NetSuite CEO - Cloud vs On-Premise apps battle is won
- 20 October, 2009 12:48
- Comments 7
The ability to customise cloud-based applications will be the reason companies abandon on-premise applications, according to NetSuite CEO, Zach Nelson.
Talking at a media event in Sydney, Nelson claimed on-premise vendors were holding on to the argument cloud applications are not as customisable as on-premise applications such as SAP or Microsoft’s Great Plains.
“In fact not only is that not true, but ultimately the degree of customisability of cloud-based applications becomes the winning argument as to why everyone will move to the cloud,” Nelson said.
“These applications are far more customisable than traditional applications ever were, for two reasons. One, they have been built on modern technology – they were built after the Internet existed – so things that were really complex to do in traditional software become trivial in [a cloud] application.”
Nelson said the other important factor in favour of cloud applications was the ability for customers to migrate their customisations.
“The problem with today’s applications – and you will hear this from customers – is they are all version locked,” Nelson claimed. “They don’t want to move because they are afraid that it will collapse and break down.”
Nelson claimed NetSuite had upgraded its software more than 400 times in the last year without the loss of a customer’s customisation.
The CEO also said NetSuite was considering building a data centre in the region – it runs its global operations out of Sunnyvale, California – but said that this was not motivated by customer concerns over having their data based locally.
“There is a psychological impact [about having data centres and data in their own country] but what they really care about is the availability of the data, the security of the data and the performance of the application,” he said. “In all of those cases when we moved the DC back to the States we didn’t see any changes. At some point we may come back and build an Asian DC.”
NetSuite previously ran a data centre in Australia via its distributor NetReturn, which it acquired last year. It later closed the data centre and moved the data to its US data centre.
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Comments
Mark A
Sure, cloud computing may be more customisable, but what's the good of that when a contractor forgets to dial before they dig, cutting through an internet backbone fibre (as has happenned repeatedly recently), causing a whole state to lose net access?
On premesis software will still work, and there'd be no need to shut the WHOLE office just because the internet is down.
This seems to be an aspect that no one wants to think about?
Steve Hodgkinson
True enough ... cloud applications depend on internet access. This becomes a factor to be managed - it is not a universal argument in favour of on-premises IT. Businesses are becoming more and more reliant on internet access (cloud computing or not) in the same way that they are reliant on the electricity grid. As cloud computing matures so to does the thinking around business continuity for cloud services. The trick is always to have a Plan B for mission critical services ... but even so there will be occasional disasters that just need to be toughed out.
Anonymous
I would disagree with the above two comments. You both sound like you have experience in the workplace with internet going down and affecting operations and productivity, however, eventually as technology improves and time goes on there will be almost infallible redundancy solutions.
As to the article above, I think it overstates the potential of NetSuites 'cloud-based applications'. Premise based applications can almost as easily have manageable customizations and perform the same duty in a similar way.
Camm
Until universal fibre to the home, as well as cheaper costs for data come into play, cloud based services will only be kept for such things as the roadwarriors and satellite offices. Everything else at worst (best?) will simply be kept on company servers, locally serving applications.
Anonymous
Er, was that 400 upgrades or 400 bug-fixes?
Margaret Barker
We trialled Netsuite about 2 years ago and the system kept logging us out. That was enough to make us decide to stick with our on premises legacy apps. Then again perhaps one of the 400 upgrades managed to fix that "feature".
Rick
We looked at in house apps, SAP, Oracle, Tech One etc and the cost to setup was massive compared to NS. Is it painful? Yes. However so is every large ERP app. NS worked and are still working with us as I speak to help make it work. I am sure 2 years ago there were issues but now it is fully functional product that we can change new forms (no cost) we design and implement tabs (no cost) delete fields, add fields, lists, import data, export data, customer backend access, (no cost) for me as an IT professional and MD of a IT company COME ON CLOUD!!!!!!! No computer, no power bill now down time and that comment about fibre links, this product is faster than in our inhouse apps and I can login ANYWHERE in the world from a browser.
NetSuite has its issues but like any product you work through them and they work out. Good product and I agree with Zach
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