CA commits to SaaS model

Las Vegas – CA Inc. (NASDAQ: CA) has created a new business unit devoted to Software as a Service and is has also released three On Demand solutions that will have a heavy channel focus.

Jules Ehrlich, senior vice-president and general manager of On Demand business unit, said CA was being counted-out in many deals because it did not have a formalized SaaS offering.

“You don’t show up one day and say ‘we’re doing SaaS.’ CA has been on-premises and the way you sell that — demos, pricing, implementation, customer expectations — compared to SaaS is a lot different,” Ehrlich said.

The showpiece of the new SaaS Business Unit will be CA’s Instant Recovery On Demand solution for SMB. This new turnkey business continuity and disaster recovery service will be delivered exclusively through the channel.

The service will be on a pay as you go subscription basis. The pricing will be based on a per month per server model, said Adam Famularo, senior vice-president & general manager recovery management and data modeling business unit for CA.

“The channel will have a chance to wrap its own managed services around the CA Instant Recovery service in a sticky, fixed fee arrangement,” Famularo said. He believes that the channel can make between 10 and 50 per cent margins with this service.

Channel partners can offer SMB customers of 100 to 1,000 employees the ability to leverage CA’s XOSoft high availability technology through a hosted-cloud computing service.

“CA wants to be very specific with solution providers. We want them to keep control of the model and ownership of the customer,” Famularo said.

Currently CA is asking channel partners to use its infrastructure but is flexible to any kind of scenario where a partner with its own managed services, NOC and infrastructure can serve the software.

What Famularo is looking for is a cookie cutter approach that can apply to many solution providers. Right now, CA has only done one-offs with partners who are interested in serving the Instant Recovery management solution in a SaaS model. “We want to be as flexible as we can with partners,” he said.

Famularo added that a lot of partners are welcoming this approach because it means they don’t have to invest any capital into new infrastructure by using the CA system. “Many have added it to their line items offerings and just charged the customer accordingly.”

On a monthly payment plan, based on number of servers and number of years under contract, the price per server and per month can average $800, giving partners roughly 30 to 40 per cent margin just on the software, he said.

CA is using a direct to partner approach with Instant Recovery, but eventually would like to partner with distributors. The market potential of Instant Recovery service is pegged at $100 million in the next two years and Famularo believes it can rapidly grow from there to be a $250 million business after that, which is why the need for distributors to help CA get to more channel partners.

CA also announced that its enterprise-class Project and Portfolio Manager product Clarity will be offering as a service along with its Governance Risk and Compliance (GRC) Manager product. Both services will be available to the channel, but not on an exclusive basis such as the Instant Recovery service.

Clarity will start at $18 per user, while GRC will be $500 per user.

Ehrlich said that these three On Demand services will bring about faster return on investment, reduce install times and up front costs. These two services are offered in Standard and Enterprise editions.

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Paolo Del Nibletto
Paolo Del Nibletto
Editor of Computer Dealer News, covering Canada's IT channel community.

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