"The decision by Infor to run its CloudSuite applications on Amazon Web Services has been a controversial one. Mostly because it goes against what almost all other software-as-a-service vendors are doing - both old and new," reports Derek du Preez of Diginomica.
In a Nov. 12 column, headlined "Infor hits back at criticism of its decision to use AWS for CloudSuite," he outlines the criticisms, then lets Infor Presidents Duncan Angove and Stephan Scholl respond.
Here are excerpts:
Diginomica analyst Dennis Howlett asked:
"If Amazon's lights are suddenly dimmed … how will Infor maintain control over its cloud infrastructure? Speaking of control - most commentators believe Amazon will end up dominating the cloud infrastructure market. Google and Microsoft might have something to say about that but what happens if Amazon decides to unilaterally increase prices? What does that do to Infor's model?"
Criticism from NetSuite CEO Zach Nelson:
"[Infor's strategy] is very different and different from everyone else - no successful cloud company has built their application on AWS. I think that speaks for itself. It's not naïve in the sense that AWS can't do it, it's naïve in the sense that when you deliver an application like NetSuite you need to control every layer in the stack. … Secondly, ultimately you want to cost reduce your delivery and if you don't control everything down to the hardware, how do you cost reduce it?"
Infor President Duncan Angove:
"Here's the thing, it's a scale game. Amazon has got 5 times more storage and compute capacity than the next 14 guys combined. They seem to reduce their price every week. The investments they are making in automation at the infrastructure level are going to way outstrip something that little old NetSuite can do on its own. To compare it on purchasing power or economics is ludicrous. NetSuite is never going to be able to invest in the type of data centre architecture and skill sets that Amazon has.
"Any dimension that you look at, whether it is scaling, or it's security, or failover and auto-start up, there's no way. Amazon shipped 286 new cloud services just in the last year. It's like comparing someone that builds jumbo jets to someone that tries to do it on their own as a hobby. It's so ludicrous.
"And by the way, because we are not having to make those investments, we are able to invest in the application tier. It's such old thinking. He [Nelson] started 15 years ago, he's got no choice, he's got to double down on where he is.
"Have you met these Amazon guys? Lights dim when they come in the room. Honestly, the horse power of the individuals and the investment in innovation is unbelievable. And we just tap into all that investment because we standardise on it. We get to tap into hundreds of millions of dollars worth of investment that they're making that just gets added to our R&D line. The reason that they're able to reduce the cost all the time is because they're constantly introducing innovation into their data centre."
Infor President Stephan Scholl:
"Going down into what Oracle, SAP, NetSuite do - they all have to protect their investments and charge out for their infrastructure and their speeds and feeds and pipes and database and hardware. We don't have that hang-up. … We are an applications company that will work on the next big thing. … And what is the real gold when you think of process flows? It's the application layer. Is it really important that you own infrastructure? If that's what NetSuite is going to say, it's counterintuitive."