Here’s an interesting factoid: India has more middle-class citizens
than the United States has workers. India, one of the fastest growing
economies, will one day even surpass China in economic strength, and is
building its entire economy of the future on predominantly
white-collar, innovative technology jobs.
But India is still largely a third-world nation. Despite access to
vast amounts of technology and having an abundant of IT talent in its
population, the general India economy subsists on what we would
consider antiquated technologies and applications. Simply put, the
majority of India’s vast sea of small and midsized businesses cannot
afford the applications that we take for granted in the United States
and Western Europe.
Tata Consulting Services is looking to change that equation through
a hybrid of managed services, software as a service and on-premise
hardware. It’s calling it “IT as a service,” or an IT business solution
set in a box. The “set” will contain all the applications and hardware
needed by small business to operate, and it’s provided on an as-need,
as-used pricing model. Providing the remote management capabilities is
Kaseya, a leader in remote monitoring and management and automation
technologies.
The concept of a complete offering has been around for several
years. In 2002, Symantec introduced the first unified threat management
(UTM) appliance – the Security Gateway. In 2007, SAP released its own
complete data analytics in a box solution. And, more recently, IBM
released Cube, a small business appliance that includes e-mail,
calendaring and Intuit financial management.
What separates them from the Tata model is the inclusion of a managed service or a software-as-a-service component.
What Tata is trying to achieve is increasing small business access
to advance technology by decreasing cost. The mix of on-premise
technology with a managed service and flexible pricing might do for the
technology in the small business market what micro-lending did for
entrepreneurs in emerging markets. Tata estimates the market for such
technology in India is close to $10 billion. If the model proves
successful, you can bet that it will find its way to the United States.
“This industry is going to grow up in a hurry,” says Kaseya CEO
Gerald Blackie, who believes more pay-as-you-go computing models will
take over the market. And there’s good reason for it. Software remains
too expensive for the mass market. Too many software licenses go wasted
by businesses who must buy in bulk only to have CDs sit on a shelf. And
applications go underutilized as users rarely tap all of the
functionality.
“We have got to think of ways to make all of this easier,” Blackie says.
We may not have to wait for Tata to prove its model in India or for
IBM to add managed services to its Cube offering. There are already
offerings that are entirely cloud-based that are either rolling up or
rolled up into a virtual IT solution set.
Google recently took the wraps off Wave, a reimagination of
collaboration applications. Google project leader Lars Rasmussen
started the ambition project by asking a simple question: What would
e-mail look like if it were invented today? The result of that question
is a new service that rolls up e-mail, instant messaging, wikis,
blogging, calendaring and social networking into a new, single pane of
glass that’s delivered through the cloud.
Several managed service and software-as-a-service vendors have
started looking at tackling the anticipated problem of “services
sprawl,” or the proliferation of multiple services to the point in
which the cloud-based applications become unmanageable. Vendors such as
Microsoft and Novell are already thinking about ways to bring these
disparate applications under one portal, giving users more control.
Perhaps that meta-portal could look something like the aggregator
applications for social networks, such as TweetDeck for Facebook and
Twitter.
The point is the conventional hardware and software sales models
that have worked well for the technology channel for decades are
breaking down rapidly. Solution providers should study – and perhaps
contribute – to the changing models to ensure they maintain a role in
the services new world order. Otherwise, the IT as a service may not
only replace the data center, but also the solution providers that
support it.
Lawrence M. Walsh is vice president and group publisher of Channel Insider. Read his research reports at [CI] Perspectives.
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