Comments on: SaaS Channels | Cloud Channels Will Follow the MoneyThe emerging PaaS channel opportunity

By: Cloud Channel Disruption – Little APIs, Big Transformations

Cloud Channel Disruption – Little APIs, Big Transformations — Fri, 17 Sep 2010 01:46:45 +0000

[...] Stanek, CEO of GoodData, and he coolly pointed out that the solution was right in front of my face: the cloud is the channel. The GoodData BI PaaS platform, puts APIs ahead of BI and cheats the adoption cost barrier outright [...]

By: Hey SaaS Experts: What’s Your Cloud Computing IQ?

Hey SaaS Experts: What’s Your Cloud Computing IQ? — Tue, 14 Sep 2010 12:25:42 +0000

[...] for me by some of the reactions of my fellow SaaS evangelists to this recent post of the emerging PaaS channel opportunity. As if the emergence of the PaaS channel somehow devalues the “pure” SaaS channel. This is not [...]

By: Andrew Slater

Andrew Slater — Fri, 14 May 2010 18:49:50 +0000

Joel – Your article is bang on. I hope you don’t mind but I’ve referenced it in one of my recent blog posts http://as-a-service.blogspot.com/2010/05/emergence-of-cloud-managed-service.html

Cheers,
Andy

By: C R Rao

C R Rao — Tue, 11 May 2010 15:02:20 +0000

I agree with Joe and Joel in that there may be opportunity in both models. At the moment there’s no money even for the resellers of PaaS that we talk to. Joel mentioned Force.com and Amazon Wen Services in one of his posts. We went looking around for a successful reseller of Force.com and for all the noise that salesforce makes, we couldn’t find a single one that has even sold a thousand seats. Mind you, 1000 seats may only equal roughly a million or less dollars worth of yearly revenues. The reason most of them cited was that salesforce doesn’t really let them go after any deals. The only way these resellers survive with salesforce seems to be to sell consulting work and let salesforce sell their seats directly. Or in other words, by not being resellers. We also talked to a bunch of Amazon resellers and they still seemed to be struggling to go “live.” I’m also not sure if Amazon is a full fledged development platform, it seems more like infrastructure to me.

So in reality, yes, there is potential in saas and paas models but it has less to do with what the saas or paas provider offers or with what your “value add” is. It has to do more with whether the saas or paas provider has figured out how to make you successful as a reseller and really sees that as crucial to their business model. It has to do with whether you can really resell whatever you are reselling or you are just being tricked.

By: Joe Hanna

Joe Hanna — Mon, 10 May 2010 16:56:36 +0000

I agree with you that there has to be a way for the channel to “make money” for their participation to make sense; however, “making money” comes in different shapes and forms. SaaS vendors have to tailor a value prop for each kind of channel. What motivates a reseller to participate is different from what motivates a complementary product vendor, a consulting/implementation company, a platform vendor, a content vendor, or an OEM target, etc. The trick for business developers is crafting that unique value prop for each channel. At its heart, this is no different from traditional software models.

The general maturity of the SaaS model plays an important role here as well. The typical SaaS company focuses first on creating a product and attracting traffic, etc. then turn their focus to channels at a later stage. A lot of SaaS companies are approaching that stage now where heavy focus on channels and business development is overdue. As the issue gets the appropriate focus from smart brains, we will see the evolution of a number of successful models that the ecosystem will congregate around and expect.

So, don’t give up on being a channel for a SaaS company yet … just figure out the “Value Add” in your VAR relationship and the rest will fall in place!!