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NetSuite Touts Total Cost of Ownership StudyBy DAVID SIMS TMCnet CRM Alert Columnist NetSuite touts their own TCO compared to SalesLogix and MAS 90. NetSuite Inc., a provider of on-demand business software suites is proud of the fact that according to a new total cost of ownership study by Boston-based industry watcher Yankee Group, the companys on-demand NetSuite offering was significantly less expensive over a three and five year period when compared to a combination of SalesLogix and MAS 90, according to NetSuite officials. Both SalesLogix and MAS 90 are owned by Best Software, part of the Sage Group. In one comparison, NetSuites TCO was less than half the cost of Bests on-premise combination. The study itself notes that on-demand solutions include implementation, maintenance, training, support and application management services delivered by the application vendor directly and may be augmented by a channel partner that provides integration and customization services and on-site hand-holding to enable a quick and productive ramp-up. The end user accesses the applications through a web browser and pays a monthly per-user cost. The study authors cautioned against vendors offering a hosted solution in partnership with a VAR with a disguised monthly subscription fee that includes license, maintenance, and implementation and customization charges, and at the end of the term, customers own the application licenses, which it called more like a financed on-premises solution. The study lists some of the advantages of on-demand products as faster implementation and ramp-up time to productive use of applications, lower upfront and ongoing costs and no additional IT infrastructure for servers, networks, and storage and IT resources to support them. Disadvantages include the fact they require the availability of broadband internet service at customer location, theyre difficult to implement if lots of upfront customization is required and applications need to support a service-oriented architecture and web services integration model to deploy and deliver good performance NetSuite officials attribute its all-in-one application design and on-demand delivery model for the majority of the significant cost savings uncovered in the study. Unlike companies such as Best Software and Microsoft who have spent millions even billions of dollars buying CRM and ERP applications, and then asking customers to patch them together, company officials say, NetSuite was designed to be a single integrated application spanning front-office, back-office and eCommerce. Unflattering comparisons to Microsoft have you guessed that NetSuites founding in 1998 was bankrolled by Oracles Larry Ellison, or that its founder, Evan Goldberg, is one of Ellisons fair-haired boys? According to information provided by The Yankee Group study, written by Sanjeev Aggarwal, Small & Medium Business Strategies Senior Analyst, concluded, The TCO for on-demand solutions is much better than that of traditional on-premises solutions even when evaluated over a three to five year period. On-premises solutions require significant investments in IT infrastructure and application deployment, support and update resources. Originally targeted to small businesses as an inexpensive competitor to QuickBooks, its now aimed at mid-market companies, jostling with Microsofts Great Plains, Microsoft CRM, ACCPAC, salesforce.com and Siebel for customers, according to CRM Daily. ----- David Sims is contributing editor for TMCnet. For more articles by David Sims, please visit: http://www.tmcnet.com/tmcnet/columnists/columnist.aspx?id=100005&nm=David%20 Sims |