Over the past few days, a couple of blog posts have addressed the issue of reliability of Web-based applications. John C. Dvorak of PC Magazine cited the example of Windows Genuine Advantage's weekend outage in which Microsoft's WGA server was out for 19 hours this past weekend, and Dvorak drew the conclusion, "All this proves is that these Web-based applications cannot be trusted." Dvorak also discussed the threat to software-as-a-service in that server outages would cause massive downtime to a large number of users.

Matt Asay, of CNET's Open Road Blog, commented on Dvorak's post saying that customers in the SaaS world are 100% helpless if something goes wrong, because they don't have the code and don't have IT staff who can go in to troubleshoot the outage--meaning companies are completely reliant on the vendor. But then, TalkBack posters cried FUD and pointed out that outage risks could be managed and the real concerns of SaaS were security and IP.

What do you think about SaaS security? Send your thoughts for potential consideration for a future SaaS Week article.

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In a two-part series, CRMBuyer's Erika Morphy reported on best practices for companies considering a SaaS implementation. Starting with a needs assessment and close look at the market is best, obviously, but then in part two of the article she looked beyond implementation to how to keep on top of the marketplace and the different options offered by SaaS.

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The buzz around SAP's A1S product is increasing. Reportedly, the product will use the SaaS model for ERP and CRM applications with SMBs being the target. Reportedly, SAP is set to unveil A1S on September 19, a move that is being closely watched around the Web. Will SAP's gamble pay off? Opinions vary.

Summing up a lot of what seems to be the general consensus that SAP's move is a gamble, Internetnews.com's Larry Barrett a few weeks ago reported on an interview with Gartner analyst Dan Sholler in which Sholler commented, "No one has ever proven they can sell this type of business technology this way. SAP is betting the profitability of the company that it will be able to do it."

And if eWeek's Renee Boucher Ferguson is stating correct figures, betting the profitability may not be a stretch, as she reports that SAP has spent somewhere between $414 and $552 million over eight quarters on developing A1S, and that SAP may be planning A1S as the future replacement suite for its former flagship product R/3.

Time will tell what happens with the release, but some of the target customers may not be terribly interested, according to a Forrester Research report about whichSearchSAP.com's Jon Franke wrote saying that 60% of SMBs in its survey were "not at all interested" in SaaS for ERP and preferred on-premise products.

We shall see if they are more or less interested after September 19.

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Framingham, Mass.-based CoreBlox calls itself "the pioneer in Channel Management Solutions." The company's core offering is products and services that use the software-as-a-service approach to offer a platform for support across the channel. To get an idea of how this works in reality, CoreBlox's CEO Todd Clayton recently answered some questions for SaaSWeek.com.

1) What is CoreBlox and how does it work?

The CoreBlox on-demand solution streamlines the customer support process for organizations to more efficiently service their own and their channel partners' acustomers. CoreBlox includes search, navigation, knowledge management and web-based ticket management modules. The CoreBlox SaaS solution is composed of a flexible and modular application integration framework based on an open source platform, Plone. Seamless integration is provided in the CoreBlox enterprise version for salesforce.com CRM as well as Angel.com IVR for phone support. Other complimentary systems, such as ERP, ESD and ESL, and PRM could also be plugged into the CoreBlox system.

2) In 75 words or less, please outline why a company should be interested in CoreBlox.

CoreBlox offers a way to reduce costs and increase customer satisfaction within your support ecosystem. Support organizations automate case management for both direct and channel customers. They create a global knowledge base, make the latest files, patches and documentation available for download, and delegate user management to the channel. Resellers find their self-branded CoreBlox site eases the service process, including one-click issue escalation. Customers leverage self-service features and overall, experience quicker resolution times.

3) What's the learning curve like for CoreBlox? Do people typically need a lot of training to use it?

CoreBlox doesn't usually require much training. Customers will find the Product Tour on our site helpful while orientating to the CoreBlox user interface and functionality. We provide assistance via e-mail for
Free version users or through our customer support web site and telephone for Enterprise users.

4) What are they key differences between the free version and the paid version of CoreBlox?

The Free version of CoreBlox is targeted at small and medium sized enterprises, as it is free for up to 10 internal (and unlimited external) users. With this plan you also get 100 Mb server storage space and email access to CoreBlox support.

CoreBlox also offers a 30-day trial for larger organizations to try the Enterprise plan for free. The Enterprise plan includes up to 10 internal and unlimited external users at no charge, then costs $50/month/user for additional users with volume discounts available. Included at that user price is server storage space up to 10 GB, SSL support, customizable site URL as well as access to CoreBlox support via email, phone and website. With the enterprise version you can also receive salesforce.com CRM integration at an additional cost.

