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The Sweet Science of Cloud Computing

The Purse, the Belt, the Glory - Welcome to Fight Night

One sure sign that a new technology market is approaching critical mass is when people start fighting over it.  I'm not talking about abstract arguments and dialectical debates about meanings and means.  I'm talkin' fisticuffs, mano a mano, the sweet science!  And with cloud computing, it's on now, Baby.

OK, maybe it was more like one-sided trash talking at the weigh-in before a title bout, but this week we heard plenty of it, in two weight classes, no less.

In the middle-weight division, we saw the young and scrappy contender NetSuite mixing it up with aging titlist SAP and at the same time Microsoft got in fellow heavyweight Google's face, big time.  Here's how it went down.

The Undercard

It should come as no surprise to anybody that NetSuite would have it in for SAP, in general.  NetSuite's majority shareholder is Oracle's CEO Larry Ellison and its senior executives are mostly former Ellison lieutenants and acolytes, so, invectives for SAP probably comes pretty naturally to the lot.

In addition to that and more to the point, though, the two companies play in many of the same software categories - ERP, CRM, Financials and others.  Until recently, though, they did so in separate universes, with NetSuite subscribed in the cloud and SAP licensed in the data center.  But, then came SAP's Business ByDesign, a messy cloud capitulation now on its second or third re-launch.  Although BBD is unlikely to stop or even slow NetSuite's cocky cakewalk, SAP has enough bucks and bile - albeit less of the former and more of the latter since Oracle's very recent $1.3b court victory against them - to harsh NetSuite's buzz.

So, either to kick SAP while they are down or just to keep Business ByDesign from getting any traction, in a very Ellisonesque way, NetSuite has gone on the full offensive, and not in that "best defense" kind of way, either.  (In the Tao of Chairman Larry, defense is for losers; it's all offense all the time.)

In a press release and a more elaborate blog entry, both titled, "SAP Brings Stone-Age Software Economics to Cloud Computing", NetSuite has aggressively called SAP out with a scathing side-by-side TCO comparison.  The ostensibly empirical results show that SAP will cost over a half a million dollars to seat ten users for five years while NetSuite can do the same job for a mere $187K.

The NetSuite press release also takes a couple of other mild shots at SAP for BBDs lagging functionality and the company's awkward advance on the cloud, saying:

"By providing an under-powered product with an extremely high total cost of ownership, SAP has fallen into the trap of every stone-age software provider that has tried to make the transition to the cloud and not cannibalize its installed base."

But, the most vigorous vituperation is reserved for the blog entry:

"By trying to make the same kind of money they made in the good old on-premise days with their new "cloud' solutions, they're carrying their on-premise ERP bloated TCO habits over to the world of the cloud. They want to inflict the heinous on-premise costs of last two decades on you, as you try and move your business forward into the next decade. [...] In a nutshell, SAP Business ByDesign costs way more money, for way less functionality. So it's no surprise that ‘SAP struggles to find takers for its Business ByDesign SaaS offering'!"


The Main Event

But, as sharp as those words may seem, they are but reedy screed beside the bellicose bluster of the behemoth Microsoft going after Google.

This time, the designated pugilist is Tom Rizzo, Microsoft's Senior Director of Online Services.  A few days ago he showed up in a freewheeling Computerworld interview wherein he excoriated the search giant for their maneuvers in cloud computing.  In it, he dings Google for their SLA, sticky-fingered data practices, looseness about privacy, and general failure in the enterprise space, and then says how he really feels in this Q&A:

"Are you saying that Google is failing? I would say that they're failing, yes. I would say that the results have not shown that they're successful in the space. We've had customers who've gone to Google and have come back to Microsoft."

Then, the day after that interview ran, Google was quick to trumpet their triumph over incumbent IBM/Lotus and contender Microsoft in winning 17,000 seats at the General Services Administration for their government edition of Google Apps.  At a mere $6.7m, it's a small deal, but you'd never know that from Google's crowing.

"GSA is leading the way in embracing the federal government's "cloud first" policy, under which agencies should opt for hosted applications when secure, reliable, cost-effective options are available. We are thrilled that GSA has chosen to move to the cloud with Google and look forward to expanding our productive partnership with them."

That was all Rizzo needed to hear to make him launch a snarky riposte on the Why Microsoft TechNet blog.

After curtly acknowledging the loss, he takes pains to make it clear that while Google got the internal email business from the GSA, Microsoft "will continue to serve its productivity needs through the familiar experience of Microsoft Office."

