Cloud Computing: Small, Big Players Cooperate

Legacy software vendors are inking cloud computing contracts with a new generation of nimble, web-oriented service providers.
The rapid growth of Cloud Computing has inspired various prognostications regarding a looming battle between the legacy hardware and software vendors of the past and a new generation of more nimble, web-oriented service providers.

While there is no question that the competition between these two camps is intensifying, we are also seeing a widening array of cooperative agreements between them as well, which bodes well for organizations seeking to take advantage of cloud-based services without fully forgoing their existing systems and software.

There are a growing number of examples of legacy vendors teaming with cloud computing companies to deliver additional services to their customers.

For instance, a number of on-premise software vendors are teaming with Amazon Web Services (AWS) so they can offer hosted versions of their applications to customers who no longer want to operate the applications in-house.

Last March, Lawson Software announced it would begin offering its core Enterprise Management Systems and Talent Management suite via the Amazon Elastic Compute Cloud (Amazon EC2) infrastructure, as a part of a new Lawson Cloud Services portfolio.

This partnership is a win-win-win situation.

Lawson’s Cloud Services gives midsize organizations a more flexible and economical option to obtain full-function enterprise software. By leveraging the Amazon EC2 Services, Lawson avoided building its own hosting facilities and was able to bring the new services to market quicker, reducing its costs while keeping pace with the accelerating competition.

And Amazon gained greater credibility as a provider of secure, reliable and scalable infrastructure services by winning a contract with Lawson, whose CEO has publicly ridiculed the viability of the Software-as-a-Service (SaaS) idea in the past.

SAP is also teaming with AWS to extend the reach of its BusinessObjects OnDemand solutions. Users of this joint offering can integrate BusinessObjects’ Crystal Reports Query, Reporting and Analysis functionality into their operations or third-party solutions. They can also connect to virtually any data source -- structured and unstructured -- using SAP’s full set of SDKs and APIs to integrate with their applications.

IBM is even teaming with Amazon to enable users to employ Amazon EC2 to support various IBM platform technologies. Under this joint program, customers can use IBM licenses and leverage IBM Development AMIs on Amazon EC2.

All of these arrangements, and many others, are expanding the number of options available to customers. Moving to the cloud is no longer an ‘either/or’ proposition in which corporate decision-makers must make tough choices between their existing vendors and a new set of cloud service providers.

Now, moving to the cloud no longer means moving away from your preferred vendors. Instead, they are finding new ways to remain relevant in the new world of the cloud. However, in some cases it may mean that you’re not necessarily reaping all the benefits of a pure-cloud service. The enterprise software offerings, like Lawson’s, are really modern versions of the old Application Service Provider (ASP) idea, which isn’t as scalable as true, multitenant SaaS solutions.

Nonetheless, if these joint programs enable customers to take their first steps toward the ‘cloud’ with greater confidence and a higher likelihood of success, it can only help to cement and accelerate the overall industry shift toward cloud computing alternatives.

Jeff Kaplan is Managing Director of THINKstrategies (, an independent consulting firm focused on the business implications of the on-demand services movement. He is also the founder of the SaaS Showplace ( He can be reached at

Tags: cloud computing, AWS, Cloud, SaaS, SAP

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