Choose The Right Plan
You signup for one of the many available slabs and the vendor will have an over usage charge, which is normally somewhere in the small print. Typically, charges for using extra will be many times the standard rate. So, when you go for a hosted server, you may signup for a server with 1000 GB per month of data transfer. Any usage above 1000 GB in a month will have an extra charge per GB, and this varies from service provider to service provider.
Let’s take the example of Sproutit, which provides a shared mailroom service and charges US$ 0.05 for every message sent or received above plan limit. So, if you sign up for a personal plan with them (US$ 9 for 500 messages in and out) and just happen to do 900 messages instead, you would end up paying US$ 29 as against the US$ 19 that you would have paid with the next higher plan that covers 1000 messages.
So, with all SaaS signups, it is important that you choose the right plan and monitor your usage as you go along and adjust plans if required.
| Managed Email |
| You have three types of email services out there. Simple mail without any frills, and mail with bells and whistles like shared calendars, public folders, mobile sync, etc. Simple mail (SMTP and POP3) comes fairly cheap. Hosted mail with bells and whistles—the type offered by Microsoft’s Exchange server or Zimbra is costly in comparison. But you will be left to manage the server. Managed email with the bells and whistles (where someone manages your Zimbra or Exchange accounts) is even more costly. Way more costly. |
Service Level Agreements (SLA)
An SLA sets out what level of service availability is being promised and what make good you will get in case the stated service level is not met.
Yawn! Who wants to read boring legalese? However, you will be surprised. Let me give you one recent example. I was negotiating with a leading regional data center for managing emails. Somewhere buried in the middle of the proposal was the SLA and in it were a few gems. How about “Intermittent downtime for a period of less than ten minutes will not be counted towards any downtime periods” or “There will be no more than twelve hours of scheduled downtime in a calendar month.” Give me a break. Scheduled downtime of up to 12 hours a month for an email service? And if the mail is down for nine minutes after every two minutes, that will be fine? Wait. That is not all. “All burnouts are excluded and shall be charged on actual.” Excuse me! You burn your equipment for whatever reason and then want to charge the customers for it? Obviously, this service provider has some serious rework pending on their SLA. Meanwhile, do not be surprised after the fact with what an SLA contains. Give it a look once over before you sign on. At least the known devil is better than the unknown angel!
Look Out For “Other charges”
Many SaaS services run on a sign-on-and-start model. But many like email services have set up fees. But you also come across some fees that are let’s say, unexpected. Take the case of LuitDox, a document management offering. You need to pay them in advance, either for six months or for a year. That may be okay. But every time you make a payment, there is a processing fee of $35!
Salesforce.com will have their partners do some customization of the site to meet your exact requirements. But most customization quotes I have come across have been equal if not more than the annual charge for a small organization. (Such customization charges are of course open to negotiation.)
Integration Issues
One of the problems with opting for multiple SaaS providers is the lack of integration across vendors. Your users will have to login to each of the services separately, using separate passwords and possibly user names. And you would have to create, delete and otherwise administer users at each service separately.
It would have been nice if all services could accept logins using something like OpenID (www.openid.net) or an LDAP-based directory service like the Windows Active Directory Services (ADS). Until that happens, we are left with having to manage a different user name and password at each vendor.
When You Leave
When you leave a service that you were using (and paying for), ensure that you have confirmation from them that your account has indeed been terminated and that you will no longer be charged. Else, you may have the unpleasant experience of your credit card being charged even when you are no longer using the service.
Can You Convert Your Vendor into a SaaS Model?
Finally, if you cannot find a hosted model, can you make your selected vendor offer a pay-as-you-use model?
We were negotiating for the implementation of a new HR system. And the final question we had of the shortlisted vendor was whether he would implement it at a data center of his choice and manage it for us, against monthly payments instead of an upfront payment plus annual maintenance charges. The first reaction was one of incredulity. But a month of cajoling with an assurance of a three year contract and a year’s payment as advance cheques helped them to agree to the deal. For us, a huge one-time payment got converted into more comfortable monthly payouts, and we did not have to bother about having to manage the backend.
The funny part is that today, they sell a hosted model based around what we cajoled them into doing just for us, and I am not getting anything for the idea!
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written by M A J Jeyaseelan, May 21, 2009
The cost of using any software is therefore not limited to the price paid for the software or its use. In reality, the infrastructure required for using enterprise software accounts for a major part of the software usage cost
It becomes therefore very necessary to go for software packages that do not require heavy usage costs. It is possible to significantly reduce software usage costs by adopting architectural innovations in its development.
Some of the key contributors high software usage costs include 1) Lack of standardization and parametrization of data elements. With standardized and parametrized data, there would be less human resources required for data reporting and analysis, 2) Lack of decentralized data acquisition facilities. Most enterprise systems require that all data entry is done on the central systems. This process involves huge bandwidth consumption for transfer of GUI that are part of the data entry forms, while the size of the actual data entered may be very minuscule. 3) Lack of enterprise integration. Although data migration is no more a huge problem, many enterprises are still using disparate systems requiring enterprise integration software. Instead, integrated enterprise solutions could easily cut down usage costs significantly.
Ultimately, the architecture of enterprise applications and back end databases have a very significant bearing on software usage costs. Unfortunately, most of the big vendors are still persisting with outdated architectures as they are also mighty afraid of redevelopment costs.
If you intend cutting down over all IT costs, look for innovative solutions, that can significantly deliver results with less infrastructure and maintenance costs
written by M A J Jeyaseelan, May 21, 2009
We have already developed a database integrated mailing and messaging system that helps monitor and analyze the content of mails and messages with the help of in built parameters
This system also enables data interchange through such mail boxes. In a typical case, if you would like to transmit a report to your superior, you would be just sending a URL with a few attached parameters and the report can be viewed by the recipient dynamically. There is no document transmission. This eliminates high bandwidth use
However, we provide these solutions only to users who decide to switch over to our enterprise database architecture.
Still, we would like to point out that there is lot more to be gained by moving away from dumb mail applications and instead using a database based mailing and messaging model
written by Sahil, November 21, 2008
written by Gopal Shivapuja, November 06, 2008
SaaS is definitely a worthwhile choice that one should consider before making any large capital investments, as we can see that most solutions are already available and there is no need to re-invent the wheel.
Gopal Shivapuja
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Quick setup, low cost (often free) and maintenance free, the SaaS model is fantastic in helping low investment business get decent tools.
Just be careful who you get the service from. Make sure they operate a secure environment and that they take data privacy very seriously.