Office 2.0: The future of applications

The application as we have known it is being redefined. During the Office 2.0 Conference, a panel of software vendors discussed the future of application and rise of Web-based applications with collaboration at the core.

The panelists included Mark Bagley, vice president of technology at British Telecom (BT); Danny Kolke, CEO of Etelos; Greg Olsen, CTO at Coghead; Ramana Rao, CEO of stealth startup iCurrent; Rajen Sheth, product manager, Google Apps; and Frank Zamani, CEO of Caspio. The moderator was Greg Ruff, principal of White Space Strategy.

Sheth said that two major factors are driving the redefinition of applications. "People are connected from anywhere, which drives several types of scenarios. People are more distributed and operate on more devices. There is an increase in the velocity of communications. Secondly, the deployment model is more iterative."

He also noted that previous generations of applications didn't focus as much on users. "IT software was typically sold by negotiation between vendors and IT and then pushed out to users. With rapid collaboration, users are becoming more important."

Google is trying to change the equation with its Google Apps, a $50-per-user-per-year suite aimed at businesses. And, Google, among others, has shown how iterative development--the almost perpetual beta built to scale across millions of users--is becoming the norm for less mission critical applications.

"Product lifecycles are accelerating. If it takes 18 months to map out a product and deploy it, how much of the user expectation will be relevant? Smaller companies can compete at a much faster pace," said Kolke.

"The rules are being redefined and companies are trying to figure out how to deal with it," Zamani said.

"We used to take nine months to go to market and now it's four weeks. What used to cost $2 million to deploy is now nothing," said BT's Bagley. The company doesn't have to spend on money on delivering packaged software or marketing, he explained.

Rao, who spent was the CTO and founder of Inxight Software and spent ten years at Xerox PARC, talked about applications becoming more invisible, like phone communications--you can pick up any phone and connect with any other phone. "Slowly we will get to productivity applications," Rao predicted, "but the platforms are not moving forward as fast as everybody says."

A choice of word processor or contact manager shouldn't prevent you from seamlessly communicating and sharing with other applications, but today you can't easily cut-and-paste or share among Web 2.0 applications, user interfaces are all over the map and each requires a unique log in.

Initiatives like OpenSAM (Open Simple Ajax Mashups) and OpenID are tackling some of those issues. OpenSAM provides a set of recommendations and frameworks for integrating SaaS applications and OpenID provides single-sign on across applications.

OpenSAM, founded by ShareMethods and iNetWord, allows Web 2.0 applications from different vendors to launch each other and share task and contextual information. For example ShareMethods' ShareOffice ties together a number of OpenSAM-compliant applications from different vendors into an integrated, collaborative suite.

Eric Hoffert, CEO of ShareMethods, said that OpenSAM will extend beyond connecting applications to connecting applications to content and people to applications, and ultimately to people to people.

It's unclear whether OpenSAM will be able to bring Google or Microsoft into the fold or whether the Web 2.0 software vendors using frameworks like Open SAM will gain enough clout to slow down the incumbents. "We are in a transition and trying to predict what the next equilibrium might be. Google, Yahoo and Microsoft will be there, and there is a fighting chance there will be an unaligned group," Rao said. The "unaligned group" would be bound together by OpenSAM, OpenID, open source and other standards or integration technologies.

The compelling case for the unaligned will be more flexibility in the choice of applications and services--the capability the create mashup or composite application by drag and drop--and lower cost.

"The idea that application selection and deployment by IT group that live behind firewall is what is dying. The boundaries of personal and company apps is on its way out," said Coghead's Olsen. Coghead offers a custom Web application development service, and just signed a deal that will give Coghead developers access to BT's telephony services for their applications.

Walking through the exhibit area of 70 Web 2.0/Office 2.0 companies, you see a lot of similar applications, variations on a collaborative communication and task management theme. Most of the companies will not survive, and the notion that the incumbents will roll over and die, be overwhelmed by the thundering heard of 2.0 startups, is not credible.

It's convenient for Coghead to say that companies will let thousands of flowers bloom across an enterprise to solve discrete problems, but at some point abundance of simpler, Web 2.0 applications turns into a nightmare. IT will continue to have a key role in managing more centralized functions, such as core ERP, compliance , security, widget overflow and other areas.

Kolke said the "big companies are doing everything they can to screw up," and that the "economics of innovation" is coming down. But Microsoft, for example, is not feeling any pain from upstarts at this point, with one major exception--the ten-year-old Google. Microsoft can screw up a lot with its applications strategy before it becomes critical, and the company has a history of fighting back with great persistence.

In the end, battle is over accumulation of developers and users. Right now Microsoft has a strong position and a platform that allows developers to make money. Salesforce.com is making progress with its hosted developer platform and WebEx/Cisco is embarking on a similar an effort. Google is establishing its platform, but hasn't really opened it up much beyond mashups, and Facebook is moving fast as a platform attracting developers. Right now most of the applications are consumery, but that will change over time.

"We are no doubt in a transition," Rao said. "The issue isn't whether small companies beat up on MS or Oracle--they aren't going away. The question is who ends up with control." Indeed, whether Web 1.0, 2.0 or 3.0 or mainframe or client/server or Windows or Linux, the players want to control the board, which means getting more developers and users than their competitors. Some things never change and new, fleet players will swoop in and take some control while the incumbents try to hang on and adapt to the new world.