Provisioning Software as a Service (Salesforce.com/Gartner)

Findings From the 'All Software' Research Meeting:
Provisioning Software as a Service
by Jeff Comport
Gartner, Inc.

Recently, salesforce.com raised the bar for the software-as-a-service model by moving beyond the locked-down functionality historically associated with subscription software providers and offering flexible, tool-oriented, multitenancy applications for sales and other CRM-oriented functions.

ANALYSIS
The recently announced salesforce.com AppExchange partner program enables ISVs to publish their applications using a software-as-a-service (SaaS) model and salesforce.com's infrastructure and tools (a platform lock-in), accessed via a Web front end. The leverage and profitability lie in salesforce.com's architecture and infrastructure delivery framework, a single database, a multitenant host for all customer data, data model variations, and business functionality customization. The tenant-by-tenant variability of both data model and process is achieved through high virtualization, down to a virtual data management service that "floats" above physical DBMS tables. The challenge will be to preserve the leverage of multitenancy as more diverse applications (such as non-CRM) demand high processing power for virtualization layers, possibly requiring a "box" per partner, similar to one-off hosted application models (like ASPs). We'll see a rise in these platforms and exchanges from many sources: Yahoo, Google, Visa, eBay and others (which are offering business function "segments" like shopping carts and credit verification). They will change the way software is built and deployed. Indeed, we expect that the eBay-Skype combination will ultimately produce "network aware" applications (for collaboration) that can be procured over the net, as required. A key challenge for successful delivery of SaaS, however, will be balancing flexibility with the necessary scale and leverage to maintain a robust infrastructure (such as secure separation of rules, definitions and business data in a multitenant business model).

Bottom Line: Users should begin investigating and testing SaaS providers for specific, well-defined business tasks that can be integrated into larger business services.

(This research has been independently produced by Gartner research analysts without any review of or participation by any member of Gartner's board of directors, including Maynard Webb, who serves on Gartner's board of directors and is the chief operating officer of eBay Inc.)

Gartner Research G00131696, 29 September 2005.