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SaaS For Developers : Abhijit Gadkari , Enterprise Architect , AMG-SIU

Image Ref : http://fredchong.members.winisp.net/Shared%20Documents/SaaS%20Provider%20Long%20Tail.JPG

Software As Service [SaaS]

“Intel sees that Software as a Service is changing the way that people use software and the underlying technologies. They wanted to get close to the SaaS companies and see how their product could be used more effectively for them,” Opsource CEO Treb Ryan http://www.ebizq.net/blogs/firstlook/2006/09/intel_leads_20m_funding_of_ops.php

A Different Business Model !

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New Business Platform : Internet

Software As Service [SaaS]

•ComScore estimates that Americans made 6.6 billion online searches in April

2006

•eBay reported record consolidated Q4-06 net revenues of $1.7 billion, representing

a growth rate of 29% year over year.

•PageZero Media estimated that paid search advertising market was

in the range of $15 billion USD in 2006

•Lulu.com says it publishes 2300 books a month

•“ATA's site went live in May 2002…it often racks up $100,000 in sales in an hour “

•Salesforce.com has 27,100 Customers, 56,000 Subscribers and supports

12 Languages

Information collected fromEbay: http://files.shareholder.com/downloads/ebay/88723301x0x69405/2cbacae7-15cf-46fb-9a19-a89664d4e591/eBayIncEarningsReleaseQ42006.pdfSalesforce.comLulu.comFrom Niches to Riches:The anatomy of the Long Tail

Supply & Demand: Software Pricing By Jeffrey Rothfeder , e-week February 26, 2004

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Anatomy of the Long-Tail

Ref : http://www.wired.com/wired/archive/12.10/tail.htm

Software As Service [SaaS]

Tapping on non-addressable markets. Lower cost of service

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What is “Long-Tail”?

The phrase The Long Tail was first coined by Chris Anderson in an October 2004 Wired magazine article. It describe certain business and economic models such as Amazon or Netflix.

Long Tail Vs Pareto Principle a.k.a. 80/20 Rule

80/20 rule says a small proportion (e.g. 20%) of a company’s products often generates a large proportion (e.g. 80%) of company’s sales.

Long Tail says effectiveness of distribution channel will decide the company’s sales.Factors like search cost, shelf space, recommendation system, etc. will be important.

Source: “Goodbye Pareto Principle, Hello Long Tail: Modeling and Measuring the Effect of Search Cost on Product Sales and Distribution by Brynjolfsson et al.

Product Category Large Online Retailer holds Large Brick-and-Mortar Store holds

Books 3,000,000 books 40,000-100,000 books CDs 250,000 CDs 5,000-15,000 CDs DVDs 18,000 DVDs 500-15000 DVDs

Software As Service [SaaS]

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SaaS VS ASP

Software As Service [SaaS]

Logical Partitioningof CODE & DATA

Physical Partitioningof CODE & DATA

Same AppInstanceFor allCustomer

Customizable AppInstance For MultipleCustomers

Traditional ASP

SaaS

Traditional ASP : Client - Server App where Server is hosted by Service Provider.Business Model is based on Economy of Scale e.g. TurboTax On-Line app. SaaS : Each App instance is customized for every customer using metadata and templates / config files. Business Model is based on Economy of Scale and Scope. e.g. Remend.com

Instance

Partitioning

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Fundamentals of SaaS

Hosted

Scalable

Configurable

SaaS

OperationalArchitecture

ApplicationArchitecture

BusinessModel

Workday.com

Salesforce.comhttp://remend.com/

http://www.adp.com/

Software As Service [SaaS]

7Hype cycle Image Ref : http://hmestrum.blogs.com/my_weblog/images/gartner_hype_cycle_curve.jpg

Gartner’s Hype Cycle

SaaS

SOA

WS

Workflow

XML

Software As Service [SaaS]

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SaaS Architecture

Software As Service [SaaS]

SaaS can be implemented as a web service, but need not be a web service…

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nAchieving economy of scale by sharing the resources.

“Software deployed as a hosted service and accessed over the Internet.” From: Architecture Strategies for Catching the Long Tail By Chong & Carraro , Microsoft Corporation

Service provider owns the software.Customer owns the Data.

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Data

Application Framework [Web service Model]

Software As Service [SaaS]

Data Access

Business Logic

Business Facade

Listener /UI

Web S

ervice

Service Request Service Response Get Contract

From : A Roadmap to the Microsoft Platform

CRUD

If Discount = 10% price = price-(price* .10)

Workflow , Rules EngineBizTalk / Web sphere

Traditional API, etc.

Database API,ODBC, JDBC, etc

Oracle , SQL Server, MySQL,DB2etc.

ASP ,PHP, JSP,Web Services,

etc.

