Enterprise Cloud Computing
Multitenancy: The Next Cloud Computing Wave?
Total cost of ownership will be the driver
By: Allan Siegert
May. 28, 2010 07:15 AM
Navatar Group, a cloud service provider, is openly attacking the vestiges of the on-premise software model. Navatar just announced that it will provide all implementation and support services for financial firms interested in salesforce.com, for free.
Navatar's announcement is promises to start a new trend among cloud product providers - free services. This is bad news for legacy software vendors who earn millions of dollars from implementation, maintenance and support fees. Those days of charging all these fees, just to keep things running, may be over soon.
However, this is great news for customers who are quickly becoming accustomed to the Consumer Cloud, which is frankly setting the expectation that Cloud services are immediately available without implementation effort. Can you imagine downloading an app for your Blackberry or iPhone and being asked to pay for implementation services or to fix a problem? Isn't the Cloud supposed to deliver better TCO and faster time-to-market without all the typical hassles that make the on-premise model such a headache?
Cloud services are subscription based and the expectation is that start-up and support costs will be built into the service fees or eaten by the vender. Coming back to Navatar's announcement, companies can buy pre-built cloud solutions for Asset Management and Capital Markets, built on salesforce.com's cloud platform. Those firms can start service in 48 hours and all implementation and training for free. In fact, customers will not have to pay for any ongoing maintenance or support either and they will be able to get upgrades seamlessly at no additional cost. Which is exactly how the cloud model is supposed to work.
Does that mean there will never be any customization needed? Not at all. There are certainly times when it's necessary to adapt a pre-built product to a firm's unique needs and those are the only instances where customers may have to pay for services. But in most cases, firms don't have to do that.
Going back to the cloud model for a moment, for those of you who might be interested, free services are possible thanks to multitenancy. Which is a fancy way of saying that everyone benefits from common services (so instead of hiring your own personal doorman, the costs are spread across all the apartment building's tenants). With a multitenant architecture, a cloud provider is able to minimize the infrastructure and labor costs as well as spread them across all customers with similar needs. The customer is the winner since this significantly reduces the total cost of ownership.
TCO will be the driver for the next wave of cloud computing. Navatar has made the first move on the business-to-business side. We will see other cloud vendors move in that direction as the Consumer Cloud sales show the way.
Reader Feedback: Page 1 of 1
SOA World Latest Stories
Subscribe to the World's Most Powerful Newsletters
Subscribe to Our Rss Feeds & Get Your SYS-CON News Live!
SYS-CON Featured Whitepapers
Most Read This Week