SAP's gridless on-demand model

SAP has done its on-demand rivals two great favors today. Not only has it endorsed the on-demand model, it has simultaneously flunked it.
Written by Phil Wainewright, Contributor

SAP has done its on-demand rivals two great favors today. Not only has it endorsed the on-demand model, it has simultaneously flunked it.

I had been hoping SAP would confound its critics and come up with something daring and innovative in today's launch of its on-demand CRM offering. But the best it could do was 'isolated tenancy'. Not good enough, I'm afraid.

It would be OK if SAP's kindergarten-classIt's all a load of old SoSaaS analysis of where other on-demand models stand today bore any relationship to reality. But like any vendor that doesn't have a proper answer to its competition, the true purpose of SAP's slideware is to make its proposition sound plausible enough to evade deeper scrutiny.

SAP portrays multitenant systems as monolithic giants where every customer shares a single database, application server and hardware platform. I wonder, has no one at SAP stumbled across the notion of server virtualization in the past five years?

You'd think hosting partner IBM, of all people, would have been eager to point out the benefits of applying grid technology in the data center. But no, if SAP believes the next generation of service provider data centers means pushing an identical application image out to a seperate server and DB2 instance for every individual end customer, who is IBM to try and argue with SAP's gridless vision of on demand?

No wonder SAP isn't interested in customers with fewer than a hundred CRM users. That's probably its break-even point, after taking account of those infrastructure costs.

SAP did try to sound vaguely up-to-date with today's best practice in the on-demand world. It supports custom tabs, for example, which means at least some elements of the application are configurable by individual customers. But the huge flaw in SAP's on-demand vision is the notion that any customer that wants to move on from the cookie-cutter application image that's being expensively hosted on its own personal 'isolated tenancy' is going to want an on-premises implementation.

SAP executive board member Shai Agassi of course presented this as an advantage at today's launch:

"There's no other on-demand environment," said Agassi, "that allows you to take your instance, put it on site, and return to development."

That's not an advantage, it's a cop-out (as we Brits say). And of course it reflects the classic innovator's dilemma that SAP finds itself in. If it really wanted to deliver all of the customization capabilities that customers actually want, it would build them into the configuration options of its on-demand offering. But doing that would undermine its bread-and-butter on-premises offering. So it has to come up with its slideware about 'isolated tenancy' instead.

Just as I'd feared, it's all a load of old SoSaaS.

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