Market Move – Vector Capital takes Saba Software Private

Vice President and Principal Analyst
Constellation Research

Holger Mueller is VP and Principal Analyst for Constellation Research for the fundamental enablers of the cloud, IaaS, PaaS and next generation Applications, with forays up the tech stack into BigData and Analytics, HR Tech, and sometimes SaaS. Holger provides strategy and counsel to key clients, including Chief Information Officers, Chief Technology Officers, Chief Product Officers, Chief HR Officers, investment analysts, venture capitalists, sell-side firms, and technology buyers.  Coverage Areas: Future of Work Tech Optimization & Innovation  Background: Before joining Constellation Research, Mueller was VP of Products for NorthgateArinso, a KKR company. There, he led the transformation of products to the cloud and laid the foundation for new Business Process as a…...

Today we learned that Saba Software (Saba) is being taken private by San Francisco headquartered Vector Capital (Vector). The deal is valued at 400M US$ (see here) - setting the Saba stock price at 9 US$, pretty close to where it was trading over the counter (SABA was de-listed in 2013).

So let’s review the press release in our standard approach to major announcements:

REDWOOD SHORES, CA and SAN FRANCISCO, CA. – February 10, 2015 –Saba (OTC Pink: SABA), a global leader in cloud-based intelligent talent management solutions, today announced that it has entered into a definitive agreement with affiliates of Vector Capital (“Vector”) under which an affiliate of Vector will acquire all of the outstanding shares of Saba common stock for $9.00 per share in an all cash offer.

MyPOV – Nice way to stick in the new software category that Saba is trying to shape – ‘intelligent talent management’, with a lot of use of analytics. A good positioning and we took a first look at the new Compensation Management product back at HR Tech in Amsterdam in fall of 2014.

“Over the course of Saba’s comprehensive review, the Board of Directors and our advisors evaluated a wide range of strategic alternatives, and engaged with a number of parties. We are pleased to have reached this agreement with Vector, which provides significant cash value for our shareholders. Our Board unanimously believes that this is the best outcome for Saba, our shareholders, customers, partners and employees,” said Bill Russell, Saba’s Non-Executive Chairman.

MyPOV – Let’s hope this is the best outcome for Saba, which has been trouble for (too) long by not being able to release earning statements. Vector actually helped Saba with a credit line in the past (see here), so this acquisition may be a consequence of that credit action. If a good or bad next move – only time will tell and we may never know. Vector has a good track record getting troubled vendors back on track, I remember once famously hyped Niku (ultimately sold to CA) as a good example.

“Over the last 17 years, Saba has delivered a growing set of innovative intelligent talent management solutions, which are in use today by more than 2,200 global market leaders and innovators,” said Shawn Farshchi, President and CEO of Saba. “Vector has been a great partner to Saba since 2013. We are thrilled to continue the relationship, and take advantage of the support and resources of Vector and their partner network to strategically invest in expanding our product portfolio, further our customer success programs, and continue to the next stage of the company’s growth and market leadership.”

MyPOV – The way how Farshchi puts it, it looks like Vector might invest more into Saba. And that investment is certainly needed, as the vendor is building a new product suite and needs to compete with both Talent Management and overall HCM suite vendors with deep pockets.

“Vector, along with some of the world’s premiere financial institutions and investors, are excited to help Saba move beyond its financial restatement process and put the focus squarely on the Company’s innovative cloud talent management platform and its blue chip customer base,” said David Fishman, Managing Director and Head of the Private Equity Team at Vector Capital.

Andy Fishman, Managing Director at Vector Capital, said, “We are excited to partner with the management team and the dedicated and talented group of employees at Saba. We look forward to them becoming part of the Vector family.”

MyPOV – Interesting to find two quotes from Vector in the press release. Goldman Sachs veteran David Fishman is certainly the ‘software guy’ at Vector – with exposure to almost all its software related portfolio. Maybe both Vector divisions – Private Equity and Vector Capital help to fund the deal. Or Vector Capital gave Saba the credit, and now it is Private Equity to step up. Though the credit was relatively small (25M US$) compared to the current transaction value.

