On April 17-18 I was in Santa Clara mingling with the international SaaS crowd at SaaSCon. There, Eugenio and myself presented a session titled: Anatomy of a SaaS Application. The slides are available here. The goal of the session was to cut through the "marketing fluff" and look "under the hood" of a multi-tenant application, explaining the different architectural trade offs and implementation best practices (using the Microsoft platform) we gathered by building LitwareHR our sample application. Lee The with EntMag.com covered the session in this article.

Overall, the conference was good. Below some of my thoughts post conference (in no particular order).

  • Great place to meet the "players" in the SaaS space; well at least the providers of SaaS. Enterprises (buyers of SaaS) were not really there. The exhibitors floor was, for me, more interesting than the sessions, I got to meet a lot of very interesting people with great ideas.
  • Multi-tenancy is still glorified to the extreme and used as a symbol of achievement, worse yet, as a marketing tool. I am not sure how long it will take for vendors to understand that multi-tenancy is an internal optimization technique for augmenting customer density, lowering the cost of delivery. As such, no one really cares whether you are multi-tenant or not, they only care about the "lowering the cost of delivery" part (regardless of how you achieve it). Actually, often, being multi-tenant makes the buyer more nervous as it is now collocating data with potential competitors. As I posted almost 1 year ago here, ... IMO the ultimate trick is to be multi-tenant without anybody knowing it, in other words having people experience single tenant behaviors out of a multi-tenant environment, but it seems that people still don't fully get it :)
  • Service delivery platforms are still in their infancy. Even though many exhibitors were offering service delivery capabilities, they are still very "consulting heavy", "ad hoc" in nature and not complete. A "SaaS operating system" (for lack of better words) supporting the entire lifecycle including service creation (dev/test/staging/deploy...), service delivery (ops/monitoring/metering/geo location/disaster recovery...), service monetization (SKUs management/billing/CRM...), service support (call center support/usage monitoring/bug tracking...) and much more  is badly needed. Many SaaS vendors are building their own proprietary solution which is (a) not what most of them want to do; many have told me that they would rather spend their time on vertical, domain specific features (b) is very inefficient as no economy of scale can be achieved. A platform vendor will emerge here and provide these horizontal, underlying capabilities in a much more cost-effective way. Partly illustrated by the diagram below (presented by Eugenio in our SaaSCon session) 

     
    Note that we are working on a paper on this topic, our current plan is to publish it by the end of May.
  • The business aspects of SaaS are now getting quite understood by the "general public"; the architecture of SaaS solutions however and the efficient delivery of them is still for many where the "black magic" happens. I think SaaSCon should move toward a "SaaSTech" where the technology aspects of SaaS are discussed. Keeping a couple of keynote on the state of the SaaS business is fine.
  • Consuming SaaS is not discussed enough. I saw a lot of chest-banging providers (hopefully we were not one of them) :) showing there ware (some very interesting some a bit less), but not many discussed the challenges (or solutions) of having their SaaS solution as part of a larger IT infrastructure. It looks like the SMB market is juicy enough for many not to bother going the "extra mile" and offer solutions that can fit an enterprise scenario. I understand that many vendors are selling 1000s+ seats to large enterprises these days, but based on my understanding these implementations are more a "silo" used by a specific division of a large enterprise than a real capabilities interwoven into the larger enterprise IT. Has anyone connected the opportunity pipeline in a hosted CRM system into a revenue forecasting system sitting on a mainframe (without an army of consultants)? Please contact me if you did, I'd love to learn the details.
  • Also part of consuming SaaS, I would have liked to hear about business continuity plan (in order to avoid this), SLAs, penalties for not meeting them etc.
  • Finally, I was pleased to see Entellium (their exec blog here) describe how important a rich client is, in their core strategy. Too often SaaS is confused with "browser-only" access. Rich client accessing "back-end" services are a very compelling strategy for a SaaS company and of course very compelling for the buyer.

I heard from the organizers that it is very likely that another SaaSCon will happen next year. Count me in! And let's see how many times multi-tenancy will be said then :)