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Software as a Service (SaaS) Strategies for Hosting Providers Douglas Johnson, SWsoft Steve Merkel, Data393 Tuesday, May 8, 2007
What is SaaS? Application 1 Customer Site Server Client PC Traditional Deployment Application 1 Hosting Provider Site Server Internet SaaS Deployment Server Application ,[object Object],[object Object],[object Object],[object Object],Software deployed as a hosted service and accessed over the Internet
SaaS – The Opportunity* ,[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],* Gartner Release, September 2006 SaaS % of Business Software Market opportunity: $8B increasing to $40B
SaaS – The Track to Higher Revenue Customer Needs  Domain Registration $1-$3 Shared Static Web Hosting $3-$10 Shared Dynamic Web , DB, Apps $5-$20 Virtual Private Servers $15-$100 Dedicated & Managed Server $100-$500 Business-Class E-mail (i.e. Hosted Exchange) $150-$300 Add Business Collaboration (i.e. SharePoint, LCS, VoIP) $200-$500 Advanced Apps (CRM, ERP, vertical) $250-$1500+ Infrastructure SaaS Web Presence Email E-commerce Collaboration Application Mgmt Revenue Opportunity (SMB: 20 Users/Month) $10 $100 $1,000
SaaS – The Benefits ,[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object]
SaaS – Applications Most software (including IIS/Apache) can be installed or hosted ,[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object]
Hosted Application Opportunity …  ,[object Object],[object Object],[object Object]
Hosted Application Opportunity …  ,[object Object],[object Object],[object Object]
Hosting Requirements for SaaS ,[object Object],[object Object],[object Object],Traditional Hosting ,[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],Software as a Service
Reducing SaaS Costs ,[object Object],[object Object],[object Object],[object Object],[object Object],Traditional Configurable Multi-Tenant SaaS Deployment Types Note Converting traditional applications to multi-tenant applications is more expensive than virtualizing. Virtualization effect Automation effect
SaaS – SWsoft Delivers Solutions ,[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],SWsoft Delivers ,[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object]
SaaS Application Type – Multi-Instance (Configurable) ,[object Object],Application  Repository Hosting Provider Site Customer Web Directories Application Repository Web Application Web Application Web Application User 1 Directory User n Directory … Web Application Web Application External Application Site Web Application Web Application ,[object Object],[object Object],[object Object],[object Object],[object Object],PEM Management Node Internet Customer 1 Customer 2 Customer n …
Demo – SWsoft Delivers Web Applications ,[object Object],[object Object],[object Object],[object Object]
SaaS Application Type – Multi-Tenant ,[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],Storage Area Network Hosting Provider Site Customer Configuration Application Server Application 1 User 1 Directory User x Directory … Application Storage PEM Management Node Internet Customer 1 Application n … C1 Storage Config 1 Config n Config x Cx Storage Customer 2 Customer n …
Example: Multi-Tenant Architecture  ,[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object]
Hardware Costs ,[object Object],$57,500.00    11 Total         $20,000.00  $20,000.00  1 SAN $5,468.00  $2,734.00  2 DNS Servers $3,908.00  $3,908.00  1 PEM Business Support System $3,908.00  $3,908.00  1 PEM Operations Support System $7,776.00  $3,888.00  2 Exchange Back End Servers $6,336.00  $3,168.00  2 Exchange Front End Servers $3,768.00  $3,768.00  1 Microsoft Provisioning Server $6,336.00  $3,168.00  2 Active Directory Servers Total Price Unit Price Quantity Server Type Architecture - 11 servers + SAN ~5,000 users
SaaS Application Type – Single Instance (Traditional) ,[object Object],[object Object],[object Object],[object Object],[object Object],Hosting Provider Site Application Server PEM Management Node Application VE1 VE 2 VE n Application 1 Instance 1 Application 1 Instance 2 Automated provisioning and maintenance End User Customers Service Provider Provision application Phone call Website transaction
Case Study Data393 is a premier provider of Managed Infrastructure Solutions, that owns and operates its own state-of-the-art data center in Englewood Colorado.  Case Background: Colocation Dedicated Hosting ,[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],Managed Services ,[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object]
