Fawning over Chatter and how SAP missed its chance

Fawning over Chatter and how SAP missed its chance

Summary: Chitter chatter over Salesforce.com Chatter is becoming almost hysterical. Is the hoopla worth the attention or is it a game changer?

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Ever since Salesforce.com announced Chatter, there's been a rising crescendo of what I can only describe as fawning and uncritical waffle. It's worrying.

As I've said before, Chatter is ESME with a few bells and whistles. Yet here we have everyone from Scoble to Mike Krigsman praising this as though it represents the second coming of IT. First up Scoble:

First, lots of people, including most of the Enterprise Irregulars who usually do a bang-up seemed to have missed the real news that Marc Benioff, CEO of Salesforce, announced this week at the TechCrunch Real-Time Crunchup: that Salesforce is going after the whole company, not just the sales people.

Robert - puhlease. I resent that. That's way too simplistic a view. I called Scoble up on a time limited voice connection from the UK using a new SIM card that sucked my $$ faster than a Las Vegas slot machine. We didn't get to complete the call so what I say here is based only in part on that conversation. As I said to Scoble: 'Of course we got it. A year or more ago. And demo'd it in front of around 8,000 developers around the world. It is called ESME and is available as an open source project. I know a lot about that project as I was chief 'handwaver' and advocate both inside and outside the SAP community. So let's be clear - in concept - Chatter is NOT new.

Here's what ESME offers that Chatter doesn't:

  • It's open source. You can play with it, figure if it works for you or discard at zero cost.
  • It was built with scalability in mind. It's based on the Scala/Lift framework. That's what was used to help Twitter solve its problems a year or so ago when the Fail Whale was a common occurrence. Salesforce.com knows that if demand takes off, it has to solve the scaling issue very quickly. It reckons this will be done within a year. I'm suggesting that if they took on board the tenets of how ESME was built, they could do that inside 3-4 months.
  • ESME was built with business process in mind. It was built to demonstrate problem resolution inside day to day business processes. Chatter doesn't address that directly but indirectly. In conversations I had with Salesforce.com execs, they see it as a way to get customers to spend more on SFA or field service/call center apps that Salesforce sells. That's a narrow view and not aligned with the broader view pundits are ascribing to the service.

In comments to Scoble's post, Mike Krigsman punts the hush, hush, wink, wink idea that Salesforce.com already knows this could go deep into the enterprise. At one level he is absolutely correct. Yet SFdC handles a sliver of enterprise process capability:

The significance of Chatter is validating social computing in the enterprise, which you addressed in the comment from Jive's CEO. Those who think Chatter is a trivial Twitter clone are short-sighted in their view. Based on off-the-record discussion with senior execs in a position to know, I can assure you that what we see today in Chatter is merely the tip of the iceberg. Social computing now has the strategic backing from one of the enterprise software heavyweights. That's significant. By the way, if anyone doubts Salesforce's commitment to Chatter, look no further than the the fact it is a new "force" platform module. That's their bedrock platform.

[My emphasis added.]

Mike - this was validated a year ago. Admittedly it was early but it absolutely was validated by SAP and its immediate supporters at very large enterprises. Mike sat in on the same meetings I videod with Salesforce.com co-founder Parker Harris and (not videod) conversation with Brett Queener. Where is that over arching vision which he claims? Instead and including discussions with Steve Fisher who has to make this stuff work, I didn't hear any of that hyperbole. Instead, I saw a measured acceptance that Salesforce has much to do before it can aspire to the predictions being made.

Herein lies the danger. Salesforce.com may well have its hands on something of real value. The fact it is giving it away for existing users tells me it sees long term value in the embedding to the Force.com platform. But...it has to monetize along the way because in Benioff's words - this the next SFdC billion dollar opportunity. How?

When you parse that thought stream against business process you then need to examine what SFdC owns. The platform + SFS + field service + call center. Good though that is, it is a fraction of what makes a business tick or that which delivers breakthrough value unless you believe that sales based functions are at the forefront of delivered business value. I question that at multiple levels. Here's one to get you going: Sun owns Java. Money shot?

Couple that with the acknowledged fact SFdC is wrestling with managing and filtering the noise v value clutter in the real time stream (which ESME arguably solved early on albeit at a rudimentary but workable level) and you can see this represents a big set of technical problems. To its credit, Salesforce.com acknowledges those issues and knows it doesn't have a good answer. Today. That I respect. What I don't respect are pundits writing strategy for the company by proxy when they have little understanding of the technical impediments.

So - before all the handwavers go declaring victory think this: Salesforce.com is a credible and major SaaS vendor. It is NOT a credible enterprise process vendor. At least not yet and doesn't have a declred roadmap to get there under its monetizable ownership. It doesn't own all the process steps where something like Chatter will deliver value yet owns the platform that allows these services to emerge.

Back to SAP. It had the chance to take ESME and make its own almost from the get go. It was built with Netweaver integration in mind. It had/has the potential to reach millions of users - today. So here's the real difference.

Salesforce.com is brilliant at timing and packaging. For all the dopey naming of Chatter, Salesforce.com has the immediate mindshare that SAP could have owned a year or more ago. Does SAP get a second shot? Of course because ESME could be embedded in a matter of weeks/months while Salesforce.com tries to figure how it scales. SAP has millions of captive users where Salesforce has a fraction and more importantly, has only a tiny part of the total process view.

In the meantime - I invite readers to watch the video I recorded of Enterprise Advocates colleague Ray Wang speaking to SAP users earlier today in the UK. It puts much of this into perspective. (see top of post.)