The transaction is subject to customary closing conditions and the approval of Saba shareholders, and is expected to close in the coming months. The transaction is not subject to any financing conditions. Saba senior management is expected to remain in Redwood Shores. [...]

MyPOV – Good to add that the senior management will stay in the campus in Redwood Shores – which promises personnel stability.

Implications, Implications

So let’s look at the implications of this transaction for the constituents.

Implications for Saba Customers

The hope would be that this transaction ends concerns about the viability of Saba. It will be back to Vector and Saba to make sure that roadmaps and viability from a corporate and financial perspective are given and communicated. Customers should actively reach out to Saba to get re-assurances on both roadmap items, global build-out and continuing operations. Saba and Vector should expect these inquiries and be ready to address them, ideally even proactively.

Assuming this will all pass well, this transaction is good news for Saba customers. Saba was previously cut out from raising capital, it now has the privacy of private equity to restructure, get books in order and grow product and global presence.

In the long run customers should not forget that Vector is a private equity firm and will not hold Saba ‘forever’ – so looking at the customary exit for PE firms in 5 or 7 years of holding Saba will be an important aspect for future contract negotiations.

Implications for Saba

We can only hope that this will put the vendor on solid footing, good investment and return to the strength and good reputation that Saba once had in the Learning and Talent Management space. As we wrote earlier, Learning is not winning the Talent Management Wars or the HCM Wars – so it is key for Saba to actively expand its portfolio. Like all Talent Management vendors it will need to decide if it needs to create a HR Core system – or not. The new (true) analytic (more here) angle of the latest product version is promising, but needs customer traction and adoption.

Implications for Saba Competitors

It looks like nobody wanted to buy Saba. Its strong Learning would have been a fit for Workday, could have complemented both Oracle and SAP. Would have helped Infor. Maybe ADP. Added a lot of customers for Ceridian and Ultimate, but probably was too expensive for them. If Saba ever explored this and why it did not happen - we will probably never know. Assuming Vector will invest into Saba, they (and the Talent Management vendors like Cornerstone, Lumesse, Skillsoft SumTotal, TechnoMedia etc. will see a more formidable competitor. The targeting of Saba customers may come to an end soon.

MyPOV

I hope this turns a less fit vendor into a good market participant and competitor. Talent Management has for a long time overpromised and under delivered. It is time for Round 2 – using the next generation capabilities of (true) analytics, BigData and cloud. That analytics matter for talent management, starting in recruiting is widely accepted not only by the traditional vendors but a bustling startup scene. Looking forward to have one stronger vendor in the market – good luck to Saba customers, employees and the vendor overall. Good to see the Saba story has not ended (yet).

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Data is Eating Marketing: Digital, Social and Mobile in 2015

Gavin Heaton

Founder
Disruptors Co

Gavin is the Founder of Disruptors Co, one of Australia’s leading independent strategy and innovation companies. Gavin advises firms on strategy, marketing, product development and innovation. He is also a member of the Orbits program, the influencer network of award winning analyst and advisory firm, Constellation Research. Gavin advises boards and leadership on innovation strategy, marketing, data-driven product development and corporate venturing. Gavin is on the board of Vibewire, a youth-led social enterprise based in Sydney, Australia and on the Technology Advisory Group for Good2Give – the workplace giving platform. ...

Data. It’s out there. And there is plenty of it. We create data with every status update, photo shared or website viewed. Each search we make is being monitored, sorted, indexed and analysed. Every purchase we make is being correlated, cross-matched and fed into supply chain systems. And every phone call we make is being logged, kept, passed on for “security purposes”.

There are so many kinds of data that it is hard to keep up with it all. There is the data that we know about – the digital items we intentionally create. There are digital items that are published – like books, websites and so on. There is email which creates its own little fiefdom of data.

There is also the data about data – metadata – which describes the data that we create. Take, for example, a simple Tweet. It is restricted to 140 characters. That is the “data” part. But the metadata attached to EACH and EVERY tweet includes information like:

Your location at the time of tweeting (ie latitude and longitude)
The device you used to send the tweet (eg phone, PC etc)
The time of your tweet
The unique ID of the tweet.

