaaS or cloud ecosystem participant, and those who want to take an active role in taking EuroCloud forward have the opportunity to get in on the ground floor and help drive its momentum.

Meanwhile, we already have 29 companies listed as ‘European Launch Partners’, all of them organizations with a presence in at least two European countries. Some of my US fellow-bloggers and writers may say, Read the rest of this entry »

August 17th, 2009

How mobile networks flunked my summer roaming spend

Posted by Phil Wainewright @ 4:30 am

Categories: Business models, Customer experience, Europe

Tags: Mobile Network, Billing, Mobile, Network, O2, Billing System, Sales Channel, Customer Relationship Management (CRM), Sales, Enterprise Software

O2 and Vodafone could each have made an extra $100 or more from me this summer and doubtless from hundreds, maybe thousands of other travelers. But their antiquated billing systems and inadequate demand forecasting have cost them my business and hammered a further nail into the coffin of whatever scant vestige of customer goodwill they had left.

Let me start with O2, the holder of the UK iPhone monopoly (though soon to face Orange as a competitor, it’s rumored). Data roaming charges are a punitive £6 ($10) per megabyte outside of Europe and a still-scandalous £3 ($5) per megabyte within the European Union. The only way to bring data roaming into barely palatable realms of affordability is to buy a 50MB ‘bolt-on’ package for £50 ($84) prior to traveling, thus reducing the cost to £1 ($1.67) per megabyte. Over the past year of iPhone ownership I’ve got used to activating the 50MB bolt-on in advance of journeys abroad and then canceling it once my trips are over. Perhaps misled by the name, I had started to imagine that it might be possible to add a further bolt-on mid-trip should I find myself approaching the 50MB tariff ceiling prematurely.

No such luck, I discovered, when I phoned up to activate data roaming for my family vacation this month. It turns out the 50MB is a monthly ration and, since I was phoning up several days after the start of my billing period, I could only secure a pro-rata 40MB of £1-per-megabyte data roaming for the current month. Furthermore (and at this point I understandably went up the wall into the poor call center agent’s earpiece), since the ‘bolt-on’ had to be activated for a full monthly billing cycle, I would have to pay a full £50 charge for the following month (when I have no journeys abroad) before I could cancel it, thus jacking up the charge to an absurd £90 for a measly 40MB of data roaming while I was actually traveling.

After putting up with my extensive remonstrations, the agent got authority to waive next month’s charge, but I was still left fuming at the total mismatch between what O2’s no doubt hugely expensive billing system is able to handle and what I as a consumer actually need and want to do. This notion that there is a 50MB roaming entitlement that is spread across a billing period is clearly Read the rest of this entry »

June 16th, 2009

Netviewer aims to outshine WebEx in Europe

Posted by Phil Wainewright @ 6:55 am

Categories: Collaboration, Ecosystems, Europe, Software licensing, WebEx

Tags: Web, WebEx Communications Inc., Europe, Citrix Systems Inc., Online Meeting, Remote Support, Netviewer, Web Meeting, Remote Administration, Web Conferencing

With more than 15,000 customers in 55 countries, one of Europe’s largest indigenous SaaS players is Germany’s Netviewer. Its online meeting platform is a rival to well-known US names such as WebEx (part of Cisco) and the GoToMyPC/GoToMeeting products from Citrix OnLine. Already the number two web meetings player in Europe in 2007 (according to market researcher Frost & Sullivan), the company added venture backing last year from Deutsche Telekom subsidiary T-Online Venture Fund and European Founders Fund, the investment vehicle of Internet luminaries the Samwer brothers. I had a chance a couple of weeks ago to connect with Netviewer’s founder and CEO, Dr Andreas Schweinbenz (pictured), to find out more about the company’s plans.

It’s still early days in the growth of the European market for web meetings, he believes, and pointed to a Gartner chart on which the European market value of $378.9 million in 2008 just happens to equal the US market value of $378.2 million in 2003. Considering the total GDP of the economies are roughly equivalent, that suggests the European market is around five years behind the US.

Another interesting comparison I’d add is to look at the US players back in 2003. WebEx already had a dominant 50 percent share with revenues of $189 million, but privately-held ExpertCity, which became Citrix Online on acquisition in February 2004, made somewhere in the $20-30 million range. Netviewer is about the same size now, based on its published accounts for 2007 (the latest available under German rules for privately-held companies). It reported gross income of €14 million in 2007 (around $20 million at the prevailing exchange rate). Citrix financial statements for 2008 show that in the five years since 2003, its online services subsidiary has grown to become a $260 million-a-year business. If Netviewer can rival or better that 10x growth over the coming five years, it has a rosy future ahead of it.

