A11: Getting to SaaS Ken Wilner Vice President of Technology

A11: Getting to SaaS

Ken Wilner Vice President of Technology

2 © 2008 Progress Software Corporation

Agenda

What is SaaS Building for SaaS Summary


What is SaaS?

Subscribe to use the software rather than acquiring it

Application is owned, hosted, supported, and maintained by service provider

Accessed remotely over the Internet by multiple customers (tenants)


For Application Partners it means…

Reach more/newer customers Grow your business. Economies of scale Standardize offerings Focus on improvements, not supporting one-offs


For End-users it means…

Lower initial costs Pay for use, not IT / infrastructure Faster time-to-value, from months to days. Cost effective dynamic scalability

Subscribe and Use


Multitenancy

Tenant = Customer Each tenant has their own end-users Each tenant experience is that the application is dedicated to them Allow computing resources to be shared among tenants Multiple implementation models


Packaged Applications vs. SaaS

From: Develop Package Ship To: Build Deploy Service

Packaged Apps SaaS

App : Customers 1:1 1:N

Deploy On-premises Off-premises

Resources Dedicated Shared

CustomizationPer application – coded or

configuredPer tenant - configured

Updates cycle 1-3 years Continuous

Expenses Purchase Subscription

Must have additional services

N/AHosting, provisioning, usage

metering, billing, dynamic scalability


It’s Happening… Now

Over 200 Progress Application Partners Are Doing SaaS Now

~ 40% Say It Will Be More Than Half Their New Business By 2010


Agenda

What is SaaS Building for SaaS Summary


Delivery, Hosting, Web Infrastructure,

IT Services

CPU, storage, bandwidthSecurityContinuous availabilityScalability, reliability, performanceBackup and recovery…


IT Services


What Do You Need

Build, Buy, Subscribe

ApplicationsApplicationsApplication Services

with multitenancy

Application Services

with multitenancy

Business ServicesProvisioning

Identity and access mgmt

Usage metering

Billing and payments

Audit and compliance

Customer service

Support and helpdesk

…

Business ServicesProvisioning

Identity and access mgmt

Usage metering



Customer service


…



IT Services



IT Services


What Do You Need

Build, Buy, Subscribe, Partner

ApplicationsApplicationsApplication Services Application Services

with multitenancywith multitenancy

Application Services Application Services


Business ServicesBusiness ServicesProvisioningProvisioning

Identity and access mgmtIdentity and access mgmt

Usage meteringUsage metering

Billing and paymentsBilling and payments


Customer service


…






Customer service


…


Multitenancy – Major Architectural Options

A. Everything Isolated

B. Everything Isolated Except Infrastructure

C. Shared Everything

D. Shared Everything Except DBs

Maturity Levels


B. Everything Isolated Except

Infrastructure



Application Isolated Isolated Shared Shared

Database Isolated Isolated Shared Isolated

Infrastructure Isolated Shared Shared Shared



Application Isolated

Database Isolated

Infrastructure Isolated

Tenant2Tenant2 Tenant3Tenant3

AppApp AppApp AppApp

DBDB DBDB DBDB

InfrastructureInfrastructure InfrastructureInfrastructure InfrastructureInfrastructure

Tenant1Tenant1

What is it


Tenant1Tenant1 Tenant2Tenant2 Tenant3Tenant3

AppApp AppApp AppApp

DBDB DBDB DBDB

InfrastructureInfrastructure


Application Isolated

Database Isolated

Infrastructure Shared

What is it


Tenancy Through physical isolation. Separate hosts

Virtualization

Pathnames and naming

Application No change. Infrastructure provides physical separation

Versions can be different

Tenant-aware naming resolves naming conflicts

Servers (AppServer™, WebSpeed®) naming e.g. <TenantID>servicename

Database No change. Infrastructure provides physical separation

Tenant-aware naming resolves naming conflicts e.g. <TenantID>dbname

Infrastructure Host per tenant

Shared host:

• Citrix / Terminal Services “partition” per tenant

• Virtual environment / software appliance per tenant

Implementation

A. Everything Isolated andB. Everything Isolated Except Infrastructure



AppApp

DBDB



Application Shared

Database Shared


What is it


Tenancy Through TenantID

Stored in Tenancy Registry

Flows through all layers of application

• Authentication maps end-user to TenantID

• Business objects activation

• Data access (ABL and SQL)