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SaaS Database Architecture [Isolate Customer Data == TRUST]

Software As Service [SaaS]

1,2…n

1

2

n

Customercustomer_id

customer_level

customer_is_valid

Customer_Detailscustomer_id

customer_name

customer_address1

customer_address2

customer_city

customer_zip

customer_state

customer_billing_contact

customer_admin_contact

Customer_Usersuser_id

customer_id

user_name

user_pass_iv

user_encrypted_pass...

user_role_id

User_Detailsuser_id

first_name

last_name

employee_id

employee_manager_id

employee_email_idOne Database for all the Customers One Database

Per Customeruse SaaSselect * from customerwhere customer_id = 1and customer_is_valid ='true‘go

use [SaaS.Customer1]select * from customergo

Logical Partitioning Physical Partitioning

This schema is more suitablefor logical partitioning.Think about how will you Manage

Database Connection[s] at app level. Refer to Multi – Tenant Data Architecture from MSDN for additional info.

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SaaS Database Architecture [Isolate Customer Data == TRUST]

Software As Service [SaaS]

Important considerations :Static vs. Dynamic SchemaHow much schema customization is allowed? [i.e. how will you handle the request for additional fields / custom columns]

Encryption RequirementsHaving standard encryption policy will result in better customization. How will You handle a request for storing SSN?

ScalabilityScaling Up vs. Scaling OUT [Same functionality for more users against More functionality for same users ]. What is a Backup / Replication / Fail-Over policy?

Database Size and StorageMinimum and Maximum Database size allowed. [Not a big thing]Storage : SAN , NAS , DAS etc. [SCSI, SAS, and Fiber Channel]

Locking Mechanism / Monitoring and Reporting EnvironmentOptimize locking mechanism and partition data for better performancehttp://trust.salesforce.com/

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SaaS Security Model

Software As Service [SaaS]

Customer – User [username / password]

Customer – Admin[Manage users accounts]

Service Provider – Customer Admin[Mange group of customer accounts]

Service ProviderSubject MatterExperts [SME]

Manage Application modules / application domain

Effective Model:Role base SecurityPartition customer data

Encrypted passwordAuthenticate Once –Authorize on each Web Page

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SaaS Demo Application Framework

Software As Service [SaaS]

Demo will be based on following Technology

•SQl Server 2005 •VS 2005 [ASP.NET 2.0 and C#]• AJAX •HTTP Endpoints / Web Service [http.sys]

Action Plan : Unlock the Value of your Software!

• Create C# assembly for SHA512Managed();• Register the assembly in SQL 2005 [SQL- CLR integration]• Create a T-SQL Function that will utilize SHA512Managed();• Create HTTP Endpoint to tie the Function with authentication Web service• Test the WSDL• Create a Web Application [AJAX enabled using ASP.NET] and add web reference• Add Master Page and AJAX Script Manager and Update Panel• Update web.config• Test the authentication service inside our web application

NO IISNO ADO.NET

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SaaS Challenges

Technical Identifying development platform - .NET / Java / LAMP / Perl etc[ Workday vs Remend]

• Scalable Solution• Role Base Security• 24 * 7 * 375 availability • Database Management / Partitioning • Network Security / Network Neutrality

BusinessIdentifying right business model – Open Source / Proprietary / Shareware [SugerCRM / SalesForce]• Pricing Model [Selling number of concurrent users licenses, pay per use, etc.]• Modules / Features offering• Time to Market• Maintaining Brand Quality and Loyalty• Software purchased in any way other than as a perpetual license is viewed as a

business cost, as opposed to a depreciable capital expense, and must be accounted for on profit-and-loss statements. [source: Supply & Demand: Software Pricing By Jeffrey Rothfeder , e-week issue of February 26, 2004]

Software As Service [SaaS]

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Important Questions?

What is the difference between selling a book or CD over Internet and offeringSoftware Service over Internet? Should service be passive or active?

Will the business model of Amazon or Netflix work for Software vendors? [Likeoffering Operating System on Demand] How to build TRUST in SaaS model? Governance Model for SaaS?

Impact of market forces like competition, barrier to entry and legal framework [patent issues] on SaaS ?

Image Ref : http://www.ngw.nl/int/zwi/s/saas.htm

Software As Service [SaaS]

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Resources :

A. http://msdn2.microsoft.com/en-us/architecture/aa699384.aspx

B. http://www-304.ibm.com/jct09002c/isv/marketing/saas/resources.html

C. http://en.wikipedia.org/wiki/Software_as_a_Service

D. http://www.opsource.net/saas/summit2006/

E. http://en.wikipedia.org/wiki/Long_tail#_note-0

F. Anderson, Chris (2006). The Long Tail: Why the Future of Business is Selling Less of More. Hyperion. ISBN 1-4013-0237-8.

SaaS For Developers : Abhijit Gadkari , Enterprise Architect , AMG-SIU

Software As Service [SaaS]

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If you own copyrights to the information provided and are not mentioned,

please contact Abhijit dot Gadkari at Gmail dot COM

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Software As Service [SaaS]

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