Unlike Citrix Online, Netviewer has decided against continuing to focus its efforts on the remote support market — even though that’s where it started out. “We see the larger market in the future is the meeting area,” explained Schweinbenz. That choice, incidentally, avoids crossing swords with Europe’s other significant player in this sector, Spain’s NTRglobal, which is concentrating on remote support rather than Web meetings [disclosure: NTR is a recent client, WebEx has also been a client].

Netviewer is in no hurry to take its wares to the US market, either. “Let’s not get de-focused by trying to expand internationally too soon,” said Schweinbenz. Its clear target is to be the European number one in web meetings. “The online meeting business is still in its early stages,” he said, and growth is rising: “The economic crisis is pushing the market because people want to save money.”

The company has several initiatives under way to accelerate growth. The first is a partnership strategy to encourage Read the rest of this entry »

May 31st, 2009

SaaS in Europe at the tipping point

Posted by Phil Wainewright @ 4:37 am

Categories: Europe, Market research

Tags: Software-as-a-service, Europe, Software As A Service (SaaS), Managed Hosting, Cloud Computing, Emerging Technologies, Phil Wainewright

With just ten days to go before this year’s SIIA OnDemand Europe conference opens in Amsterdam on June 9, I’m looking forward to a few surprises about the strength of SaaS in Europe [disclosure: SIIA has paid me to help develop the agenda]. There seems to be a widely held view that Europe is a laggard in SaaS adoption, and yet the line-up of speakers at the conference demonstrates there’s a thriving industry in the region, with strong global and regional SaaS players from Sweden, Denmark, France, Germany, the Netherlands, Spain, the UK and elsewhere.

Research to be revealed at the conference by IDC’s David Bradshaw finds that three-quarters of businesses in France and Germany are already users of SaaS (and the proportion in Spain tops 85%, although surprisingly the UK comes out lower at around two-thirds). I’m interested to see the detail behind those figures — especially as they seem to contradict some of the findings that Gartner reported back in April. But the overwhelming message I think delegates will take home with them is that the European market for SaaS has quietly reached a tipping point and is about to blossom (more SaaS in Europe coverage).

With that in mind, I want to make sure that European ISVs and SaaS start-ups get every chance to be there in Amsterdam. No other event in Europe provides the same breadth of SaaS and cloud expertise for ISVs that want to validate their SaaS strategies against the industry’s emerging best practices. I’ve therefore persuaded the SIIA to make available a limited number of half-price registrations, exclusively for Europe-based ISVs, solution providers or SaaS start-ups with annual revenues of €10 million or less. Anyone wishing to apply should email me (pw AT pcxvs DOT com) no later than midnight Tuesday June 2nd, with a couple of sentences on why you should be in Amsterdam. I’ll send out a special registration code to those selected so they can register at the reduced price on Wednesday June 3rd, which is the final day for online registration. [UPDATE added June 3rd: online registration is now extended till Friday and I have one more half-price ticket on offer - contact me as above, first come, first served].

As well as a strong indigenous flavor, we have all the big names of SaaS on the agenda. The opening keynote is by Zach Nelson, CEO of NetSuite. John Wookey from SAP is delivering his first keynote since joining SAP from Oracle, speaking about on-demand in the enterprise. Adrian Joseph, the new head of Google Enterprise EMEA, will provide a counterpoint view on the same topic. Other top names on the agenda include Steve Lucas from Salesforce.com, Werner Vogels of Amazon.com, Mani Gill from SAP BusinessObjects, Annrai O’Toole from Workday, Mikkel Asger Svane from Zendesk and others from Oracle, Progress Software and Microsoft Online Services. Our user panel includes Oracle CRM OnDemand user Kodak and 3,500-seat Google Apps user Permasteelisa from Italy.

Naturally, I’ll be blogging and tweeting from the event (in between acting as conference chair) so expect a strong European flavor to my postings over the next couple of weeks. If you’re registered, I look forward to seeing you there in person.