5) Can you offer a brief example of a real-world use of CoreBlox and the benefits it brought the company?

Let's look at two scenarios; a business providing direct support to customers and a business using channels to sell and service its product.

In the first scenario, a small Atlanta-based medical instruments company (Med Inc.) has 8 employees in its support organization who provides direct support to customers. By using CoreBlox, Med Inc. can quickly automate their case management process. Branding their CoreBlox site with Med Inc.'s logo, images and custom color scheme, means the customer experience is personalized. When a customer calls with a problem, a convenient one-click process allows for the creation of new support cases and the ability to assign the case to the author or someone else. The support team can then also manage support cases from a single queue, filter support cases to determine how many cases are in each stage of the resolution process and link solutions to ensure consistent case resolution is delivered to the customer. Delegated user management enables customers to manage their own login and access rights. A global knowledgebase promotes customer self service and ensures consistent quality of information across the support organization.

Secondly, let's use the example of a NY-based computer manufacturer (Computers Inc.) with 10 channel partners. Computers Inc. sells its products solely through its channel, and partners are tasked with providing front-line support for any issues or requests that come in from the end customers. In this scenario, both the reseller and Computers Inc experience all the benefits described in scenario one above. In the event a reseller is unable to resolve a customer's issue, they are instructed to escalate the issue to the attention of Computers Inc. for follow-up.

Offloading front-line support to resellers can be a great benefit to Computers Inc. This way the Computers Inc. support team can steer clear of the most common support issues and focus on complex problems that require their expertise. However, in a non-CoreBlox enabled environment this can be a tricky scenario to manage for several reasons:

1. Typically each reseller has its own support system for managing interactions with customers. In our experience this is some combination of paper, e-mails, and spreadsheets. Not only are these methods scattered and inefficient, there is also no integration with Computer Inc's support system. This translates into a lack of visibility into what kind of problems these resellers are handling, and a bottleneck in the escalation process should one be necessary.
2. The lack of integration makes it difficult to disseminate the critical product knowledge that both educates resellers and enables customers to perform self-help.
3. The overhead of being asked to provide support without the proper tools and information slows the resellers down and takes the focus off their most important purpose: selling.

CoreBlox helps Computers Inc. to create a powerful and efficient partner support channel. With our solution, Computers Inc. can:

1. Give each of its 10 resellers their own unique, branded support site
2. Seamlessly populate each reseller's site with useful knowledge about their products and services (the knowledge is fully searchable and easy to navigate)
3. Gain visibility into all the support interactions between resellers and customers, regardless of whether they become escalated
4. Receive support escalations that automatically contain the entire history of interactions between the reseller and the customer
5. Reap the financial rewards of providing resellers with all the tools they need to provide excellent customer support, shifting the focus back to selling

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In Computer Dealer News, reporter Paolo Del Nibletto comments on Microsoft's newly announced hybrid SaaS business model, which it calls "Software+Services." The initiative is a channel partner program based on three delivery models: on-premise, hosted by partners, or hosted by Microsoft. The company calls the initiative ambitious and in response to Google, which offers a number of all online services, but CDN reports also that Microsoft's partners have told the company that they are not terribly interested in the Software+Services approach. Read more.

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IBM yesterday announced its plans to purchase SaaS Web conferencing vendor WebDialogs. According to Clint Boulton of eWeek Channel Insider, the move is evidence of how large high-tech enterprises and startups are both vying for a chunk of the online collaboration software market, which Boulton suggests could be worth billions. IBM plans to bundle WebDialogs' technology with its Lotus Sametime assets in an offering called Lotus Sametime Unite, which could mean IBM will try to boost its standing in unified communications against Microsoft and Cisco Systems. Boulton delves further into the promise of the Web collaboration market and how startups are also vying for their share of the business. Read more.

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In a press release yesterday, information security company ComSec Inc. announced it had released a free "heatmap" that allows companies to graphically evaluate security of numerous SaaS vendors. Obviously security is a key concern for any organization considering a software-as-a-service solution, so data about security could be valuable information. The catch, of course, for accessing the heatmap is that you must offer up your details to be added to ComSec's marketing database before you can download it -- but interested readers can request it on ComSec's website.

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On Monday Business Objects and Thomson Financial announced they would partner to offer customers packaged information about markets that is ready for analysis upon delivery. Thomson Finacial president Matthew Burkley had this to say in the press release:

The relationship we are building with Business Objects will give us the unique ability to deliver our best-in-class financial data in a powerful, secure, easy-to-use model. Now, companies will be able to easily and flexibly link their decisions to outside market factors, giving them a real advantage.