But wait, there’s more. From the Twitter API, you can also find out a whole lot more, including:

Link details contained within the tweet
Hashtags used
Mini-profiles of anyone that you mention in your tweet
Direct link information to any photos shared in your tweet

There will also be information related to:

You
Your bio / profile
Your avatar, banner and Twitter home page
Your location
Your last tweet.

There is more. But the point really is not about Twitter. It is the fact that a seemingly innocuous act is generating far more data than you might assume. The same metadata rules apply to other social networks. It could be Facebook. Or LinkedIn. It applies to every website you visit, each transaction you make. Every cake you bake. Every night you stay (you see where I am going, right?)

For marketers, this data abundance is brilliant, but also a distraction. We could, quite possibly, spend all our time looking at data and not talking to customers. Would this be a bad thing? I’d like to think so.

The question we must ask ourselves is “who is eating whom?”.

In the meantime, for those who must have the latest stats – We Are Social, Singapore’s massive compendium is just what you need. Binge away.

Digital, Social & Mobile in 2015 from We Are Social Singapore

Marketing Transformation Data to Decisions Future of Work Innovation & Product-led Growth New C-Suite Next-Generation Customer Experience Digital Safety, Privacy & Cybersecurity Marketing B2B B2C CX Customer Experience EX Employee Experience AI ML Generative AI Analytics Automation Cloud Digital Transformation Disruptive Technology Growth eCommerce Enterprise Software Next Gen Apps Social Customer Service Content Management Collaboration Machine Learning LLMs Agentic AI Robotics SaaS PaaS IaaS Quantum Computing Enterprise IT Enterprise Acceleration IoT Blockchain CRM ERP CCaaS UCaaS Enterprise Service developer Metaverse VR Healthcare Supply Chain Leadership Chief Marketing Officer Chief Customer Officer Chief People Officer Chief Human Resources Officer Chief Information Officer Chief Technology Officer Chief Information Security Officer Chief Data Officer

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The State of Customer Success Management in 2015

Vice President and Principal Analyst, Constellation Research
Constellation Research

Role: Vice President and Principal Analyst focusing on the IOT of Customer Experience and how the cloud is driving more flexible, agile, and robust customer service and customer experiences. In-app or in device customer service is the future. Coverage Areas: Next Generation Customer, Digital Marketing Transformation Bio: As a Vice President and Principal Analyst at Constellation Research, Inc, Petouhoff works with Fortune 100 and 500’s Senior Leadership teams to create strategic customer experience (marketing, sales and service) solutions which engage customers, build brands and grow businesses. Combining her experience as a former Forrester software analyst, PWC systems integrator and change management consultant, Petouhoff leads executive workshops to discuss to not only…...

This report is about The State of Customer Success Management in 2015. Constellation’s research team delivers its inaugural series on the state of the state. The state of the state research explores the impact of digital transformation, next generation customer experience and matrix commerce from a systems perspective considering the political, economical, societal, technological, environmental, and legislative point of view. This research report explores a key area – Customer Success Management (CSM).

It goes into detail about how next generation customer experience is guiding the success of Customer Success Management. A shift to Customer Success Management is emanate because we live in the world of a continuous, opt-in economy, where the value of a customer is determined by how long they stay a customer and if they continue to increase their purchase amounts over time. As a result, companies must prepare themselves to deliver great, continuous and consistent customer experiences. Before the opt-in economy, businesses were focused on the initial sale. A great deal of money was spent advertising and marketing to potential prospects, enticing them to convert from a lead to a sale.

However, little attention was paid to the after sale experience, even though the ubiquitous poor customer experiences still exist today after decades of research showing that after sales service directly affects the financial stability of a company. It makes absolutely no sense to spend millions or in some cases billions of dollars in advertising, marketing and sales to then drive the customer to the competitor because the after sales service experience is horrible. Yet this occurs every single day in many, many companies. Customer Success Management is based on the ability to deliver consistent customer experience process, before, during and— in particular, after the sale which continuous loops into increase customer lifetime value, enhanced revenue, increased margins and profits.

