Page 2

By Renee Boucher Ferguson  |  Posted 2006-02-09 Print this article Print

A standard part of an SLA often promises recompensation for services should the users applications be unavailable for a certain amount of time. On-demand ERP (enterprise resource planning) provider NetSuite, for example, states that if its 99.5 percent uptime guarantee is not met in a calendar month—outside of its planned downtime windows, usually in the middle of the night on a Saturday and never during the last weekend of the month—it will credit a customer with one month of fees, with customer support costs included. SalesNet, which promises 99.96 percent uptime a month, provides a formula that takes into account how long the system is actually down, versus how much a customer paid for their total subscription fee that month.
NetSuite, however, also reserves the right "at any time and from time to time to modify" the terms of service. Its also incumbent on the user to monitor downtimes that fall outside of the upgrade parameters, and notify the company to request a refund.
On-demand CRM provider RightNow Technologies has a "service-level objective" of 99.5 percent uptime and has achieved better than that since 2003. "We dont have guarantees on our contracts per se," said Jason Treu, director of corporate communications at RightNow. "However, if we fail to deliver on the stated time, and it is attributable to us, customers can get hosting fees returned." RightNow has never had a customer ask for a refund—not an atypical response. "All vendors [I evaluated] said theyve never had to pay out on an SLA; the burden is on the customer to prove in writing a complaint about downtime," said Herbert. "The first thing is, customers have to take the initiative. The other caveat is customers need to make sure any issues are not with their Internet service provider," an even harder metric to track. Typical recompensation plans come in the form of free application time—in the best case one free month for all users. Weaker SLAs only compensate users for downtime, which "really isnt that much" when you think of all the usage hours in a month compared with the number of outage hours, according to Herbert. The other thing Herbert points out is that even with a 99.5 percent uptime guarantee, an on-demand system can go down for several hours a month, beyond the predicted upgrade hours, without violating the SLA. In an S-1 statement filed with the Securities and Exchange Commission, states that "interruptions or delays in service from our third-party Web hosting facility could impair the delivery of our service and harm our business." Likely with this caveat in mind, the company has invested some $50 million in two new data centers—one on the East Coast, the other on the West Coast—that provide failover capabilities and better safeguards for customers. The second data center went live in January. Other vendors also provide safeguards for users. SAP, which announced Feb. 2 its CRM on-demand offering, provides an isolated tenancy model that keeps each users software on a separate database instance, while providing the on-demand model of pushing upgrades on a quarterly basis. It also hosts its software with IBM, which does provide SLAs. RightNow has used a combination of open-source and hosting technology to build a redundant system with data mirroring capabilities to ensure reliability. The assurances are important for users like Siler. He maintains a 99.93 percent uptime at Priority One. "We went through and established what we can do, as a national company operating out of a single location, to ensure uptime," said Siler, in St. Petersburg, Fla. "We did just about everything you can do. When we invest that much in our infrastructure, we expect other companies we contract with to be up as well." Editors Note: This story was updated to include comments from a user who has experienced outages. Check out eWEEK.coms for the latest news, reviews and analysis about productivity and business solutions.


Submit a Comment

Loading Comments...
Manage your Newsletters: Login   Register My Newsletters

Rocket Fuel