InfoWorld reported on the announcement with comments from Liz Herbert, a senior analyst with Forrester, who called the announcement a sign of convergence of SaaS with industry-specific applications.

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The big news in the SaaS space today was Walnut Creek, Calif.-based Workday Inc.'s release of the beta of Workday Financials. The company calls this the first on-demand alternative to ERP and an entirely new model for helping companies to perform ERP functions while also measuring business performance. The particularly interesting aspect of Workday is it's promise to do this all on-demand with the SaaS model, requiring no hardware, installation, upgrades, et cetera. In the press release, Workday president Aneel Bhusri had this to say:

Workday is bringing together the lower cost of ownership of Software as a Service with our deep domain expertise in enterprise business solutions to deliver an on-demand alternative to ERP. While ERP requires complicated integrations and bolt-on additions to deal with changing business requirements, Workday is built from the ground up to support todayas agile enterprise, and our modern architecture means we can continue to adapt and extend our solutions to meet customer needs for years to come.

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Oliver Rist of InfoWorld points out in a new article that for SMBs, Software as a Service and other hosted software setups have enormous benefits for SMBs in cost reduction. SaaS eliminates many key maintenance costs that could potentially be crippling. SMBs are trusting the Internet more as reported outages decrease and broadband Internet access becomes more and more affordable. In addition to reducing the need for expensive hardware and constant upgrades, SMBs often can hire fewer IT staff. Read more.

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ZDNet Asia reported on a speech by Microsoft Thailand's Fukiat Julnual about how Microsoft views SaaS. Fukiat pointed out that Microsoft's policy is not to compete with its partners and that the company does not intend to become a Google or Salesforce.com, but that it is developing an advertising network to work with the traditional revenue stream such as an email service that caters for SaaS with a vendor or hosts with a third-party or traditionally on-premise. End users buy Exchange and then host it or resell it as a service but Microsoft is not a pure-play SaaS vendor itself. Read more.

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Rob Meinhardt of KACE wrote a commentary on ebizQ.net about a new kid in town to share the spotlight with SaaS: Appliance-based Software Delivery. The article points out that the rise of SaaS was originally fueled by the mid-market, and now Appliance-based Software Delivery offers some of the same benefits through a different format but with on-premise architecture and a more traditional upfront purchase. Read more.

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GigaOM's Allan Leinwand says service providers are taking notice of hte money to be made in delivering a myriad of services over the Internet. He points out that service providers have a habit of arriving late to a market and then dominating it, such as when they allowed start-ups to provide DSL over a physical infrastructure and then eventually drove the start-ups out of business. Scale is the key, he says, but service providers have a way to go to really earn the "2.0" moniker. Read more.

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IndustryWeek posted an interesting examination of how SaaS has "grown up" and entered life beyond CRM. Obviously Salesforce.com was a major pioneer in the Software-as-a-Service delivery model, but nowadays far more than CRM is available through SaaS delivery -- even business needs such as ERP and BPM and integration. Most sources are predicting heavy growth for SaaS in the years ahead. Read more..

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In the First Look podcast series, we recently spoke to John Delaney of eVision. EVision's MessageXchange.com solution is an interesting approach to handling integration and business process management through the SaaS model, and John had some interesting things to say about how this works and what to expect from the future of SaaS. Learn more here.

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With it being earnings time, it's interesting to see so many SaaS vendors reporting good earnings. eWeek has analysts predicting good earnings for Salesforce.com, and companies like QuickArrow, Smart Online, Sputnik, Innuity, and others are also reporting good growth.

Analysts are following suit, predicting fast SaaS growth. RBC Capital Markets and Gartner have both recently come out with big number predictions for growth in the sector. Will SaaS ultimately become the dominant delivery format for software? Time will tell.

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In a guest commentary on GCN, WebEx president of products and operations Gary Griffiths offered up a few interesting points on why some government information technology managers are shunning software-as-a-service applications and other on-demand service offerings. "If the government does not own the software, how can IT managers be sure it is secure?" he writes. Vendors are working on adaptations to meet government security requirements, he points out, because government managers tend to be suspicious of any company that lacks National Information Assurance Certification and Accreditation Process (NIACAP) compliance. Numerous other compliance regulations await in the wings, and it will be interesting to see how SaaS adapts to meet federal needs.

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CRM Buyer recently had two interesting articles on SaaS for CRM. The first, 10 Advantages of SaaS for the Call Center, laid out some benefits to choosing SaaS over traditional software, such as faster time to market, scalability, better control over business rules, and more. Indeed a great number of the reasons listed might be applicable to more areas than just the call center.