The main themes in the paper are:

Delivering a brand promise instead of a product or service requires new approaches.
Clients who believe in customer experience build CSM organizations.
CSM delivers more customers, less churn, and higher margins, really!
Predictive analytics identify known and reveal unknown attributes that drive customer success and
Expect larger customer experience vendors to incorporate these principles or acquire in this space.

The reason some companies like Zappos, Nordstorm, Lexus, which are all considered “luxury” brands can offer excellent service is that their business model is built with enough margin to provide the people, process and technology that can deliver great experiences. Businesses must move away from the thinking that this type of service is limited to only luxury brands and they themselves must stop cutting corners on CSM. All businesses that expect to make it through the next several years must begin to change their business models immediately so that they have the margin to provide great, loyalty creating experiences.

Is your company ready to transform how it treats its customers? For information on this report, download a snapshot.

Next-Generation Customer Experience B2C CX Chief Customer Officer Chief People Officer Chief Human Resources Officer

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CEN Member Chat: Critical Big Data and Privacy Trends

Steve Wilson

Former Vice President and Principal Analyst
Constellation Research

Steve Wilson is former VP and Principal Analyst at Constellation Research, leading the business theme Digital Safety and Privacy. His coverage includes digital identity, data protection, data privacy, cryptography, and trust. His advisory services to CIOs, CISOs, CPOs and IT architects include identity product strategy, security practice benchmarking, Privacy by Design (PbD), privacy engineering and Privacy [or Data Protection] Impact Assessments (PIA, DPIA). Coverage Areas: -  Identity management, frameworks & governance-  Digital identity technologies-  Privacy by Design -  Big Data; “Big Privacy”-  Identity & privacy innovation Previous experience: Wilson has worked in ICT innovation, research, development and analysis for over 25 years. With double…...

Learn how companies can strike a balance between privacy and the business value derived from big data. Steve Wilson and R "Ray" Wang discuss major trends at the intersection of big data and privacy.

Digital Safety, Privacy & Cybersecurity Chief Information Officer

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Analyst Event Best Practices - A year in review

Holger Mueller

Vice President and Principal Analyst
Constellation Research

As an analyst you attend a lot of events every year, user conferences and analyst briefings being the most prominent event types. So looking at the year in review – let me comment on some Dos and Don’ts and as well offer some suggestions for 2015.

But before that – my disclaimer: I know organizing these events is a lot of work. User conferences are the highlight of the year for many marketing departments, and a huge chunk of budget is spend on these. Careful considerations on agenda, speakers, location, and appreciation event need to be balanced with budgets. Not an easy task and as analysts we all appreciate to be invited to these events – this post is in the spirit to make these events (even) better.

So let’s start with some general suggestions:

Analyst schedules are almost always busy. We often don’t know from when and where we are flying in to the event until the last minute. Especially March to May and September till November are ‘crazy’ months when regular work (advisories, consulting, speaking etc.) collide with the conference schedule. So the earlier you can get your event schedule shared, the better, including the days and times for the analyst track. Then vendors should understand that analysts often don’t know till a few weeks before the event from where they will be flying to and back from.

Monday starts are popular for conferences, which mostly means Sunday travel to get there. It may seem little to vendors as this happens a few times a year, for analyst it means a few dozen times in the year (32 times for me in 2014). So travelling to the conference on Mondays will not only be appreciated by analysts – but also customers, who often attend more events than most of the vendor personnel.

For better coverage, it helps if you can share – under NDA as needed – the key announcements for the event beforehand. Some vendors do a very good job to brief analysts ahead of the event on key announcements and events, e.g. IBM and Informatica stuck out in 2014. You certainly get more coverage and a more attentive analyst crowd if you brief us ahead of time.

