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A Winning Combination: Software-as-Services Plus Business Consulting and Process Services
By Laurie McCabe
January 30, 2004

Goldberg said much of the success of NetSuite actually belongs to Zach Nelson, the company’s CEO and also a former Oracle VP who came onboard in 2002 and immediately, along with Ellison, began rebuilding the company’s identity.

And now that IT budgets are loosening, Goldberg sees a bright future for what was once known as the ASP industry. But, today, while the whole idea of hosted software delivered remotely is the vision of Ellison and many others, it will be the specialty ISVs that take fullest advantage of the “on-demand” model, predicts Goldberg.

“It’s more difficult for an (ISV) with a legacy of client/server delivery to move to this approach,” said Goldberg. “The desktop-delivered applications will be limited to the ones that need the horsepower and graphical capabilities of a Windows desktop application. So things like CAD, it will be a long time before those types of applications are Web-delivered. But a typical application that has a standard interface of forms. Those applications are really going to be rapidly moving to the Web-based approach.”

The next step for the company is to become consistently cash-flow positive. Right now, some months are and some months aren’t. But, if Goldberg and Ellison are right and software ultimately becomes a deliverable instead of a package buy, it could be sooner rather than later. But there is a long road between here and there. Even Goldberg admits legacy apps have a funny way of sticking around.

“Definitely, it’s a line-of-business sale,” said Goldberg. “But we see the CIOs and the heads of IT being on our side and being advocates for us within the company. If I would say what the biggest barrier we see in companies is, generally they have an entrenched application already for doing their finance.”


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