automation as a competitive adv - no notes

May 19-20 l Washington, DC l Omni Shoreham

Automation as a Competitive Advantage

Jan-Jaap Jager

Managing Director - Asia / MEA , Parallels

[email protected]

Automation As A Competitive Advantage2

Agenda

• What has happened / is happening…

• How to keep Competitive

• Automation the Secret to Success

• How can Parallels Help


What has happened / is happening…

OPPORTUNITY


Hosting Industry • Industry continues to mature

– Seen as a serious business

• Market Consolidation– Leaders are buying followers/ close competitors

– Leaders are buying smaller companies

• SaaS is not futuristic, it exists today– Was and will be even more of a growth driver

– Plenty of room for all hosting types

– Threat and opportunity

• Larger ISVs see the need to move to SaaS as well– SaaS is SOFTWARE as a service. They are important partners if

you are to take advantage of SaaS opportunity

– Does it make sense for ISV to be a Service Provider?


ISV / SI

ISV Applikation

Actual Market Situation


ISV Application

ISV Application

ISV ApplicationISV Application

ISV Application

ISV Application

ISV / SI

Actual Market Situation


ISV Applikation

ISV Applikation

ISV

SaaS ISV Appl.

Market Trend


Hosting Market: Look ahead• Hosting market grew to $8.2B in 2006 (from $6.8B in 2005)*

• US Market – represents only 50-60% of worldwide market

• By 2011, the market is predicted to grow to $16.4B*Revenue By Service Type, 2006*

Complex Managed Hosting

58%

Dedicated5%

Shared & Virtual Private Server20%

Colocation17%

• Trend #1: Traditional hosting market is established and growing, but slowing down

• Trend #2: Managed hosting and SaaS are the growing segments*

• Key Point: Changes may be required to sustain revenues and continue growth

* source: IDC presentation at 2007 Parallels Hosting Summit

SaaS % of Business Software MarketOpportunity: $8B increasing to $40B

0%

5%

10%

15%

20%

25%

2006 2011



Parallels Summit 20089

OPPORTUNITY GIANTS


Applications

Google productivity tools for small and medium sized businesses.

Internet Giant – Google • Google targeting SMBs with SaaS

– Google Sites (collaboration)

– Google Apps (productivity tools)

Collaboration Screen Images

Competitor to providers offering Hosted SharePoint services.

Apps Hosting

Note that Google’s service offering is starting to resemble website hosting.


Targeting DevelopersComplex usage-based fees which are not understood by typical SMBs.

Internet Giant – Amazon (and others) • Amazon Web Services?

– S3 – Amazon Simple Storage Service

– EC2 – Amazon Elastic Computer Cloud

• WebStores targets merchants

Home Page Screen Images

Found Web Services after scrolling down (not in the main departments).

WebStores

Compete with e-commerce offerings - $60/month plus 7%.


Workspace

Online file sharing for office applications. “may include advertising”

Internet Giant – Microsoft • Microsoft targeting SMBs with SaaS

– Exchange Hosted Services (recent announcement)– Workspace (file sharing for office applications) – Small business (web site and domain tools)

Email Screen Images

New offer is targeted at SMBs as well as large providers.

Small Business

Template-based websites with branded email and shared workspace.• Microsoft is partnering with ISVs and hosting providers

– Take advantage of the opportunity


Other Bigger Industry Players – like…



OPPORTUNITY GIANTS

PRICE EROSION


Hosting Services Price Development

E-Mail ASP.NET &.NET Services

E-CommerceInitial Presence

Added Value Applications

Average Revenue Per User

$2 - $10

$500 - $1,500

$150 - $500

$10 - $150Shared Website, static pages

Shared VPSDedicated VPS

Shared, dynamic Website

Demand for Services Managed

Dedicated Environment with Web Servers), DB, Storage, Security, etc.

Dedicated Web Server with Root Access

ARPU/S opportunities:Shared to VPS to Dedicated

New SaaS Applications


Effect of Price Erosion

Your Premium Customers

$ / Customer

# of Customers

Your Typical Customers

(Currently) “non addressable” Customers

What if you:

(A) Lower your cost of sale (i.e. lower barrier to entry)

(B) Lower cost of operations

Cost

IT Optimization and Automation


What has happened/ is happening…

PRICE EROSION

GIANTSOPPORTUNITY

CHALLENGES


Typical Challenges• Managing Costs

– Hosters are growing – problem is, costs are growing at the same speed

– Must have economies of Scale

• Managing Complexity– The bigger the infrastructure the more complex the management, especially when no

good management automation is in place

• Scalability to answer your growth– Can your platform automatically grow with your customer growth?

– Horizontal and vertical?

– Can you offer new services effectively and efficiently?

• Business Intelligence– Do you actually know your customers?

– Know what kind of services they like? what they don’t like?

– What is your churn rate and why are they leaving?