Analysts need the conference content to blog, report and advise shared customers and prospects about it. Ideally vendors would share that before – under NDA is fine – or as real time as possible. In 2014 one vendor shared documents of the conference 20 days later… needless to say the trains had left the station. And I would not play the silly game of giving feedback and in return getting the materials. Personally I am happy to play it as long as reasonable, but first priority for an analyst is to understand, tweet, blog, report on the event – not to provide feedback on it.

Events are exhausting, for all participants. But the follow up in the next 3-5 days with the analyst community is crucial, the faster questions can be answered, the better. Bringing the executives together at the end of the analyst track is a great best practice, e.g. done so by e.g. Amazon, Ceridian, IBM and Kronos in 2014. Providing high quality pictures of keynotes and slides is ensuring a vendor’s content looks great in blogs and reports. Otherwise it will be missed completely on the visual side or the best effort of an analyst taking his best picture…

Next – how do you seat analyst and press in keynotes… Tables and multiple power plugs are a must. Even though you get a first row seat but you need to balance smartphones (for tweets with pictures) and a notebook on your lap with two colleagues sitting next to you and trying to do the same – it definitively does not make our life easy. And is certainly detrimental to coverage. So it does not have to be the personal LazyBoy (as some of us were joking in fall) – but a decent table, power outlets and an ok chair will go a long way. And bio breaks are needed, too – so don’t do 4 hour keynote sessions as one vendor did in 2014.

And lastly – always a challenge – if you want the analysts to cover live / tweet from the keynotes - make sure that they have a working Wifi network. I realize that is a huge challenge, but with more regular attendees being active on social media – it is better to err on the side of spending more for Wifi than less. Providing a separate media / press / analyst network is a good practice, though I don’t like the two class society… a tweet is a tweet from anyone attending and using your conference hashtag. And the work around with wired connections is certainly a good one, but let us know ahead of time as not all of us carry the needed network adapter cables most of our devices require these days…. Lastly columns in the line of sight don’t help attention and visual coverage either.

On the subject of covering the event, in case you stream it – make it even easier to do so. I am waiting for streaming clients to have the respective social media buttons to share the slide / picture that is currently streamed right away to the social network. If a vendor wants more social coverage of the event, that is the biggest trick in the trade for 2015.

And then comes the bigger picture. We understand that vendors don’t want to share / cannot share information early some times. But give us a hint that major things are happening. Last year we had the case that a vendor announced very major new products – when all analysts were either already in the air or at the airport. Not only do vendors miss on the coverage, the previously written takeaways are obsolete or need a massive change. It’s ok not to give away the news, put tell us to pay attention at a certain time or day. Or not be on a plane at the time. Wink, wink.

Next comes the event coverage. Analysts understand that most vendor staff is exhausted, for you it’s a big event vs. for us analysts it is just one of many. I’d recommend vendors to keep some spare capacity for factual reviews and inquiries during and right after the event – as you want to stay in the news cycle. Often analysts are off to the next event and if their blog / report is not out quickly, things start piling up. The result is less, later and less accurate coverage, all things you don’t want as a vendor.

And after the even it is expense time. Making the expense process easy will be welcome by all analysts. Some vendors have given analyst ‘carte blanche’ for flight booking, setting limits to what they will approve amount wise. Giving the analyst the freedom to book their own flight is a win / win – so certainly a best practice to consider. One vendor has gone so far to do so for the whole event, setting limits for hotels, airport transfers, taxis etc. – a very good step all other vendors should take note of and ideally imitate. Bonus to consider for 2015: Do an expense drop when the analyst leaves the event, credit same cost for return to airport and incidentals for the rest of the day – and vendor and analyst are done. With the bonus that analysts are likely to show up when they leave your event.

And lastly cookbooks and other large items and gifts are certainly appreciated, but offer the analysts a shipping option. Last year I came back with three cookbooks in a week…

MyPOV

It is always great to be invited to an event by a vendor. It gives analyst prime insight into the people and product as well as customers, prospect and the overall ecosystem. A lot of work and investment goes into them, we are aware of that. With this blog posts I tried to point out some areas where these events can be even made better. Hope it is helpful.