April 16th, 2009

SaaS adoption swells in Europe

Posted by Phil Wainewright @ 3:33 am

Categories: Europe, Market research

Tags: Software-as-a-service, Europe, Software As A Service (SaaS), Managed Hosting, Cloud Computing, Emerging Technologies, Phil Wainewright

There are some interesting patterns to adoption of SaaS in Europe, which despite the efforts of the European Union to bring us all together, is still more of a collection of separate countries than a single market, especially when it comes to business applications. I’ve discussed some of these in a video interview recorded by Dennis Howlett last week when we were both at Cloudforce London.

One of the most interesting phenomena is a subtle shift in adoption patterns away from the traditional progression, which usually starts with early adoption in Nordic countries, then shifts to the Netherlands and UK, and finally flows out to France, Germany and the rest of Europe. Anglo-Saxons will be dismayed to learn that France now appears to have edged ahead of Britain in the adoption race. This is borne out not only by my own anecdotal evidence and but also by recent research from Gartner, which found that “71 percent of French respondents said that their organisation currently uses SaaS for enterprise applications, compared to 68 percent in the UK and 45 percent in Germany. Gartner also reckons more French workers actually use SaaS when it’s made available to them.” (Report from UK technology website Hexus.channel. Another UK site Manufacturing Computer Solutions also covered the story).

Adoption remains highest in countries like Denmark, Sweden and the Netherlands, where today The Next Web conference is in full swing, including startup showcase presentations by these Web 2.0-oriented SaaS vendors: CoTweet, Huddle, Prezi and Quick TV.

Next Tuesday (April 21st), I’ll be flying to Rotterdam for a half-day event on Making Money with SaaS, which has speakers from Progress Software, Salesforce.com, OpSource and local SaaS players 4Projects, Continuans, SaaSplaza, Twinfield and Xceliant. This is the second Read the rest of this entry »

March 17th, 2009

Denmark first, then the world

Posted by Phil Wainewright @ 6:09 am

Categories: ERP, Europe, Venture capital

Tags: Revenue, Software-as-a-service, Europe, Denmark, E-conomic, Software As A Service (SaaS), Managed Hosting, Cloud Computing, Venture Capital, Internet

As confirmation that Europe has its own indigenous SaaS stars, allow me to introduce e-conomic, a Danish online accounting vendor (UK site here) that’s been posting 60% annual growth rates for the past two years and is projecting up to 40% growth for the current year. With 2008 revenues of $5.6 million (32 million Danish kroner), the company is typical of a new generation of SaaS startups that are beginning to find their feet now across Europe (more Europe stories here), and will be one of many taking part in this June’s OnDemand Europe conference in Amsterdam, which I’m helping to organize (see disclosure).

Unlike in the US, private companies in most European countries are legally obliged to file public accounts each year. E-conomic has made a virtue of this by announcing its 2008 results in a press release (PDF) last week, along with its projected revenues for 2009 — an estimated DKK43-45 million, or just over $7.5 million. Its subscriber base stands just shy of 18,000.

I’ve written before about the difficulties European vendors face when expanding beyond their home country. The Nordic region is a microcosm of that challenge, with each country retaining its own currency, language and statutory framework. “It is by no means easy,” said Torben Frigaard Rasmussen (pictured), CEO of e-conomic International, when we spoke a week ago. “Denmark, Sweden and Norway are competely different countries.” But the flipside is that it’s far easier to get established in that home market and then use what’s been learnt there to expand elsewhere. E-conomic says it already holds 25 percent of the Danish market, and the profits being generated there are funding expansion elsewhere. It’s the equivalent of a US company getting established in, say, Read the rest of this entry »

March 2nd, 2009

Microsoft pumps cloud, trumps Google with GSK

Posted by Phil Wainewright @ 6:50 am

Categories: Collaboration, Europe, Microsoft, Service level management

Tags: Google Inc., Microsoft Corp., Glaxo SmithKline, GSK New, Service Level Management, Cloud Computing, It Operations, It service Management, Phil Wainewright

Announcing a 100,000-seat deployment by pharmaceuticals giant GlaxoSmithKline (GSK), Microsoft Online Services — the software vendor’s hosted Exchange, Sharepoint and LiveMeeting division — today stepped up its validation of cloud applications at the same time as making Google Apps’ 15,000 seats at biotech leader Genentech look small by comparison.

