Sightings in SaaS

There has long been a discussion of business continuity with regards to the use of software as a service. The question is simply that with both your data and tools of business – read applications and database – running on a cloud infrastructure that belongs to a vendor, how do you plan for disaster or loss of a vendor. After all, in this economic climate it’s not if some vendors will fail, but when.

The question is a good one, let’s be honest. As companies like SF.com and NetSuite move upmarket they are bound to hear more questions of this kind from prospects in all markets. In other words, it’s not unreasonable to ask these questions. On this blog, in its last incarnation, we wrote about this topic often, but with, as I now realize, a bit of a chip on our shoulder.

We always argued that forcing SaaS vendors to answer these questions was unfair because no one ever asks these questions of on-premise software vendors. There is some justification for this defense, but I don’t think it really stacks up, all things considered. If an on-premise vendor ceases to exist, the customer has some ability and time to put together another solution and migrate, etc. But if you lose your SaaS provider you’re in some deep water.

So what is to be done? The question of business continuity came up again when my fellow Enterprise Irregular, Vinnie Mirchandani, questioned a post by Frank Scavo. I respect both of these gentlemen a good deal, especially now that several industry players got involved in a debate on both Frank’s and Vinnie’s posts. Some of the ideas were excellent and should be more widely circulated. Here they are in a nutshell:

• Provide a backup mysql database to the customer (RightNow idea).
• Provide a Trust, setup for and by customers, that in the event of vendor liquidation has the ability to take over operations of the software. This would at least give customers the time needed to migrate to a new solution, and therefore make on-premise and SaaS even in this regard.
• Software Escrow Account
• On-premise vendor managed backup system

The ideas are across the board as you can see, but what finally has to be answered is what works and what is affordable. In my mind this leave the first two option as both workable and affordable, and the last two fall off as unworkable, the escrow idea, or simply not affordable – the on-premise, vendor managed solution.

If I had to choose one idea I would select the Trust. SaaS providers could set aside $5 bucks per year per user into a trust that would pay to continue maintaining the software for a full 6 months in the case of vendor insolvency, or to restore the service in the case of data center emergency, etc. This makes a lot of sense to me and I hope that SaaS providers start thinking along these lines in the near future.  Regardless of what they finally come up with, it’s important to take this whole contingency planning/business continuity issue seriously. In the end, serious businesses are taken seriously.

On the other hand, it’s really discouraging to see some of the on-premise pimps show up on the comments as well. You can tell some of these writers are not technology professionals but simply the pr types/hacks spreading around the FUD. I think in some ways it is the presence of so much FUD that makes SaaS providers avoid this issue. Put that issue aside though and meet the challenge head on. That’s the best way to win in the end.