If you are a vendor – let me know what you think – if you are an analyst – please do the same – and add what I have missed.

Marketing Transformation Tech Optimization Data to Decisions Digital Safety, Privacy & Cybersecurity Innovation & Product-led Growth Future of Work Openworld amazon SAP Chief Marketing Officer Chief Information Officer Chief Technology Officer Chief Information Security Officer Chief Data Officer

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Research Preview: Digital Transformation Services Take Center Stage For 2015

R "Ray" Wang

Principal Analyst and Founder
Constellation Research

R “Ray” Wang is the CEO of Silicon Valley-based Constellation Research Inc. He co-hosts DisrupTV, a weekly enterprise tech and leadership webcast that averages 50,000 views per episode and blogs at www.raywang.org. His ground-breaking best-selling book on digital transformation, Disrupting Digital Business, was published by Harvard Business Review Press in 2015. Ray's new book about Digital Giants and the future of business, titled, Everybody Wants to Rule The World was released in July 2021. Wang is well-quoted and frequently interviewed by media outlets such as the Wall Street Journal, Fox Business, CNBC, Yahoo Finance, Cheddar, and Bloomberg. Short Bio R “Ray” Wang (pronounced WAHNG) is the Founder, Chairman, and Principal Analyst of Silicon Valley-based Constellation Research Inc. He…...

Constellation State Of The State Report: Digital Transformation Services Take Center Stage For 2015

The latest Constellation Research state of enterprise technology report, Digital Transformation Services Take Center Stage for 2015, explores the impact of digital transformation on the services front. As so many different pieces of the digital transformation space come together, Constellation believes that the Digital Transformation Services category is set to explode in 2015, and we forecast it to surpass $100.7B in 2020.

Since the Digital Transformation Services have been poorly defined and often confused, in this state of the state report, Constellation defines the space, provides a high level overview of the seven key pillars, and notes various provider categories.

Digital Transformation Services Take Center Stage for 2015

At the core, this report is about a big shift that has occurred with customers. When it comes to Digital Transformation Services, most customers seek turn-key solutions and no longer have time for extensive vendor selection efforts. In fact, customers now prefer close knit partnerships between service providers and technology vendors versus an objective arm’s length relationship.

On the other hand, the pace of change coupled with customer desire for quick results will lead service providers to develop the last mile solutions, and technology vendors to partner with service providers to guarantee a successful outcome. Constellation believes that this shift in digital transformation services will initiate the blurring of product and services for years to come. As with the core digital transformation market, neither technology vendors nor service providers will be selling products or services. In fact, they too will be delivering on outcomes and experiences.

This report sets the premise for Constellation’s forthcoming reports on the Digital Transformation Services category; and offers insights into five of Constellation’s business research themes — Data to Decisions, Digital Marketing, Matrix Commerce, Next generation customer experience, and Technology Optimization and Innovation.

Your POV.

Ready for digital disruption by starting with mobile? Add your comments to the blog or reach me via email: R (at) ConstellationR (dot) com or R (at) SoftwareInsider (dot) org.

Please let us know if you need help with your Digital Business transformation efforts. Here’s how we can assist:

Developing your digital business strategy
Connecting with other pioneers
Sharing best practices
Vendor selection
Implementation partner selection
Providing contract negotiations and software licensing support
Demystifying software licensing

Resources

Reprints

Reprints can be purchased through Constellation Research, Inc. To request official reprints in PDF format, please contact Sales .

Disclosure

Although we work closely with many mega software vendors, we want you to trust us. For the full disclosure policy,stay tuned for the full client list on the Constellation Research website.

* Not responsible for any factual errors or omissions. However, happy to correct any errors upon email receipt.

Copyright © 2001 -2015 R Wang and Insider Associates, LLC All rights reserved.
Contact the Sales team to purchase this report on a a la carte basis or join the Constellation Customer Experience

The post Research Preview: Digital Transformation Services Take Center Stage For 2015 appeared first on A Software Insider's Point of View.