Not only that. Ron Markezich (pictured), corporate VP of Microsoft Online Services, was scathing of Google’s efforts to make headway in the enterprise market. “Google we really do not feel is ready for the enterprise,” he said in a call briefing bloggers on the announcement an hour ago. “They’re offering three-nines SLA and they’ve missed three of the last six months,” he added, referring to last week’s Gmail outage and earlier incidents. In a sideswipe at Google’s offer of a 15-day credit for last week’s outage, he went on to add that Microsoft maintains its services at four-nines availability, while backing up its three-nines SLA with financial penalties: “We don’t just give service credits, we give hard dollars if we miss an SLA.”

He went on to dismiss Google in terms that made the search and contextual advertising giant sound like little more than a minor irritation in Microsoft’s competitive landscape. “Pretty much all our major customers are trialing Google Apps, but they’re buying Microsoft Online Services,” he said, reeling off a list of blue-chip names that have recently signed up for Microsoft’s online applications — Phillips, Ingersoll Rand, Pitney Bowes, Aviva. Those others who had chosen to go with Google had made a poor choice, he went on to imply. “They’ve just chosen to take email and use a consumer service that’s not enterprise-ready,” he said.

The GSK news has been timed to coincide with the launch of Online Services in nineteen countries worldwide (also see Mary Jo Foley’s write-up), along with the release of the Office Communications Online instant messaging and presence service ahead of its original schedule. The new services are Read the rest of this entry »

February 25th, 2009

Did privacy laws bring down Gmail yesterday?

Posted by Phil Wainewright @ 7:45 am

Categories: Collaboration, Customer experience, Europe, Google, Service level management

Tags: Google Inc., Google Gmail, Data, Europe, E-mail Providers, Cloud Computing, Internet, Phil Wainewright

I was idly scanning The Register’s write-up of yesterday’s Gmail outage in Europe when this explanation from Gmail reliability manager Acacio Cruz caught my eye:

“Unexpected side effects of some new code that tries to keep data geographically close to its owner caused another data centre in Europe to become overloaded, and that caused cascading problems from one data center to another. It took us about an hour to get it all back under control.”

Why is Google developing code to keep data ‘geographically close to its owner’? Europe’s privacy laws, is my guess. This is a topic I’ve been following over on The Connected Web, where I recently posted about a phenomenon I’ve called data protectionism: “One important obligation on any business operating within the EU is a continuing responsibility to ensure the security and privacy of data transferred elsewhere.” This week I followed up with news of a World Privacy Forum report that helpfully spells out all the implications for cloud providers and consumers.

Here’s how this ends up bringing down Gmail:

1. Google successfully recruits several large European enterprises to Google Apps;
2. Those businesses express concern about their data privacy obligations under EU law;
3. Google’s engineers start developing algorithms to keep data from straying beyond certain geographic territories;
4. Those algorithms behave unexpectedly during a routine upgrade;
5. Gmail goes down.

I have no evidence for this chain of events apart from what Cruz wrote, but why else would Google want to keep data “geographically close to its owner”? In cloud computing terms, the notion is almost absurd — and of course absurdity is precisely the sort of thing that produces unexpected outcomes in any system.

Absurd though it may seem, the point is a crucial one for cloud providers to take on board. Their infrastructures are going to have to build in awareness of real-world jurisdictions so that providers and their customers can demonstrate compliance with undertakings on matters of national law such as data privacy, intellectual property rights and taxation. Shifting data across a national boundary during an outage can have serious legal repercussions, and the cloud has got to take that into account — but without falling over.

February 11th, 2009

Sage shows why bigcos can't be trusted with SaaS

Posted by Phil Wainewright @ 3:42 am

Categories: Development, ERP, Europe, Security, Uncategorized

Tags: Security, Accounting, Software-as-a-service, Software Company, Sage Live, Software As A Service (SaaS), Managed Hosting, Cloud Computing, Emerging Technologies, Phil Wainewright

The first of my promised SaaS stories from Europe ends with an uplifting David-and-Goliath twist, but is first and foremost an object lesson in how not to introduce a SaaS offering, courtesy of one of the world’s leading small business software vendors, UK-based Sage. I know I ought to start with one of the many positive stories about SaaS in Europe, but I’m steamed up about this one, so here goes.

