Will Cloud computing providers face competition from On Premise?
Posted by John Biggs on Thu, Nov 18, 2010
The simple answer is yes but in the case of Microsoft CRM Online, it may need a little discussion to understand why.
- Data Location
- Connectivity
- Access to Backups
- Windows Live
- Reporting API
- Cost to Change
Data Location
In its infancy the Microsoft Dynamics CRM Online service will be concentrated on a few strategic data centres. For New Zealand as with Australia this will be set in Singapore with back up over to Hong Kong. I have no doubt that this will expand out to local countries where the demand is high enough. So in the long term Data Location will not cause issues.
Connectivity
This may cause a challenge, for example for cloud CRM to connect to on premise ERP, but there is good growth in the integration tools getting into the cloud. We have a client who uses partner hosted Microsoft Dynamics CRM in New Zealand, Mail hosted in Singapore and Microsoft Outlook on the desktop. All three talk to each other seamlessly and the user would not know where they are hosted.
Access to Backups
Backups are a little harder to access for hosted applications than when they are stored in the office or even online. This will get better but if you rely on backups a lot you may get frustrated.
Windows Live
Users need to have a Microosft Windows Live login to access Microsoft Dynamics CRM Online. To some this is an issue and Microsoft plan to change that requirement but at present it can be a problem.
Reporting API
The reporting engine is hosted on premise with CRM on premise. This provides the user greater flexibility around some advanced features of Sequel Reporting Services including scheduling the report. Cloud suppliers may not be prepared to give multiple customers the same access to the on line Report Engine.
Cost to Change
While there are financial benefits for cloud based applications if a company starts from scratch, for a company already using say Microsoft Dynamics CRM software and paying only Software Assurance it can work out cheaper. At present Software assurance is about $229 per year or $19 a month. Yes, there is always the server replacement cost to consider as well.
Despite the Cloud hype there will be people who prefer Microsoft Dynamics CRM implementation on premise for any of the reasons above or the reverse may apply where people find Hosted Microsoft Dynamics CRM a better option.