IBM to Offer SAAS Version of Lotus Notes

By Clint Boulton  |  Posted 2008-09-18 Print this article Print

IBM plans to offer a hosted version of Lotus Notes, which will bring the enterprise application into the modern Web services and Web 2.0 world. However, such an offering will join myriad other SAAS messaging and collaboration suites in the market. IBM will need to offer some compelling differentiators, such as social software or 3-D tools.

In a move that spells out just how hot software as a service has become, IBM will soon offer a hosted version of Lotus Notes.

Speaking by phone after delivering a keynote on Web 2.0 computing at Interop Sept. 17, Bob Picciano, general manager of IBM Lotus software and WebSphere Portal, told me the hosted version of notes is geared toward companies of 1,000 to 10,000 employees and could cost between $8 and $18 per user, per month.

"This will have very aggressive pricing per seat for organizations small and large," said Picciano, who declined to provide additional details of the product beyond that IBM will have more to say in a few weeks. Stay tuned.

Such an offering would make IBM's traditionally on-premise collaboration applications, such as Lotus Sametime instant messaging and VOIP, a threat to Microsoft Exchange Online, not to mention a number of small, independent SAAS collaboration providers that want to cater to large customer bases.

However, a SAAS version of Lotus Notes is unlikely to threaten CallWave, Yuuguu, Yugma and others, which aim for smaller customer bases. Also, some collaboration vendors, such as Jive Software and Awareness, offer social networking tools as well.

Unless IBM aims to integrate its Lotus Connections enterprise social software, those vendors should be safe.

Also, because there are hundreds of SAAS collaboration plays out there, I expect IBM to integrate Lotus Connections with the hosted version of Notes, along with 3-D collaboration capabilities, such as having co-workers trigger chats between their avatars.

I'm getting a little ahead of myself here, but I think you can all see where this is heading. SAAS collaboration software is becoming increasingly table stakes for customers tired of one-size-fits-all solutions.

Businesses, particularly those facing a constrained economy, will look to pay $10 a user per month instead of a lump sum for users who may not even use the software.  

The real competitive target for IBM remains Microsoft. IBM and Microsoft have been locked in a power struggle over collaboration software for years.

IBM doesn't break out specific figures beyond the fact that we know the Lotus group tends to enjoy roughly 20 percent sales growth every quarter. Microsoft SharePoint, meanwhile, is a $1 billion business. I doubt IBM can claim that for its Notes suite.      

Picciano also told me the punctuation of his keynote talk yesterday was about how to get the proper business result out of Web 2.0 technologies, not just about having fun.

This is one of the reasons why IBM is launching the IBM Social Software Center, in which the company will initially pump $15 million into funding collaborations among IBM engineers, customers, business partners and academia.

"I'll look at the interest to dictate the amount of investment that we'll continue to put in," Picciano told me. 


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