After a claimed 18 months in development, Sage at the turn of the year unveiled the beta of Sage Live, which combines a free-of-charge invoicing application and a simple £10-per-month accounting product for small business owners. Although to my mind I found it a bit too simple from an accounting point of view (no multi-currency support for example), it has some interesting Web 2.0 features such as integration with Google Docs and Google Calendar, keyword search across the application, support for RSS feeds in the dashboard and a Blackberry mobile client. Online accountancy watchers Ben Kepes and fellow-Enterprise Irregular Dennis Howlett both gave it positive reviews, while noting that this was a beta release and Sage was keen to listen to feedback and evolve the product.

But two weeks ago, Sage Live went dead after serious security flaws were exposed in the product, leading the company to shut down the beta trial. This is where the David-and-Goliath angle comes in. The flaws were exposed by the blogging founder of a tiny SaaS rival to Sage. Duane Jackson, CEO of UK-based KashFlow, which just last week celebrated passing the 2,500 customer mark, decided to have a detailed look at his rival’s offering and immediately blogged about what he discovered:

“Almost unbelievably, [Sage Live] show[s] your password on-screen when you log-in — in plain text. It’s sent to [Sage's] central ‘passport’ service using a GET rather than a POST — so your password is actually in the requested URL which is displayed in the status bar … Make sure no-one is looking at your screen when you log in …

“A little bit of prodding around the site and I found myself looking at … pages that only authorised people should be seeing.”

Russ McRee, a security analyst with Microsoft Online Services and (via his personal blog) a deadly scourge of flawed SaaS security practices, found additional problems and reported them to Sage, as did many others over the following days. A week after Jackson posted his findings, Sage took the service completely offline and it has not yet been restored.

I’m not privy to what went on within Sage during the development and unveiling of its new offering, but it seems clear that Read the rest of this entry »

February 9th, 2009

Cloud and the European SaaS provider

Posted by Phil Wainewright @ 2:53 am

Categories: Europe, Platform as a service, Utility computing

Tags: Software Information Industry Association, Software-as-a-service, Europe, Conference, Software As A Service (SaaS), Managed Hosting, Cloud Computing, Emerging Technologies, Phil Wainewright

I’ve been spending some time recently researching the SaaS scene in Europe, while preparing the ground for the SIIA OnDemand Europe conference in June, for which I’m helping to co-ordinate the agenda [as a paid engagement: see disclosure]. Although most of the well-known names in the SaaS business are US companies, there’s a strong contingent of European SaaS vendors and they deserve more attention — in fact I hope the June conference will be a big showplace for them. So over the next few weeks I’m going to be highlighting one or two specifically European stories here on this blog.

One key theme is the interaction of SaaS and the cloud, which is the topic of a pre-conference seminar hosted jointly by the SIIA and IBM next Wednesday 18th February in London, called Cloud and the SaaS Provider. Europe has a lot of cloud pioneers — Q-Layer, which Sun recently acquired, is based in Belgium; there’s a strong Amazon presence here, along with competitors such as Flexiscale and ElasticHosts, and cloud management vendor CohesiveFT, whose co-founder Alexis Richardson is speaking at the seminar, has an important base here. Last week I met many of these vendors at the PoweredByCloud conference, and they’ll all be making an appearance at next month’s Cloud Camp London (which I’ll miss as I’ll be in San Francisco that week for SaaS Summit 2009).

Next Wednesday’s half-day seminar is the first event that looks at cloud from a specifically SaaS ISV perspective, covering issues such as: what factors to consider when moving to cloud infrastructure; how to evaluate the costs and risks of competing cloud platform; as well as the business impact of moving to the cloud. There will be speakers from ISVs who’ve made the move, including CODA, which last year launched the first financials application developed on the Force.com platform. There will also be speakers from IBM, BT and Microsoft, and participants from Salesforce.com, OpSource and other providers.

My own view is that the downturn is going to force many ISVs to turn to cloud infrastructure to enable their SaaS initiatives, so I’m going to be interested to see what the general feeling is about moving to the cloud. From what I’ve seen, European vendors are not holding back any more than US vendors, and there are plenty of indigenous providers and cloud experts, so this may be one technology that gets adopted just as fast in Europe as in the US.

For those interested, the seminar is free to SIIA members and IBM or Progress Software partners, and other participants will have the registration fee credited if they go on to register for the June conference, which is shaping up to be a strong event (even though I say it myself), with keynotes from NetSuite’s Zach Nelson and SAP’s John Wookey as well as Google and many other key players on the agenda.