Application Single instance. Multitenancy by setting and using TenantID throughout all application layers

TenantID+UserID to handle UserID duplicates across tenants

Database CRUD always includes TenantID

ODBC/JDBC access through SQL Views setting TenantID


Implementation


Database Single instance

Tables include TenantID field. Indices use TenantID for CRUD

May want to consider SQL Views for Reporting and BI

Infrastructure Everything Shared:

CPUs, RAM, HD, Communications, Web servers, etc


Implementation

TenantID CustNum Name

1 1 John Smith

2 1 Jane Doe

1 2 Ludovic Eiffel

2 2 Ingrid Schnabel

… … …



DBDB DBDB DBDB


AppApp


Application Shared

Database Isolated


What is it



ImplementationTenancy Through TenantID and Isolated Databases: TenantID-

DBname value pairs

Stored in Tenancy Registry

Flows through all layers of application

• Authentication maps end-user to TenantID

• Business objects activation

• Database tenancy through TenantID-DBname value-

pairs

Application Single instance. Multitenancy by setting and using TenantID throughout all application layers, and database tenancy through TenantID-DBname value-pairs

TenantID+UserID to handle UserID duplicates across tenants



Database Isolated by tenant. Tenancy through DB naming model:

e.g. <tenant1>/db, dbsfolder/<tenant1>db,…

Tables do not need TenantID field

No need for SQL Views for ODBC/JDBC

Infrastructure Everything Shared:

CPUs, RAM, HD, Communications, Web servers, etc

Implementation


Sharing Isolating

Better economy of scaleSimpler managementTarget like-customersLeast cost to serve

Easier customization, securitySimpler throttling control

Target dissimilar customersNo transformation

Application

Database

Infrastructure

Multitenancy Options Continuum


When to Consider





Time to market Short Short Longest Long

Infrastructure costs

High High Low Low

Economies of scale

Very poor Poor Highest High

Scalability Poor Poor Highest High

Provisioning Difficult Difficult Easiest Easy

Admin/Mgmt costs

Very high High Lowest Low

Target type of tenants

Dissimilar Dissimilar Similar Similar

Multitenant App Transformation

No No Yes Yes (except DBs)

Coding difficulty Easy Easy Difficult Less difficult

Implement SLAs Easier Easy Difficult Less difficult

Containment Easier Easy Difficult Less difficult


Typical SaaS Configurations

Most popular configurations• WebSpeed• WebClient™

• Citrix / Terminal Services - OpenEdge® GUI Client Using hosting provider ~50% Multi-tenancy

• Most doing (Time to market)– Everything Isolated– Everything isolated Except Infrastructure

• A few– Shared everything, but db

• Very few– Shared everything

# Tenants: 2-200 # Users: 2-40000



IT Services



IT Services


What Do You Need

Build, Buy, Subscribe, Partner

ApplicationsApplicationsApplication Services Application Services


Application Services Application Services







Customer service


…






Customer service


…


Provisioning

Tenants and Application Provisioning• Configurability to organizational, business or services• Provision incremental on-demand functionality

User Provisioning• Create, maintain, [de]activate, propagate, delegate• Users, groups, roles and attributes

Provisioning interfaces for integration with• Security, identity management, metering, billing,

payments• User self-service and customer service

User Life Cycle Automation, Self-Service and Trials

Provision


Identity and Access Management

More than your current authentication, authorization• Multitenant (e.g. more than one “John

Smith”)• Configurable per tenant • Diverse identity management single

sign-on requirements• Guarantees that a tenant cannot get

access to some other tenants data

Identity management provides or integrates with• Access control system

– Restrict by tenant in addition to User-, Role-, Policy-based

MetadataMetadata

LDAP/AD

LDAP/AD

Tokens

TokensSSOSSO

Security and Privacy


Usage Metering, Billing, and Payments

How do you bill today? License and maintenance

Flexible, configurable metrics• User, flat-rates, one-time, transaction, document• Usage metering • Evaluation and trials

Metering captures usage. Generate invoices• Tenant• Usage type• Charge and frequency type• Policies (e.g. price, discount schemes)