Finally - and to repeat - I didn't get to finish the conversation with Scoble. I trust this post will help flesh out where I am coming from on this important discussion.

UPDATE: Scoble was kind enough to respond in comments, concentrating on the pricing issue. That's OK but doesn't address what enterprise will do - free or not. That's why process in this discussion is so important. It's way beyond what he calls 'features.'

Topic: Enterprise Software

Dennis Howlett

About Dennis Howlett

Dennis Howlett is a 40 year veteran in enterprise IT, working with companies large and small across many industries. He endeavors to inform buyers in a no-nonsense manner and spares no vendor that comes under his microscope.

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8 comments
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  • What Salesforce did was pricing, not features...

    What I was talking about that most people
    missed wasn't the feature set. Of course that
    isn't new. Even Benioff pretty much admits he
    stole the idea from Facebook and Twitter.

    But at the Techcrunch Real Time Crunchup on
    Friday Benioff said Salesforce was working on
    several versions of Chatter, including a free
    version. THAT is HUGE news and changes the
    whole marketplace.

    Now, we'll have to wait to see what he really
    delivers as free, and what he charges $50 a
    seat for, while companies like Jive have
    shipping versions today that are very robust
    and cost a fraction of the $50-per-seat charge
    that Salesforce goes for, but clearly they will
    have to react and it's also clear that Benioff
    is going after Microsoft with this new pricing
    structure.

    Anyway, you really should watch the video from
    the TechCrunch RealTime Crunchup. That's where
    the real news was announced.
    Scobleizer
    • Thanks Robert but....

      Thanks Robert for the considered response. I think you'll agree that the pricing has yet to work itself through and reality is likely to dictate that it goes to 'free' pretty quickly. That makes Chatter (Twitter/Yammer etc) a commodity feature which is the way enterprise observers have always looked at this style of service. The difference I think is that Benioff played a marketing master stroke where SAP shrugged its shoulders. Let's revisit in a year and see who's correct?
      dahowlett
  • So, what's new?

    SAP always shrugs their shoulders and someone else steals their thunder... what's new?

    best knowledge management team in the industry, by far, and no one knows about it

    open integration to just about everything with bytes on it (before netweaver) - never saw the light of day commercially

    the point is that SFDC capitalized on it -- and that it is not part of the platform. That is the huge point (which many folks, including myself and Paul Greenberg) have made. It it not chatter or the features, it is the platform that matters.

    As for SFDC being enterprise - agree 100%. Alas, the demo from Vetrazzo was pretty incredible in that in 3 months they built an entire SAP-replacement solution using Force.com. Yes, only one -- but the other demos were hinting in the same direction.

    Again, it is the Cloud, the platform and infrastructure that matters. What's that? Yes, it is proprietary language and setup... count how many Vetrazzo's care about that...

    I think you are making some good points on not being innovative, but you have to give them points for getting it running before anyone else. As for open source - last I recall the Client-Server revolution was won by a company that was far from open or used standards -- right? And we moved on from there?

    I think that the innovation argument is trumped by the unbearable lighting of being.

    just my thoughts, and you can now tell me why I am wrong.
    Esteban.Kolsky
  • RE: Fawning over Chatter and how SAP missed its chance

    Dennis, good points about ESME. However, the big difference between anything that has come before it and Chatter is that it is embedded in the platform. Every app that has ever been written on Force, e.g., Financial Force, our PS Enterprise, and thousands of others are all automatically chatterized. This is unprecedented in the on-premise world. More at http://www.appirio.com/blog
    BNara
  • RE: Fawning over Chatter and how SAP missed its chance

    How about looking at the basic problem here, which is the whole social media concept -- not which implementation of it is better. Do you really want workers so "socially connected" that they never leave their offices and meet a real person? This is a question of values, not solutions.
    Vesicant
    • never leave the office?

      i cannot even imagine how providing a social connection to an employee will anchor them to their desk. sales people have said for -- well, close to forever -- that they would never replace face-2-face with social tools, so i cannot possible imagine how giving an employee a tool to more efficiently and effectively connect with customers can be a bad thing.

      what am i missing?

      there is no implied evil in social tools, just a better way to connect both internally and externally.
      Esteban.Kolsky
  • ESME and business processes

    "ESME was built with business process in mind."

    Can you elaborate on this statement. Having seen ESME demoed a couple of times (including at Teched last year) I still don't get that part - nor why any number of micro-blogging tools that target the enterprise (yammer, cubetree etc.) would not be just as good as ESME. Ok - ESME is opensource and it's free. You say it's more scalable cause it uses scala/lift (but actually scalability has little to do with language or what you use for the presentation tier - it is an architectural issue - something the twitter guys never quite got). But anyway - I'm still trying to figure out what the SAP "hook" is here - apart from the fact that it was started by some people in the SAP community.
    mspork
    • ESME doesn't hold a candle to Chatter

      Dear Mr. Howlett,

      What part of ESME did you build? Don't you think you are a little biased on this? I've seen ESME and I've seen Chatter, and ESME doesn't hold a candle to Chatter.

      As to your points above, open source is not a benefit. To imply that you or the ESME team know scalability but that Salesforce.com does not is not only the kind of hubris for which you are well known, but it is also totally and completely preposterous.

      Why does ZDNet allow this pompous blowhard to spout here, constantly insulting other ZDNet journalists with far more credibility and humility than he exhibits?
      MannyRamirez