The Blog

  • August 18, 2016
  • Platform as a Platform (PaaP)

    Denis-PombriantThe platform land rush is definitely on. You can’t swing a dead cat, as the saying goes, without finding an announcement about some new platform or some established vendor’s attempt to enhance its existing platform. Some sorting out seems to be in order.

    What’s not a platform these days?

    Well, if you can easily substitute the word application for platform, then use application because it will be more accurate. We’re suffering from word inflation all over the place and application has been split into apps, those things you run on your phone, and applications which vendors shy from preferring platform when they should know better. For the record, an app is still and application and a platform should be more. A lot more.

    Platforms don’t grow on trees.

    Building a platform takes work. It is doubtful to me that you can declare a platform into existence as a startup. Chances are good that a new platform is really a standalone application whose investors don’t want to see it become orphaned. But platforms take time and effort to build. If you look at the majors—Oracle, Microsoft, Salesforce, and SAP, they’ve been in the business for decades acquiring and integrating solutions to make something with a large footprint that they call a platform.

    But it’s not just about quantity of functionality, there’s quality to consider too. For instance, in addition to all of the integrated apps, a platform ought to have a really good tool set that enables users to maintain what they’ve got and build new things including simple database apps as well as sophisticated processing apps that incorporate the social, analytic, integration, workflow, mobile, and other capabilities that make a platform real.

    To be sure, there’s more than a casual difference between the majors and their offerings, but generally speaking, each is trying to become the one-stop-shop for customers needing software technology. Each also differentiates itself through emphasis on different aspects of deliverables while hewing to the cloud mantra.

    Is it too late to become a platform?

    Well, quite possibly it is too late. It takes a very large amount of investment and the time and talent of scarce and very smart people to make a platform, and while all that development is going on the market is not standing still. So recently we’ve seen some successful companies being acquired by large platform providers and I suspect the rationale for the sellers was that it was time to join rather than attempt to compete.

    Microsoft bought LinkenIn recently but they’ve also bought large numbers of other technology companies that more or less fit their vision of platform. Oracle has bought more companies than I can count and continues to fold them into its platform or suite of clouds. Same for Salesforce, which just completed its acquisition of Demandware an ecommerce product.

    What’s next?

    As large as these collections of applications or platforms are, they can easily get bigger. We’re already at the point where very few businesses would likely use all of any vendor’s platform offerings because there’s just too much stuff. Many of these vendors have provided multiple tracks such as SMB and enterprise offerings, which would seem to automatically disqualify an organization from taking on everything on offer. Still there’s the grey area where an emerging business has one foot in each camp so hybridization is a definite possibility. It’s in the hybrids that the true value of a platform emerges.

    Hybrids can also mean mixing offerings from multiple vendors and the gob smacking reality of today’s platforms is that as huge as they are, they are still not big enough to crowd out the competition. That’s a tough reality because part of the reason for embarking on the platform trail is to help lock out competition. But no such luck.

    All vendors know they have to provide an elegant approach to integrating whatever is on a customer’s site. Of course, this goes double for the legacy systems every business runs. The legacy systems might have analogs on every vendor’s platform but legacy systems also go by the name of foundation systems, responsible for a business’s bread, butter, and profits. Businesses are thus naturally cautious about upsetting the apple cart so integration is a critical need.

    Ecosystems come into focus

    The platform wars are in full swing but the outcome seems assured. There will be several major competing platforms and we know which providers have them. Resistance is futile, announcing a new platform today is spitting into the wind. But at the platform level the group of applications made by third parties, commonly called the ecosystem, there’s plenty of opportunity.

    In the bad old days, third parties couldn’t commit to a single vendor because markets were not big enough. Today though, committing to one vendor’s platform is smart business. Committing means abandoning the need to maintain source code tuned to this or that operating system, database, hardware, and even language. With that, it seems to me that smart startups should begin life with a commitment to an ecosystem and thus a platform. It also means figuring out a useful offering in a market that seems to have everything, that’s a story for another time.

     

    Published: 1 year ago


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