Integrate with• Payments system: Dunning, collection, suspension, cancellation,

notifications• Identity management, PCI, provisioning, USS, CSR, CRM

Configurable Usage to User and Business Metrics

June

July

August


Reachable market

In Summary

Extremely powerful business drivers for APs and End-users

Tremendous opportunity to grow your business Design, architect and build applications with SaaS

built-in• Multitenancy

• Assess best model to your needs• Security without compromises• Modularize

– For continuous improvements• Service: Provisioning, identity and access

management, usage metering, billing and payments

Subscribe and Use

Low

er

Cos

t

Build Deploy Service


7. Sales & Marketing Support

6. Technical &Consulting Support

5. Application Transformation

4. Best

Practices

3. Training & Empowerment

Workshops

2. SaaSBusiness

Planning &Modeling

1. Market Assessment

Progress Comprehensive SaaS Enablement Offerings

Where To Go From Here …

Progress Comprehensive

SaaS Enablement

Offerings


Questions?


Thank You


34 © 2008 Progress Software CorporationDEV-17: Getting to SaaS

Reference slides…


3 1

3 1

What if…


3days 1cust

3 1

What if…


3days 1cust

3min 100cust

What if…


30K €

License vs.

15K €

Subscription

15 € user / month

x 100 customers

x 10 users / cust

June 6K €

Maintenance vs.

15K €

Subscription

July6K €

Maintenance vs.

15K €

Subscription

August

What if…


30K €

License vs.

15K €

Subscription

15 € user / month

x 100 customers

x 10 users / cust

June 6K €

Maintenance vs.

15K €

Subscription

July6K €

Maintenance vs.

15K €

Subscription

August

What if…

In one quarter:In one quarter:

Packaged Application: Packaged Application: 42K 42K €€SaaS:SaaS: 45K 45K €€

In one year:In one year:

Packaged Application: Packaged Application: 96K €96K €SaaS:SaaS: 180K 180K €€


Unreachable market

Cost to provide software

Number of customers

Rev

en

ue

/ C

ust

om

er

Reachable market

Business Opportunity: Reach New Markets/Customers - Long Tail

Lower cost of providing software per customer:

Taking advantage of economy-of-scaleCentralize (share) hardware and softwareCentralize (share) servicesStandardize offeringsReduce complexity – little/no custom work


Reachable market

Think Small to get BIG….

• Small, very-small businesses • inaccessible• could not afford the business applications they needed• too expensive and/or too costly (HW, SWI, IT, etc)• most apps were not built with them in mind – too much focus

on large enterprises• need for vertical/business process expertise


SaaS – Major Drivers and Benefits

For APs

Grow customer base Economies-of-scale Reduce costs

Standardize offerings Competency focus

For End-users

Lower and predictable costs Agility (rapid time to value) Reach Cost effective dynamic

scalability

Subscribe and Use

Low

er

Cos

t


Major SaaS Inhibitors, Real and Perceived

Customer resistance• Confusion• Stickiness of on-premises applications• Change of vendor• Perceived loss of control over data

Security and privacy• Appropriate measures in place• Not whether off-premises vs. on-premises

Robustness and reliability Integration complexity Customization vs. configuration



Analysts Forecasts

• ERP Market grow 10% CAGR, 2006-2010• ERP SaaS spend grow at 39% CAGR, 2006-2010• ERP SaaS spend reaching US$400m by 2010

• SaaS = 5% of worldwide spend on business software in 2005• SaaS to grow to 25% of new business software spend by 2011• SaaS will grow 7x faster than on-premise over next 3 years• By 2013, >75% of Customer service centres will use SaaS

• Spending priorities – Enterprise overall spend– 61% - Messaging / email / collaboration– 18% - Major ERP upgrade– 16% - Major CRM upgrade

• Enterprise interest in SaaS– 54% - HR/HCM– 40% - ERP– 38% - CRM


Forecasts

Two out of three businesses are either buying or considering buying software via the subscription model

The proportion of CIOs considering adopting SaaS applications in the coming year has gone from 38% a year to 61%


CPU, storage, bandwidthContinuous availabilityScalability, reliability, performanceBackup and recovery…

Delivery, Hosting, Web Infrastructure, IT Services

CPU, storage, bandwidthContinuous availabilityScalability, reliability, performanceBackup and recovery…

