I'll give you another example. One of the world's largest software companies called us up. They traditionally have sold their software with the white-shirt, red-tie, blue-suit kind of approach where somebody walks in the door and you buy the big blob of software. They have become convinced that the road ahead for them is one where customers will go to a website, they will specify, "I need these application modules," and here are different pricing models. This one is number of seats. This one is all you can eat. This one is nine to five, Monday through Friday. Customers basically want to arbitrage price and have the ability to decompose their pricing. Traditionally companies have fought like crazy to not allow that. Now they're basically saying, "We give up." It's going to ultimately become disaggregated. Customers are going to be able to see our pricing models. But then in order for us to not go broke, we have to know what our cost model is for delivering that.
You're talking about retail.
Beauchamp: That's right. Enterprise is going retail. In order to do that they need cloud-based solutions, self-service, customer-requested. They can't have any people involved in this. It's got to be a no-touch environment. This is what I think is fascinating about where we play. When I joined BMC in '88 the job was: Somebody bought something, it was working fine and then it broke one day so they called up somebody else like us to sell them a tool so that wouldn't happen again. Like high-speed backup or red light, green light [management]. Now what they're saying is, cloud is as much about automation and about self-provisioning and service-level management, compliance and transparency as it is about the infrastructure itself. Management actually becomes the delivery mechanism for the application.
Software as a service
Where are you playing on the SaaS front?
Beauchamp: We give our customers the ability to deploy clouds so that they can be providers. We also work with the service providers -- and by the way, outsourcers and systems integrators who want to set up multitenancy environments for delivery systems -- to configure, deploy, and charge and manage cloud-based service platforms.
In the last quarter we announced two major SaaS offerings -- our Remedy, which is, you know, the world's largest IT service-management system, as a service on demand. It's hosted. It's delivered. It's secured. You don't have to go in and set it up in your centers, and you can run it yourself and deploy very rapidly. Also, Salesforce.com announced Dream Force a few months ago. So they now have a service desk on their platform called Force.com that their salespeople actually get paid to sell. And this is not their typical partner deal. This is a special relationship between our two companies.
The other thing we do with SaaS is we sell software to Salesforce.com, Concur, Edmonds, and others who themselves deliver SaaS. They need management just like everybody else needs management.
Behnia: We also can help manage SaaS applications for the enterprise. If you want to know how many licenses you have on your SaaS-based applications, our asset management system has been extended to be able to account for those licenses. If you want to do response time monitoring, you can do that.
The changing role of IT