Suite Connect - a confident NetSuite's international ambition on show
- Summary:
- Suite Connect was the first all-day customer event held by NetSuite in the UK with CEO Zach Nelson on combative form.
The past few days have seen some amusing Twitter sparring between NetSuite CEO Zach Nelson and his counterpart at arch-rival Sage, Stephen Kelly, based around the former’s new ad campaign which is aimed squarely at the latter.
This could become a running theme given that NetSuite clearly identifies as Sage as its primary competition in the UK, despite what Nelson described when I sat down with him in London yesterday as a total lack of a cloud solution:
They have a dominant footprint. In the UK Sage has around 15% of the market. Really we have different competitors in different parts of the world. So, in the US it’s Microsoft Great Plains. It’s typically a local provider.
The most exciting thing for Kelly to do would be to start talking about the cloud. If he was to say ‘we’re going to move to the cloud within 3 years’, that would be great for us because companies don’t have three years to wait.
I put it to Nelson that he and Kelly do have something in common - both are Oracle alumni and both have been immersed in the sales culture that that represents. While it’s early days, I wondered whether Kelly’s sales background is going to up the competition from Sage. Nelson demurs:
To be a good salesman you have to have something to sell. Sage’s last product release was Sage x3.People are just not buying that stuff. If he can sell that, he’s the greatest sales person. A I'm I'm
A true cloud application is architected from the ground up to live on the internet. Many of the applications that you're seeing today called cloud systems are hosted versions of software that you can now access over the internet. Buying cloud applications that look like that does nothing to solve your problems in the future.
He also spoke about NetSuite’s increased focus on the UK and European markets, saying business in Europe grew 100 percent in 2013 and citing the recent acquisition of London-based commerce firm Venda as a case in point:
Our investment in Venda this year was about investing in domain expertise in Europe. It was our largest acquisition to date. It's bringing our companies together and getting us to focus on the next great opportunity for growth, and that's Europe.
There will also soon be announcements about two in-region data centers. The locations of these has yet to be decided, but it seems likely that as Germany has the strictest data sovereignty regime, that would be a likely location.
In addition, the firm is increasingly open to pursuing public sector business and with the UK’s G-Cloud program requiring in-country data centers - although this is a requirement that is not enforced with Dublin seemingly counting as part of the UK for expediency reasons! - the UK would appear to be a candidate for the second center.
The competition
There was a confidence about the event overall that seems to match what appears to be a ratcheting-up of the marketing noise around the firm.
Certainly Nelson is pulling no punches when it comes to the competition. Workday, for example, receives short shrift for its financial applications ambitions:
They have ambitions, but they have no products yet. Even if they are successful in building financials, we’re in very different markets. They are built for people-heavy, non-transactional markets, we are really good in transactional ones.
They have made some fundamental mistakes in architecture. R&D is 35% of revenue. They’re trying to re-invent Oracle. Not only are they trying to build financials, they’re having to build a database company. Their desire not to send Oracle a cheque [for database technology] is going to cost their customers in the end.
Infor CEO Charles Phillips (another Oracle alumnus!) recently goaded NetSuite with a ‘swap out’ offer. Nelson is scathing:
What an offer - swap out NetSuite and go back 20 years in time. Needless to say not a single customer has done it. It’s nice to get an introduction into the Infor customer base though.
No successful cloud company has built its business applications on AWS - that speaks for itself in some way. It’s not that AWS can’t do it, but when you build an application like NetSuite you need to control every layer of the stack yourself. When AWS goes down, the first app they get back up won’t be Infor, it’ll be Netflix or something like that. Many companies move back off of AWS so Infor’s bucking the trend and it’s sort of indicative of not really understanding.
Dennis recently declared that there were signs of life in SAP Business ByDesign is still alive, but Nelson sees this as akin to Monty Python’s dead parrot sketch:
It is so dead. There has never been a deader product than Business ByDesign. It was dead on arrival.
To complete our tour of the competitive landscape I pointed out to Nelson that Microsoft’s Kirrill Tatarinov is sticking to his controversial claim that ‘no-one serious is doing cloud ERP’:
When your head of ERP is saying that, that’s the problem. The guy running the business is the last one to understand.
My take
A confident and polished first outing for Suite Connect in the UK, albeit on a much smaller scale than the annual Suite World event in the US.
But from what Nelson told me yesterday, a multi-day conference in London is the next step. Certainly the firm’s commitment to Europe is increasingly apparent and very welcome from the perspective of me as a Brit.
As for the Sage rivalry, signing up Ciber UK, one of the Sage’s bigger resellers, was perhaps more indicative of the shape of things to come than the Twitter taunting. That said, by my reckoning, it’s your move Mr Kelly!
Disclosure: at time of writing, Infor, NetSuite, Oracle, SAP and Workday are all premier partners of diginomica.
