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Cloud computing’s first major casualties: SAP and other legacy software firms?

Cloud computing giant SAP might have a reason to think twice. The impact of cloud computing is not reaching enough in the internet space.

Cloud computing giant SAP might have a reason to think twice. The impact of cloud computing is not reaching enough in the internet space.

If you work in the corporate world and are familiar with IT infrastructure, you would have nothing but respect for the giant German database firm SAP. SAP is a lean mean efficient database and software systems building machine. When it comes to building legacy software and highly responsive and efficient software backbones, you would be heart rest to find a close competitor to SAP while some people would say that oracle is a close competitor, they do have their overlaps but, SAP truly shines out in many segments. As awesome as SAP may be, both as a company and as a stock investment, SAP and other legacy software firms are probably looking over their shoulders a lot lately, why? The specter of cloud computing. There’s that word again, cloud what? Cloud computing is the once and future technology that suppose to revolutionize the world but everybody is still waiting around for its full manifestation. Regardless, there are trammers in the legacy software industry regarding the impact of cloud computing.

Legacy software development toward the cloud is not fast enough?

SAP is not dumb. They don’t get to be this big and this successful by playing ostrich. It knows the trends. It knows where the direction of the wind is blowing and devotes resources towards that direction. With that said, a lot of its critics are saying that legacy software development and its overall paradigm is not moving fast enough towards cloud computing. As a result it may find itself being swallowed by a tsunami in the near future. The truth is most companies have cloud computing initiatives. The problem is that the bigger the company gets the more bureaucratized it becomes. Whenever there is a lot of management egos involve change tends to proceed very slowly. And whatever change does happen tends to be changed by consensus not exactly the kind of earth shatter revolutionary and fast moving changes that the market needs. It would not be a big surprise if it was revealed that windows 8 flop because its design and overall paradigm is determined by consensus. Bureaucracy strives and consensus but innovation tends to be stifled by such bureaucratic processes.

The unlikely triumph as a cloud software service provider

Even though there seems to be so much bad news about Microsoft’s decisions lately, one thing is clear, it is doing a good job in the cloud software service provider space. It is doing a phenomenal job of moving as much as the corporate market to an application service model. Too many critics and Microsoft haters this would be unsurprising, why? Microsoft has a lot of money writing on the corporate market while it makes a lot of money on the consumer end, it makes quite a bit more money in the corporate end. Unfortunately, all Microsoft’s money and revenues is eclipsed by the revenues in mobile devices and mobile computing. And if Microsoft doesn’t do anything about this trend it would see all of its legacy properties evaporate. The truth is days of local software are going to end soon. The question is, what tomorrow will exactly look like? So it’s a good move on SAP and other legacy software producer’s part to start fumbling around with cloud computing but they really need to step it up notches or else they might get left behind. Also Microsoft really cannot rest on its Loral’s because Google is the 800 pound gorilla when it comes to the internet.