Interop Keynote Panel on Current Software Trends

May 2nd, 2008 by David Link

The software trends panel preceded Jayshree Ullal’s keynote presentation at Interop 2008.

Software Trends Panelists:

• Roger Burkhardt, –President and CEO, Ingress Corporation
• Stephen J. Mellar, –Freeter, Integranova
• Phillip Winslow, — Vice President – Software Analyst, Credit Suisse

First Question: Can you tell us why your company is uniquely position to capitalize on the trends taking over the software marketplace?

Burkhardt: Opensource is so critically important to Ingress – The Huge trend = Software as a Service (saas) vendors are increasingly using opensource and a lot of folks are looking to partner with opensource companies that don’t compete with you… legacy Database vendors are now finding themselves competing with ISV applications more often as they try to build vertical applications on top of their core database products.

Gartner recently said that Ingress was the only opensource database that is used for business critical applications. More than 10,000 customers are running on this proven database product, which has been developed over the past 30 years. Burkhardt said that Ingress runs much of their own business on SAAS platforms so we are big believers!

Mellar: Executable models build a sound model and transform into an implementation. Executable modeling will be the mainstream model for software development within 3 years time. Why would I say that?

1. Existence of standards – Unified Modeling Language Standard is on the way
2. Open Source – Eclipse Foundation is a big deal for getting tools to work together.
3. Executable modeling has been seen as a risk – Creates the need to buy a compiler – not a cheap thing to build. Risk is a big issue – this is why software as a service is a big deal ….. Next generation of tools will be selling a model compiler as a software as a service so you can pay per function point to compile on your particular target. This reduces the risk – don’t have to plunk down a huge license fee.

Winslow: Currently we have an environment that is placing a great deal of pressure on IT budgets – but at the same time IT is pressured to deliver more value with less budget.

We are trying to provide the extra value, but lower our ongoing cost of doing business.

• 80% of the current budget is sent to keeping the lights on.
• So we have to figure out ways to become more efficient.
• 3 years ago would Credit Suisse ever consider SAAS? My Answer: No

Today, SAAS makes a lot of sense to roll out new applications with increased flexibility and much lower upfront cost.

Pressure of the IT budgets is creating significant change about how new applications are deployed.

Second Question: What kind of impact does an opensource project bring to IT departments?

Burkhardt: Adoption among mid and small scale orgs is even faster than vs. large orgs.

At Ingress we are creating open source stacks, such as Content Mgt. appliance

Business Intelligence appliance. These are software appliances – they are so compelling because they reduce the customer deployment effort by 70% by creating the software appliance!

People quickly got burned by handing things off to operations – but have to look at security, reliability, scalability…but the decision at the front-end has to think about the lifecycle costs and operational support of the project.

Winslow:

Credit Suisse is looking at SAAS, SOA, and Opensource.

This year IT is focused on the cost side…Are we really in the business of running E-mail/MS Exchange service, or CRM services. What we are seeing here is the inflexibility of our significant customization of packaged software and then the significant burden of managing it ourselves.

E-mail is one of the first applications that we are looking at a SAAS solution. For Credit Suisse, having IT manage E-mail infrastructure is not a wise decision… it is not a differentiator… I see it just like a utility, like power or water. Use G-mail or Hosted by Microsoft Exchange, leverage the web 2.0 and enterprise functionality to the end users.

Catalyst of getting rid of cost and operational expense during constrained budgets.

Question 3: Does SAAS and Opensource get us better positioned after we have done this vs. before going in to these projects?

Burkhardt: A time when there is significant pressure on budgets is a great time for Managers to make bold decisions and promote change. Organizations are typically much more resistance to change when resources are plentiful. Using the SAAS model you can restore some of the lost to budget cuts projects because you don’t have to pay the upftont cap-ex costs by using the SAAS model. This new business model is pushing new projects through and empowering end users to pushing new projects and business solutions through to help IT get the important project back on track via SAAS.

Winslow: The Big technology companies are competing with a different business model, but it doesn’t keep from the fact that the big guys are addicted to the upfront license fees…. Real challenge for large players because the SAAS model is too disruptive to revenue flow you need to report to Wall Street.

Last Question: Crystal ball questions.

Please predict the biggest IT story for 2008

1. Burkhardt: How cio’s survivied downturn by doing more vs. less.. how they did it and survived… people who rose to the top and made change happen
2. Mellar: No idea – Expect some new TLA or 3 letter actonym that everyone feels fashionable.
3. Winslow: decoupling of the end user platform. Virtualization and desktop virtualization and layering on SAAS… Salesforce.com, gmail, etc how we think about the desktop sitting on our desk will be much different.

My overall thoughts here, not a ton of new ideas, but clearly SAAS was a very big topic at Interop, which is strange given the traditional nature of Interop’s typical focus on the network and interoperability issues. I did find it completely interesting that Phillip Winslow considered e-mail a utility and would consider outsourcing to corporate G-mail.

I had predicted this to occur about 20 years ago, while I was at CompuServe and we were outsourcing e-mail for Marriott, Mobil oil and many other companies. Wow was I way too early with my prognosis… but Credit Suisse is a very big organization, so what will be exciting to watch is the speed at which mainstream corporate e-mail becomes an outsourced utility.

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