Delivery, Hosting, Web Infrastructure, IT Services

Partner with or outsource to a data center, managed hosting provider

A.Everything IsolatedB.Shared EverythingC.Shared Everything Except DBs

Presentation

Business Components

Data Access

Data Sources

Co

mm

on

Infrastru

cture

Enterprise Services

What Do You Need


with multitenancy


with multitenancy

TENANT METADATA

MANAGEMENT, …

Business Services

Provisioning

Identity and Access Mgmt

Usage Metering


Customer service


…

Business Services

Provisioning

Identity and Access Mgmt

Usage Metering


Customer service


…


Multitenancy and Database

Isolated – Separate database per tenant• When tenants don’t want to or can’t share

Shared – Multitenant data model• Add tenant identifier field. Index.

• Use tenant identifier in all your CRUD

• May want to consider SQL Views for Reporting and BI

TenantID CustNum Name

1 1 John Smith

2 1 Jane Doe

1 2 Ludovic Eiffel

2 2 Ingrid Schnabel

… … …


Multitenancy and Business Logic

Multitenancy SOA - OERA through all layers Modular and loosely coupled for agility …

• To monetize• To maintain, integrate and distribute• To personalize and continuous enhancements (3-6mo)

State-free (or stateless) for …• Scalability• Better ability to load balance

Maximize concurrency Open standards integration interfaces

• Tenants need comprehensive business processes• Extended integration boundaries with on-premises, other SaaS


User Interface

Web browser GUI. Reach.• Fastest time-to-value ([near] zero footprint)• Uniform, central management

• Lightweight AJAX (e.g. YUI, Dojo, Prototype,…)• Heavyweight AJAX (e.g. GWT, Backbase, Nexaweb, OpenLazslo,

ASP.NET™, …)• RIA¹ Platforms (e.g. Adobe® Flash/Flex, Silverlight™, Java™

Applets…)

Desktop GUI. Richness.• Advanced GUI (w/ WebClient™ and AIA)

• Microsoft® ClickOnce (w/ AIA)

• Java WebStart (w/ AIA)

• Adobe AIR client (w/ AIA)

OpenEdge GUI or ChUI (w/ Citrix or Terminal Services)

User Interface That Fits The User’s Needs

¹ RIA = Rich Internet Applications


Integration

Integration Application Services, including• For synchronization • For composites• Hybrid: With SaaS, packaged applications and

on-premises

Integration Business Services, including• Identity and Provisioning• Usage, Billing and Payment• CSR, CRM and Helpdesk

SOA and OERA best to meet requirements • Loosely coupled, contracted, governed

services• Messaging, ESB, Web services• Adapters (e.g. SFDC, iWay, SAP, etc.)

Build Agile Application Services. SOA.

Presentation

Business Components

Data Access

Data Sources

Co

mm

on

Infrastru

cture

Enterprise Services


Personalization (configurability)

Enable users to modify application behavior (e.g. layout)

• Metadata

• Configurability. No custom code• User preferences• Rules (e.g. by tenant, user,

role/group, security)• Actual contents

Personalization improves user experience• Stickiness• To the user the UI is the application


Delivery: Hosting and Infrastructure ServicesOperations: Outsourcing vs. Hosting in-house

Running services totally different than delivering applications Much higher user expectations

Availability, reliability, scalability, performance• Internet public infrastructure • Global distributed centers • On-demand. Scale up and out • Load balance. Failover• Notifications and alerts

Security and governance• Integration with Identity Management. SSO• Encryption• Continuous monitoring and management• Policy-driven. SLA


Summary

Think like a services company. Customers pay recurring subscription fees for recurring value.

Until now: Software vendors are islands. Customers need to find, purchase and integrate to build the solution they need

Next: Software and service providers collaborate and offer application services for comprehensive industry vertical business solutions

Subscribe and Use

Low

er

Cos

t


Service ProviderEnd UserLicense Owner

Partner Provides a Monthly Royalty Report

Royalty Payments – based on agreed value metric - NO Upfront payments

None

Service Provider License Agreement (SPLA)

SaaS

Each License Purchased Separately

Orders

Discount Off List orPercent of Application

End User License Agreement (EULA)

Reseller Agreement

Business as Usual

End User Agreement

Payment to Progress

Partner Agreement

SaaS allows for better business term alignment

Progress SPLA

Key Differences

Documents

A11: Getting to SaaS Ken Wilner Vice President of Technology