A second analysis looked at Enterprise Incentive Management. The article outlines why SaaS works particularly well for EIM and offers an example of the perfect infrastructure for such an implementation, offering suggested selection criteria as well for how to evaluate SaaS offerings to handle this business area.

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David Linthicum recently had some interesting things to say about how the evolution of PaaS (Platform-as-a-Service) relates to SaaS. The movement to service-based applications, to virtualization or outsourcing, and increased acceptance of on-demand computing are changing some fundamental ideas about enterprise computing. Companies now have more options than ever, and Linthicum predicts reduced costs and increased efficiency as more and more functions move to the newer models. Read more.

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An RBC Capital Markets survey reported by IT World Canada said that more than a quarter of IT managers from around the globe like the software-as-a-service model and an almost equal percentage are considering SaaS adoption. The numbers were drawn from a random sample of 800 IT managers attending the North American Technology Conference. The group also reported that TCO rather than security was the main barrier to SaaS adoption, and that CRM was the leading application being adopted through SaaS, followed by human resources. Read more.

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Sarbanes-Oxley (SOX) compliance can be a major headache for any company, and Crown Holdings Inc. is no exception. Until now, the packaging product supplier had been handling SOX compliance manually. But now they're turning to Business Intelligence International for help through the Aline4SOX tool, which works through Software-as-a-Service. Crown Holdings has 155 manufacturing plants in 42 countries.

"We realized we had some inefficiencies and some redundancies, so as we entered our fourth year of compliance, we knew that we wanted to automate the process,a said Tom Kelly, VP Corporate Controller, Crown Holdings Inc.

According to the press release, Aline4SOX offers the ability "to easily automate and streamline the SOX process, reduce expenses, and achieve repeatable success" with functions such as documenting and assiing control design, tracking testing, and remediating deficiencies.

Kelly said that the web-based SaaS model was an added plus that would ensure a smooth transition if the company decided to use the implementation in multiple locations.

Other companies offering Sarbanes Oxley compliance solutions through SaaS include Axentis and Servoy.

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Microsoft Project may dominate the market, but a San Mateo, Calif.-based company called Projity Inc. is hoping to change that with its free release of its project on-demand service called OpenProj. ComputerWorld reports that the company is owrking on getting the software bundled with various Linux flavors, including Mandriva, Mint, and Sabayon. The company is also in talks with OpenOffice.org and Sun Microsystems about integrating OpenProj with the companies' respective productivity applications. Projity's CEO feels that Microsoft Project is especially vulnerable to open source competition thanks to its high price tag. Read more.

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Joshua Greenbaum, ZDNet's Enterprise Anti-matter blogger, had an interesting take on the upcoming IPO of SuccessFactors, a San Mateo, California company that offers SaaS-based performance management software. Calling SuccessFactors "the latest poster-child for SaaS," Greenbaum looked at the company's S-1 filing and remarked on several important questions. Is the customer acquisition rate strong enough, and what kind of customers are signing on for the company's services? Is the financial management strong enough? And what about the product strategy? Greenbaum suggests viewing SuccessFactors' own success with an asterisk on whether the company is trying to compete with on-premise vendors or actually operating as an adjunct. Read more.

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A new forecast by Gartner has SaaS dominating the market by 2011. The Gartner report predicts an annual growth rate of 22.1% through 2011, more than double the growth expected in the overall enterprise software market, with well over half of software infrastructure products and software applications being available in software-as-a-service delivery by then. Read more.

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CRN reported today some interesting survey results from the VARBusiness 2007 State of Technology Survey on Business Software. Participants were asked about the biggest obstacles to selling Software-as-a-Service applications and the most common concerns were trust and security, client resistance to outsourcing software, and client resistance to SaaS pricing models. Almost half the respondents were already involved with SaaS, and of those, 60% expected SaaS to force business evolution. Forrester Research analyst Michael Speyer expressed doubts that many solution providers were ready to make the tough strategic decisions that are involved in adopting SaaS. More here.

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James Taylor: I had an interesting call with Aaron from SeaTab last week. SeaTab is a SaaS BI vendor focused on retail, CBG and supply chain. Aaron was briefing folks as SeaTab had a new release out - we did not get into the details as I was more interested in general questions but you can see the press release they put out here. Aaron went through the basics of the product, describing it as very user configurable, down to calculations in individual reports. The integration of structured data from almost any source is a big focus and the product boasts that it requires no physical data warehouse or marts - it has no pre-defined dimensionality. More here

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