“Everyone today believes that they need to try out the Cloud,” argues Informatica CEO Sohaib Abbasi. “That wasn't the case a year ago. Now everyone believes that they need to understand what Cloud Computing is all about. They're setting out to try it out with their non-critical applications. They need to be in a better position to be able to leverage it fully at a later date. One of the key hurdles that they need to overcome is how retain control over your data. For that reason, as customers start to experiment with Cloud Computing, they need to have Cloud data integration capabilities.
“That's becoming a necessity for them and it's an opportunity for us,” he explains. “We see three main opportunities for growth. Firstly, we want to be the partner of choice for the new breed of Cloud vendors and to that end we've signed two dozen partnership deals. Secondly, we want to extend our platforms out to new data sources in the Cloud. Thirdly, we want to use Cloud Computing to deliver Integration as a Service.”
Some firms, most notably SAP, have voiced concern about the potential cannibalisation of existing revenue streams through a move to the Cloud. Abbasi takes a pragmatic stance on this subject. “SAP is, I think, somewhat conflicted here as they have a lot to lose. If there is a rapid shift to Cloud Computing, they have a problem because the economics and the business model are so different. The Cloud does have an impact on the traditional business model. It's that which has been partly influencing some of the statements made by the likes of Larry Ellison. Some of those industry leaders are not as supportive of Cloud Computing because of what it represents to the traditional business.
“The issue is one of the business model. Oracle was actually one of the first companies to have a product in the Cloud Computing or on demand market. But the challenge they faced was how to build a business model that ends up with the right mix of business and striking that balance becomes a significant consideration. Oracle is actually a good example of an organisation that appreciates the implications of moving to the Cloud. Larry Ellison understands the Cloud – he's the biggest single investor in NetSuite – but politically his statements have to be worded carefully.
“We don't have such a conflict. In fact the Cloud opens up a new opportunity for us. There are no conflicts with our existing business. Those silo of on premise data that are out there are just not going to be going away any time soon. In fact, new silos are being created. We see the Cloud as representing a new wave of data fragmentation and from that point of view it's a whole new wave of opportunity for us.
“We have the flexibility of deploying our flagship product in the Cloud or on premises. Customers who are thinking of leveraging Amazon EC2 can now integrate with a data integration platform closer to the data itself. We have also announced pricing that is consistent with Cloud Computing so that customers can leverage PowerCenter using an hourly subscription fee.”
But is there money to be made in the Cloud yet? “We have yet to see a significant impact on our business, but the indirect impact is very signficant. We have won several large transactions where our Cloud Computing offering was a contributing factor in the decision,” says Abbasi. “But we now have several hundred customers using Informatica On Demand. We are able to integrate off premises data managed by Salesforce.com with on premises data. We have introduced new data as a service integrations. We continue to be the only vendor that offers Integration as a Service.”
To date most of that integration effort is focused on pulling together on and off premise data, but there are signs of shift to a new phase. “We are beginning to see some demand for Cloud to Cloud integration, but it's not that common yet,” says Abbasi. “The most common case is companies wanting to take data from an on premise system and then on-board it to a SaaS system. Can they keep control of that data in the Cloud or make a replica on premises. We have demo-ed Cloud to Cloud integration. We have demonstrated taking data from Salesforce.com and putting it into a Google Apps spreadsheet.”