Case Study – The Problem Data Protection: Using EMC’s Avamar backup software, Data393 provides a super efficient, and highly reliable off-device backup service to servers located within the data center, or at any remote site that has some type of Internet connectivity.  The Problem: We needed a way to bill our customers for their overages, and provide their different ‘users’ with meaningful notifications based on their role within the company. Known Issues: ,[object Object],Our Solution: Billing And Customer Online Notification Engine
Case Study
Case Study – The Analysis Realization:  Although we had built in some features to enable us to have a reseller program, we quickly saw that resellers (and large enterprises) would want direct access to the tool so they could tweak settings/pricing/notifications often.  Required Considerations: ,[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],Possible Solutions: ,[object Object],[object Object],[object Object]
Case Study – The Solution We have chosen to deploy an instance of the software for each customer within a Virtuozzo virtual environment.  Immediate Benefits: ,[object Object],[object Object],[object Object],[object Object]
Case Study – The Wrap Up Observations: ,[object Object],[object Object],[object Object]
Sample Product Offerings for Traditional Applications Option 1 (provide VE and deploy applications) Option 2 (provide applications with environment) Step 1: Server Environment Silver Server - $49 / month 1GB RAM, 200GB disk space, 200 CPU units Gold Server - $99 / month 2GB RAM, 400GB disk space, 500 CPU units Step 2: Select Applications to Deploy Application 1 - $99 / month Collaboration and more … Application 2 - $149 / month Business process and CRM Application 3 - $499 / month Web conferencing  $340 TOTAL  (per month) $140 1 $140 Application 3 1 enterprise license $150 10 $15 Application 2 2GB traffic per user $50 5 $10 Application 1 100MB disk space per mailbox Total Users Cost Application
SaaS – The SWsoft Platform ,[object Object],[object Object],[object Object],OPEN FUSION Standards Application Format  and Packaging Common Licensing  Models Code Re-Usability Shared Code Base Authentication Single Sign On Standard Update  Process End User Customers ISVs Hosting Providers and Resellers SWsoft PEM Service Plan Management Billing Control Panels (end user, reseller, service provider) Storefront Reseller Module Payment Gateway Interface Domain Registration Interface Business Rules (workflow) Reporting SWsoft Virtuozzo Application Density Application Isolation Quality of Service Parameters Service Portability
SaaS – Barriers to Adoption -- IT manager I will lose my job if we implement SaaS. -- Compliance manager We need to keep our data in our facilities. -- Datacenter manager We already know how to run this application and want to own it. -- Datacenter manager What if the service goes down? ,[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object]
Questions and Answers ,[object Object],[object Object],[object Object],[object Object],[object Object]

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SWsoft Hosting Solutions for SaaS

  • 1. Software as a Service (SaaS) Strategies for Hosting Providers Douglas Johnson, SWsoft Steve Merkel, Data393 Tuesday, May 8, 2007
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  • 4. SaaS – The Track to Higher Revenue Customer Needs Domain Registration $1-$3 Shared Static Web Hosting $3-$10 Shared Dynamic Web , DB, Apps $5-$20 Virtual Private Servers $15-$100 Dedicated & Managed Server $100-$500 Business-Class E-mail (i.e. Hosted Exchange) $150-$300 Add Business Collaboration (i.e. SharePoint, LCS, VoIP) $200-$500 Advanced Apps (CRM, ERP, vertical) $250-$1500+ Infrastructure SaaS Web Presence Email E-commerce Collaboration Application Mgmt Revenue Opportunity (SMB: 20 Users/Month) $10 $100 $1,000
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  • 24. Sample Product Offerings for Traditional Applications Option 1 (provide VE and deploy applications) Option 2 (provide applications with environment) Step 1: Server Environment Silver Server - $49 / month 1GB RAM, 200GB disk space, 200 CPU units Gold Server - $99 / month 2GB RAM, 400GB disk space, 500 CPU units Step 2: Select Applications to Deploy Application 1 - $99 / month Collaboration and more … Application 2 - $149 / month Business process and CRM Application 3 - $499 / month Web conferencing $340 TOTAL (per month) $140 1 $140 Application 3 1 enterprise license $150 10 $15 Application 2 2GB traffic per user $50 5 $10 Application 1 100MB disk space per mailbox Total Users Cost Application
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Notes de l'éditeur

  1. Issues: Authentication Network impact on system performance Data backup Data security
  2. http://www.ebizq.net/news/7314.html for details behind figures
