Companies such as Google Inc., NetSuite Inc. and Salesforce.com Inc. offer on-demand, vendor-hosted Software as a Service (SaaS). Products range from office productivity wares to enterprise applications. But for service and solution providers, the cloud provides more than an application set. Those players can tap vendor-provided development tools, hosting infrastructure, storage and data center capacity.
While partners fear disintermediation -- many say the model shifts account control from third-party service providers to the vendor/host -- the cloud providers invite channel interaction. Partners can resell Software as a Service solutions or customize a solution for a given customer segment. They can also wrap services around the on-demand offerings: up-front business consulting, implementation assistance, systems integration with existing systems, and post-implementation support.
Daston Corp.'s path to partnership started when the company tapped NetSuite to provide an array of business applications: customer relationship management (CRM), finance, human resources and payroll. The McLean, Va.-based professional services firm is a federal contractor that must operate in accordance with the Defense Contract Audit Agency (DCAA) requirements. Daston modified NetSuite to meet the compliance demand.
Now the company sells its instance of NetSuite -- dubbed DCAA On-Demand -- to other government contractors as a prepackaged solution, said Greg Callen, senior vice president at Daston. The company offers consulting and implementation support services as well.
"We've developed a whole business line around a NetSuite practice," he said.
Appirio Inc., meanwhile, has built its entire business around accelerating the adoption of on-demand software. The San Mateo, Calif., company's services lineup includes strategy, implementation and education. Appirio partners in the cloud with Google and Salesforce.com.
Appirio leverages Salesforce.com's cloud to develop custom applications for such clients as CRC Health Group, a provider of drug and alcohol treatment services. The company has also built a Salesforce.com-based professional services automation solution that it plans to release in the next two to three months, said Narinder Singh, founder of Appirio.
Cloud computing as development environment
On the custom development side, channel partners take advantage of the platform cloud providers offer.
Salesforce.com, for example, contributes its Force.com platform, which includes "point-and-click" tools for some levels of customization and a programming language called Apex.
Singh said his company uses the point-and-click tools to accomplish such tasks as creating workflows and employs Apex for more advanced chores.
Model Metrics LLC, a Chicago-based on-demand CRM consulting firm, uses Force.com's Visualforce, a tool for designing application user interfaces. Customers want to see something very specialized when they sign into Salesforce.com, said Adam Caplan, president of Model Metrics.
"We present them with a custom interface [that] can be mobile or online," he noted.
In some cases, Model Metrics employs both development tools native to Force.com and third-party products. Model Metrics' 2GO platform, which creates custom solutions for mobile sales reps and field service teams, takes advantage of Force.com, Adobe Flex and Adobe AIR, according to the company.
NetSuite, meanwhile, positions its NetSuite Business Operating System as an application development platform. It includes SuiteFlex, which covers development, customization, integration and business process automation. SuiteBundler technology lets channel allies package a piece of custom functionality as a replicable solution.
Callen said Daston uses SuiteFlex for development and SuiteBundler to put together its DCAA solution.
Beyond development, infrastructure is also part of the platform mix and that includes hosting and storage services. Applications developed on NetSuite, for instance, will be hosted on the company's Software as a Service infrastructure.
Force.com lets developers offer their applications through Salesforce.com's AppExchange application-sharing service. In addition, Amazon.com's Elastic Compute Cloud offers computing capacity in the cloud. Similarly, the company's Simple Storage Service provides storage.
Faster turnaround time on projects is a key benefit of using cloud-based development tools and infrastructure, executives said.
Traditional projects involve "a lot of time spent on low-level testing and infrastructure installation," Singh explained. He said Salesforce.com projects tend to be shorter in duration and more iterative. A prototype can be built in two to three weeks and the entire project may run eight to 15 weeks or so, he added.
The on-demand ecosystem
Channel players aim to offer customers an ecosystem of compatible on-demand products.
Daston, Callen said, will focus on NetSuite as its core solution, avoiding the use of competing products. But the company may package complementary products under the SaaS umbrella. The concept would involve offering "a suite of complementary solutions with NetSuite as the base" for CRM and enterprise resource planning (ERP) applications.
Singh said on-demand offerings differ markedly, a partnering situation Appirio seeks to navigate.
"We look at Amazon as very different from Salesforce," he said. "It's focused on the … opposite end of the spectrum," he added, noting that the company pursues resource-intensive items such as CPUs and storage.
Singh said Appirio looks for opportunities where different on-demand offerings are complementary and may be connected together.