– What is your up-selling ratio and for which services?

– Which marketing plan is successful and which are not?

• Flexibility– Up sell, cross sell, upgrade, management

– Can the change be done by the customer it self (its better for the customer and you!)


Typical Challenges• Complete solution

– for installation/configuration, upgrade/downgrade & management/monitoring

• Single Sign On– Does your customer have one single interface where they can logon to see and

manage all services themselves?

– Able to add new applications in the same single sign on concept?

• Billing Automation– Payment Collection

– Maintaining Customer Information

– Maintenance product catalog and pricing

– Quickly deploy price changes in your billing system, online store and for your resellers

• Service‘s are like Islands– Different services, platforms, logins, invoices, etc.

• Provisioning complex applications services– Are Configuration and Deployment automated?


Agenda

• What has happened/ is happening…

• How to stay Competitive




How to stay competitive• Pricing

– Must be Low enough to attract customers and high enough to be Profitable

• Business Operations– Be paranoid about efficiency by elimination of manual

processes– Full Automation and Self Management are key

• Broader Set Service Plans– Many & variety of services– Many & variety of applications– Give the customer a choice

• Better & flexible upgrade path– Variety of workloads– Variety of sizing options– Automatic upgrades

How To Achieve This? • Virtualization & Automation

– Helps for additional efficiency and flexibility

– Remember to be paranoid about efficiency

• Business Automation – Automate every aspect of your business and system processes

– Must be fully integrated across all customers, partners and service plans – it is so for the GIANTS!

• Focus– Maximize opportunities based on your Strengths

– Where you could differentiate and cooperate, do so

– Separately we lose, only cooperating we could win

– Standards like APS Standard are required

• Have Optimized Infrastructure– Automate, Virtualize and Standardize



Agenda






Secret to Success

24

Enabling your Business

HostingBusiness

Automation

Service&

Support

Marketing &

3 P’s

Operations &

Finance

Marketing Good Products Good Pricing Good Promotion

Service & Support Efficient Meets customer expectations

Operations & Finance Process Driven

Enabling Technology Rapid deployment of services 100% automated Scalable

Automation is the main contributor to the value of ALL your services.

Not automated = Not offered


Agenda






Standardsprovide automatedapplication delivery

SaaS Enabled!

Control Panelshelp to

Contain Costsand

Grow RevenueHigh Cost

Hard to Grow

Manual Hosting

Parallels Vision – Automation

Cost of Service Delivery

Sca

lab

ilit

y an

d N

ew S

ervi

ce C

reat

ion

(re

ven

ue

op

po

rtu

nit

y)

Service delivery Semi

Service management Manual

Service creation Manual

Simple Hosting

Service delivery Auto

Service management Semi

Service creation Manual

Optimized Hosting

Service delivery Auto

Service management Auto

Service creation Auto

high cost low cost


Parallels Automation Overview

Parallels Virtual AutomationPowerful tool helping administrators manage their virtual infrastructure

Parallels Operations AutomationSolution for automating key IT processes and providing delegated management through the organization

Parallels Business AutomationSolution for automating key IT business functions including service ordering and chargeback accounting


Top 10 Reasons for Parallels Automation1. Lowers your cost of operations and cost of sales

– By automation of service provisioning, management and billing

2. Enables you to offer any kind of ISV application within a SaaS concept

– Through one single service delivery platform

3. Enable quick time to market– Offer any ISV application as a SaaS model within 30 days in a complete

automated provisioning and billing hosted solution

4. Highly scalable solution – Manage millions of accounts

– It can be deployed in clustered and load-balanced configurations

– Supporting mission-critical services on a high-level

5. Completely Customizable to your needs– Wide range of APIs and SDKs available


Top 10 Reasons for Parallels Automation6. Central Business Intelligence/ Billing/ Ordering system

– seamlessly integrates into your website and internal systems

– gives you unique visibility into performance of your business - growth, profitability, churn, up-sell and cross sell effectiveness, etc

7. Unlimited reseller and white label capabilities – Resellers can build their own stores, manage their own pricing, and

manage their own customers. Without limits

8. Proven solution – 500+ deployments worldwide

9. Allows you to concentrate on what you do best – sell hosting services

– Leave software development to us (largest dev team in the industry)

– 300+ developers and engineers working on Parallels Automation

10. Don’t reinvent the wheel we have already done it for you


Summary

PARANOID

CUSTOMER SATISFACTION

REVENUE & PROFITABILITY

DON‘T REINVENT THE WHEEL


Don‘t try to be Albert Einstein by yourself…

… he was already crazy enough…

…take advantage of the Parallels Automation Einstein's

Thank You

Let us have a discussion now how we can help YOU as well…

[email protected]

automation as a competitive adv - no notes

Documents

competitive automation

competitive advantage

advantage of saas opportunity

market trend automation

agenda automation

domain tools automation

good management automation

traditional hosting