  3. Article http://www.networkcomputing.com/showArticle.jhtml?queryText=&articleID=197700166&pgno=2 provides interesting data. Evaluation can be reduced by two weeks No environment set up No configuration Uptime and availability generally higher 24x7 facilities redundant power / Internet monitoring Reduced maintenance provider assumes responsibilities expertise included in licensing fee Data location centralized – instead of dispersed on PCs and servers in different subsidiaries
  4. note the difference between hosted infrastructure and hosted applications note the difference between applications developed for SaaS and those developed for stand-alone environments
  5. Service provisioning . Providers need to integrate new services into their infrastructure very quickly – as soon as users request them. Users need to be able to get access to the services as quickly as possible. Fast and fully automated service provisioning is the key factor. Self-service . Users want to be in control. Hence, users need an interface (API and control panel) for managing service properties within their domain of expertise and infrastructural properties that are safe to change within the SLA. Service integration . Once a user has multiple services and applications, it is critical that the services have some consistency among each other. In particular, SSO (Single Sign-On) and UI integration (language locale, color scheme). Licensing . Along with separation of responsibilities comes separation of costs. Users, admins and developers act as independent entities and they need to know who uses what, how much and for how long. Billing . Providers need to be able to charge for individual services as well as for combination of services, provide promotions, volume discounts and so on. All of this requires a comprehensive billing system. Multi-tenancy . Currently, most applications, middleware and business frameworks (with the exception of data base servers) either don’t support multiple application instances on a single server at all, or require complex configuration. For quite a while, virtualization will be the only technology that enables multiple instances per server without redesigning applications and middleware. Efficiency of the virtualization infrastructure – ability to maximize density (to minimize hardware and power cost) without increasing management costs (to mitigate sprawl of OS, middleware and application instances) – is critically important to enable SaaS. Agile infrastructure . The key to efficient SaaS infrastructure is to allow a service or an application to run at any desired level of service – from the most affordable to the highest mission-critical – without tweaking either application or the infrastructure. SaaS infrastructure needs to be able to provide operational capabilities – high availability, distributed load-balancing, zero maintenance downtime, precise resource accounting and management, fault tolerance – to any application. Again, Virtualization is the enabling technology. By intercepting interaction between service and hardware, virtualization allows to implement a lot of high-end infrastructure services w/o any support from the application whatsoever. Service migration . Users want the flexibility to change hosting facilities, service plans, and hosting providers with little effort. Such migration requires an ability to take services of a user/tenant and move them to a different environment or infrastructure.
  6. Virtualization effect: note that the effect is greater with traditional applications than it is for multi-tenant applications Automation effect: note that the effect is the same for all applications -
  7. PEM and Plesk meet the automation requirements and self-service requirements of hosting providers Plesk supports Shared Hosting and web applications PEM supports all applications including hosted Exchange and SharePoint OPEN FUSION provides standards so ISVs can deliver web-applications to hosting providers PEM and HSPcomplete provide automated billing services Virtuozzo provides an isolated environment so that non-multi-tenant applications can be managed by PEM
  8. SWsoft Hosting Platform – designed to bring Hosting Companies, ISVs, and End Users together OPEN FUSION provides the standards base to connect ISVs and Hosting Providers Virtuozzo provides a flexible and manageable infrastructure for hosting applications Provides higher density for traditional (non-multi-tenant) applications Provides QoS parameters and application isolation for applications sharing the same physical hardware Provides service portability and an upgrade/downgrade path PEM delivers management and automation tools Automated ordering and provisioning Integrated domain registration and pament processing Business logic and workflow Billing and fraud control Control panels for 24x7 customer self-service