SaaS Meets MSP To Benefit IBM i Development!

Friday, March 24, 2017
Dan Burger

Development environments in IBM i shops have a reputation for clinging to the past. Taking into account all the shops where there is ongoing development, it’s fair to estimate that two-thirds to three-quarters of IBM i users have changed their development techniques very little in the past 25 years. There was little incentive to change during the first 15 years, but during the past ten years and planning for the future things will have to change.

Software as a service (SaaS) and managed service providers (MSPs) are gathering more attention. SaaS (subscription-based pricing) is becoming more common and MSPs are building out their services by adding SaaS options.

A good example is the recent partnership between change management-workflow management software vendor Remain Software and the managed service provider SIAS.

“IBM i shops are wrestling with application and infrastructure modernization,” says Marco Kok, managing director at Remain Software. “Cloud providers offering infrastructure for companies that no longer want to be consumed with managing infrastructure. And a lot of companies are unable to invest in buying new software licenses. There are also companies that have very specialized software that they don’t want to lose. They prefer to keep it, modernize it, and improve it. They can maintain it and modernize it in the cloud.”

Remain Software is positioning itself to help companies develop and test new and modernized applications in MSP hosted environments with its SaaS version of TD/OMS change management software for IBM i.

SIAS (Secure Infrastructure & Services), the Cloud Services Division of Data Storage Corporation (DSC), is a managed services provider specializing in IBM Power Systems hosting. Its services include IBM i, AIX and Linux, as well as other platforms that are connected to Power in multi-platform environments.

Hal Schwartz, president of DSC, told IT Jungle that SIAS is hosting the production boxes of more than 40 organizations and twice that number of organizations doing development, testing and quality assurance. He estimates 70 percent of ISAS customers run on IBM i.

“Customers ask us about products that can assist them. Based on what we’re hearing, we feel change management software is a good opportunity,” Schwartz says. “We include change management and workflow process automation as an option for customers doing development, testing and QA in the DSC cloud.

“Remain’s subscription-based software was tailored for an MSP situation. Program management–tracking changes in the development processes–is important to companies doing development and production in the cloud. And it fits in with our other subscription-based services offerings such as Computer Keyes‘ KeyesMail, Rocket Software‘s client access alternatives, Vision Solutions‘ high availability and other add-ons,” Schwartz says.

Prior to the partnership agreement, which was finalized last week, Remain had been testing the market for subscription-based software using its multi-platform collaboration tool called Gravity and TD/OMS Compact, a product that has been rebranded as TD/OMS Flex. The interest in those subscription-based models led to offering the full-featured TD/OMS with subscription pricing.

“Gartner predicts by the end of 2020, 80 percent of companies will no longer buy software licenses. They will buy software subscriptions,” Kok says. “We are already seeing increased demand for our subscription model. Some of the interest comes from companies that say they are planning to move off the platform and subscription makes more sense to get us to the end point. Others are deciding whether to buy or lease new hardware or put everything in the cloud. These discussions are much more frequent than they were several years ago. And, therefore, there are more discussions about SaaS. The SIAS and Remain partnership was done with companies in mind that are already thinking about the cloud as a production environment.

“I still see software licenses – perpetual licensing – as being important. SaaS will happen step-by-step in the years ahead.”

Remain’s SaaS contract fee includes maintenance, all new releases, and help desk support.

TD/OMS is also integrated with solutions, such as Fresche‘s X-Analysis code analysis tool, Linoma Software‘s RPG Toolbox for modernization projects, and BCD‘s WebSmart PHP, a Web application development environment.

For many software vendors, conversion of revenue based on licenses with large upfront costs and recurring maintenance fees is tough to give up.

“It feels like you are shooting yourself in the foot,” Kok says. “There is a risk for the software vendor. The subscription is based on 12-month renewals. If the contract is stopped after one year, the vendor will lose money. But there is the opportunity to create recurring revenue if the customer is happy.”

From the perspective of the software buyer, keeping current with product enhancements will probably increase the return on investment and if the vendor is not providing adequate support or the software does not receive meaningful improvements, it is, in theory, easier to make a break from the vendor.