This morning Google and JDA software surprised the markets with a press release announcing Google Cloud Platform (GCP) as JDA’s public cloud infrastructure. This is obviously a first for JDA and Google, but not for the market (see below).
Let’s dissect the news release (it can be found here):

Scottsdale, Ariz. – June 10, 2015 –JDA Software Group, Inc. today announced an innovative new collaboration with Google aimed at leveraging the core strengths of both companies to deliver JDA’s next generation cloud-based omni-channel and supply chain solutions via Google Cloud Platform, a powerful public cloud offering. Through this collaboration, Google will provide a uniquely scalable and flexible technology platform via the cloud to support JDA’s future application development and delivery.

MyPOV – Good move by JDA, as choosing a public cloud provider saves substantial CAPEX that would have gone into data center build-out. Now JDA can invest those savings into product. For Google it means more load for GCP, more enterprise exposure and likely the start of a number of ISVs signing up for Google as cloud provider. Load is essential for all IaaS vendors, as it ensure the economies of scale they need to procure attractive supply chain prices and rates. The untapped potential of on premises enterprise software is one of the largest growth potentials for public cloud vendors overall. Take JDA with 4000 customers, ultimately they will all have to go to public cloud solutions. That is a lot of server capacity. And finally a lot of customers to cross sekk Google Apps and Google for Work to.

“Google Cloud Platform offers the unparalleled speed, performance, scalability and reliability we need to launch truly differentiated solutions. After thoroughly evaluating potential Platform as a Service (PaaS) providers, JDA chose to work with Google due to its unsurpassed technology platform, investments and deep culture of innovation,” said Serge Massicotte, executive vice president and chief technology officer at JDA Software.

MyPOV – There is little doubt GCP outperforms other clouds on the performance side of the overall infrastructure. My recommended simple test is to monitor the speed of email provisioning when travelling internationally. I do that a lot and still have to find the place on earth where my Gmail account does not beat e.g. my Office account. And it is no surprise – the core business model of Google, advertisement, needs very, very fast servers and networks. More surprising is that the JDA statement refers to Google as a PaaS, likely meaning Google App Engine (GAE), which has been a less popular choice by enterprise software vendors. We need to learn more about JDA’s plans and use case to understand this better.

This collaboration, which will significantly accelerate the development of JDA’s next generation cloud solutions, is JDA’s most recent initiative aimed at delivering innovative products and services for its customers. With an unmatched R&D investment in supply chain and omni-channel solutions, the company recently formed JDA Labs – a dedicated research and development group committed to delivering patents, best practices and entirely new products to the market. Google Cloud Platform initiatives will be developed out of the JDA Labs in Montreal. JDA’s work with Google also complements JDA’s newly announced FLEX platform strategy, which easily connects JDA’s existing cloud-based solutions and on-premise solutions with next generation solutions built on Google Cloud Platform.

MyPOV – Two good moves by JDA. Forming a lab for more innovative work has been a proven approach in enterprise software, see e.g. also the SAP Lab network. The FLEX platform is an interesting approach bringing together more traditional JDA platforms with its next generation cloud strategy.

“With thousands of successful customers — including 21 customers named as part of the Gartner Supply Chain Top 25 for 2015 — JDA has clearly established its leadership in delivering world-class retail and supply chain solutions,” said Massicotte. “To maintain and expand that leadership, JDA is focused on developing new innovative products and services that will truly change the supply chain landscape. By working with Google — an established innovation leader — JDA will concentrate on working with our customers to co-develop these groundbreaking solutions with Google Cloud Platform, providing an unmatched foundation. It’s a huge win-win for JDA customers, who will benefit from best-in-class solutions, delivered rapidly, from two proven market leaders working together.”

"We're thrilled that JDA has chosen to work with Google Cloud Platform to develop their next generation of products and services that will change the supply chain landscape," said Dan Powers, director, Google Cloud Platform. "The supply chain and omni-channel industry is ripe to benefit from the innovation, scale and flexibility of our public cloud offering, and by betting on Google, JDA can now focus on creating high impact business solutions while quickly adapting to meet customer needs." […]

MyPOV – The usual quotes – no commentary needed.

This month, JDA will be part of the keynote at a series of Google Cloud Platform Next events worldwide that highlights our work together. JDA executives will be featured speakers at Next events in New York on June 12, San Francisco on June 16, London on June 23 and Amsterdam on June 25. Learn more about the Google Next event series here.

MyPOV – Well good to be able to promote the new offering at Google events. I would not be surprised to hear a repeat of ‘Infor – who?’ (like at AWS Cloud event in March 2014 in San Francisco) in the form of ‘JDA – who?’ – at these events – but that is all part of becoming known as a vendor build on the public cloud.

Overall MyPOV

It is a Win / Win / Win for the partners and JDA customers. JDA customers should see a better return of R&D given the choice JDA has made for GCP. Let’s not underestimate the TCO aspect in this partnership, too – as Google has recently lowered prices (again – read here) – and many JDA customers turn the penny twice before they spend it. JDA saves CAPEX that it can put into its product organization and roadmap. Google gets load that helps it to scale better.

On the concern side, JDA is the first enterprise vendor to opt for Google. Certainly JDA has done good due diligence and Google is motivated to make it a success, but being first has risks – but also rewards when done right and successfully. And it is clear for JDA customers that the bulk of R&D going forward will be on public cloud platforms. Like it or not, customers should prepare and accommodate for that.

But in the meantime congrats to both vendors for a synergistic partnership, very likely many more to follow.