He gets a little passive-aggressive about why Microsoft lost the deal.  Perhaps intimating poor judgment on the government's part, he sniffs, "we look forward to understanding more about GSA's selection criteria - especially around security and architecture. "

And he wraps up his opening gambit by reminding everyone, "We are also gratified so many state and local governments continue to choose Microsoft.   There are clear reasons behind these choices."

He follows up the opening with the first of two headlines:  "Adding Random Functionality is not Really Adding Functionality", setting up the point that Google is consumer-focused and this makes them a bad choice for business.

"While it's not clear to us how useful business customers will find applications such as Picasa Web Albums, Google Voice and Adwords, some of our customers don't seem to be impressed with the value they receive from Google."

OK, Picasa, sure.  But, Voice and Adwords?  Really?  I can think of plenty of businesses who are probably plenty impressed with Google Voice, a service that lets smartphone users make voice calls to any number in the US for free.  And, as for Adwords, he is actually referring to a recent change by Google that allows access to Adwords administration from within Google Apps, rather than an individual Google account.  Again, that seems like a something a business using Google Apps and Google Adwords would indeed find very useful.

Then, it's this tortured second headline: "You have to meet the Height Requirement to Ride in the Enterprise".  I can't think of a single enterprise that would be gratified by being characterized as an amusement park ride for software vendors.  Plus, 24 point type doesn't make it a separate point.  We get it!  Rizzo and Microsoft don't think that Google gets the enterprise.  But he soldiers on, following the headline with this equally painful (to watch) paragraph and a few more like it.

"There's no doubt that businesses are talking to Google, and hearing their pitch, but despite all the talk, Google can't avoid the fact that often times they cannot meet basic requirements. For instance, in California, the state determined that Google couldn't meet many of their basic requirements around functionality and security."

As you will see if you read Rizzo's full Raging Bull soliloquy, it prompted a lively stream of comments by numerous readers, some friendly, others not, and many just pitying.  One in particular nailed it pretty well:

"Sorry, but this is just the *wrong* type of messaging for someone supposedly in a superior position.  Good prize-fighters 'cuss the opposition before the fight by way of taunts and insults, then afterwards nod in admiration and move on.  This does neither, Microsoft see the world as its enemy and then ticks it off afterwards.  So it will be with Office and Linux in the coming 2 years.

All signs of an organization akin to a limping animal, wounded and dangerous.

Good luck."


To that reader's point, it is interesting to contrast Rizzo's rueful remonstrations with the way Google talks about Microsoft.  Last spring, Computerworld interviewed Dave  Girouard, president of Google's Enterprise Division and here is how he answered the question, "Who do you see as your biggest competitors?"

"There's Microsoft and then there's Microsoft. Obviously, there are multiple competitors, but the one we see the most and talk about the most is Microsoft because they're the gorilla in the market. They tend to have competitive products to what we have. Cisco is kind of getting into this game. And IBM is in there. I would certainly characterize those as far less directly competitive."

But then when the interviewer pressed him on that point, saying, "Microsoft has a big head start on you. How will you deal with that?" Girouard said this:

"We don't have enough time for me to list [all our advantages]. To use Microsoft and do some form of cloud-based editing, it is ugly and complex. To get the new Google Apps, what do you have to do? Refresh your browser. That fundamental difference is what will make Google successful against Microsoft."

Float like a butterfly, sting like a bee.  Google looks like Muhammad Ali next to Microsoft's Jake Lamotta.

The preliminary bout of NetSuite vs. SAP and the Microsoft vs. Google main event make up the card for just the first cloud fight night, with many more to come.  There will probably be some surprises as we go along, but it is already clear who two of the champeens might be.

More Stories By Tim Negris

Tim Negris is SVP, Marketing & Sales at Yottamine Analytics, a pioneering Big Data machine learning software company. He occasionally authors software industry news analysis and insights on Ulitzer.com, is a 25-year technology industry veteran with expertise in software development, database, networking, social media, cloud computing, mobile apps, analytics, and other enabling technologies.

He is recognized for ability to rapidly translate complex technical information and concepts into compelling, actionable knowledge. He is also widely credited with coining the term and co-developing the concept of the “Thin Client” computing model while working for Larry Ellison in the early days of Oracle.

Tim has also held a variety of executive and consulting roles in a numerous start-ups, and several established companies, including Sybase, Oracle, HP, Dell, and IBM. He is a frequent contributor to a number of publications and sites, focusing on technologies and their applications, and has written a number of advanced software applications for social media, video streaming, and music education.

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