Presentation on theme: "ISV Vision and Strategy Gianpaolo Carraro Director, Developer and Platform Evangelism"— Presentation transcript:
ISV Vision and Strategy Gianpaolo Carraro Director, Developer and Platform Evangelism
Agenda A Look Ahead Key trends Business models Q&A
A Look Ahead...
3 Screens Rich and powerful application UIs 3 Screens Development continuum across form factors (.net)
Windows 7 Improved experience Focus on fundamentals Application modernization Software Logo Program msdn.microsoft.com/swlogo
Mobility / Work-Life Merge (7 days Week End)
is this your office?
or is this your office?
how about this?
Always access / Shared context
Cloud As elastic computing fabric As elastic storage fabric As distribution channel As shared context
SaaS PaaS IaaS
The XBOX example
Subscriber Acquisition Const (SAC) and Churn Based on public SaaS company SEC filing Does not matter who Not Microsoft
Revenue GOOD! Not so much!
Subscriber Acquisition Cost (SAC) “Exposed” for 22 months
Impact of Churn: 10% Churn Ouch!!
Impact of Churn: 4% Churn Still Ouch!! Still Ouch!!
Break Even but < 1% churn!? Impact of Churn: Break Even
What to do? (business side) Long term contracts (24 months locking) –Remove some of the value proposition –Often very large churn at end of contract –Or “re-acquire” customer (more SAC) Get money upfront –No more churn sensitive Lower SAC –Distribution channel (e.g. white labeling)
What to do? (architecture side) Have a CLIENT strategy! –Not subsidized device (otherwise SAC) Examples: –Mobile phone (of course) –Heart monitor device connected to cloud service –Appliance
Selling Hosted Version vs. License ↓ Lower margins –Cost of sale is higher e.g. hardware depreciation (from pure bits, to bits + atoms) ↑ Bigger addressable market –Not only ‘software line’ in IT budget Illustration (overly simplified math): –80% margin on $1M (software) line -> 800K –20% margin on $5M (software + support + hardware) line -> 1M
Attached Services Additional revenue streams (typically with much lower cost of sale) Leverage the installed based The well proven “any fries with that?” strategy
Understand the platform
Understand the business models
Final thoughts: 2 fundamental questions you should ask yourself (if not asking already)
Note: I don’t have the answers... But I have strong opinions. Happy to share them at the party
1) Do I believe rich experiences are a competitive advantage? 2) Do I believe providing choice to my customers in terms of how and where to use my application is a competitive advantage?