Tech Optimization New C-Suite Data to Decisions Marketing Transformation Innovation & Product-led Growth Leadership Chief Information Officer Chief Experience Officer

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The state of the state: Privacy enters Adolescence

Steve Wilson

Former Vice President and Principal Analyst
Constellation Research

Constellation Research recently launched the "State of Enterprise Technology" series of research reports. The series assesses the current state of the enterprise technologies Constellation consider crucial to digital transformation, and provide snapshots of the future usage and evolution of these technologies. Constellation will continue to publish reports in our State of Enterprise Technology series throughout Q1.

My first contribution to this series, "Privacy Enters Adolescence", focuses on Safety and Privacy. I've looked at information data privacy in 2015, and identified seven trends of which you should be aware in order to protect your customer's information.

Here's an excerpt from the report:

Digital Safety and Privacy

Constellation's business theme of Digital Safety and Privacy is all about the art and science of maximizing the information assets of a business, including its most important assets – its people. Our research in this theme enables clients to capitalize on cloud, mobility, Big Data and the Internet of Things, without compromising the digital safety of the business, and the privacy and trust of your end users.

Seven Digital Safety and Privacy Trends for 2015

State of Digital Privacy

Consumers have not given up privacy - they've been tricked out of it. The impression is easily formed that people just don’t care about privacy anymore. Yet there is no proof that privacy is dead. In fact, a robust study of young adults has shown no major difference between them and older people on the importance of privacy.
Private sector surveillance is overshadowed by government intrusion, but is arguably just as bad. There is nothing inevitable about private sector surveillance. Consumers are waking up to the fact that digital business models are generating unprecedented fortunes on the back of the personal data they are giving away in loyalty programs, social networks, search, cloud email, and fitness trackers. Most people remain blissfully ignorant of what's being done with all that data, but we see budding signs of resentment from consumers whose every interaction is exploited without their consent.
The U.S. is the Canary Islands of privacy. The United States remains the only major economy without broad-based information privacy laws.
Privacy is more about politics than technology. Privacy can be seen as a power play between individual rights and the interests of governments and businesses.
The land grab for "public" data accelerates. Data is an immensely valuable raw material. More than data mining, Big Data is really about data refining. And unlike the stuff of traditional extraction industries, data seems inexhaustible, and the cost of extraction is near zero. Something akin to land rights for privacy may be the future.
Data literacy will be key to digital safety. Computer literacy is one thing, but data literacy is different and less well defined so far. When we go online, we don’t have the familiar social cues, so now we need to develop new ones. And we need to build up a common understanding of how data flows in the digital economy. Data literacy is more than being able to work an operating system, a device and umpteen apps: it means having meaningful mental models of what goes on in computers.
Privacy will get worse before it gets better. Privacy is messy, even in jurisdictions where data protection rules are well entrenched. Consider the controversial new Right to Be Forgotten ruling of the European Court of Justice, which resulted in plenty of unintended consequences, and collisions with other jurisprudence, namely the United States' protection of free speech.

A snapshot at my report "Privacy Enters Adolescence" is available for download. It expands on the points above, and sets out recommendations for improving awareness of how personal data flows in the digital economy, negotiating better deals in the data-for-value bargain, and the conduct of Privacy Impact Assessments.

Digital Safety, Privacy & Cybersecurity Chief Information Officer

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Tuesday's Tip: How To Plan For SAP's S/4 HANA Upgrade And Contract Negotiations Strategy #SAPHANA

R "Ray" Wang

Principal Analyst and Founder
Constellation Research

Launch Of SAP S/4 Provides Catalyst For Organizations To Update Their Next Gen Apps Strategy

The February 3rd, 2015 New York City SAP S/4 launch event brought a positive closure for customers seeking the next generation apps strategy from SAP. At a high level, the SAP S/4 HANA offering offers:

a new suite of applications built only on top of SAP’s in memory database technology, also known as the SAP HANA platform
a user experience built from the SAP Fiori technology that also starts with a mobile first paradigm
delivery in the cloud, on-premises, and hybrid

At launch date, the first set of public SaaS offerings will include Simple Finance (SFIN), project delivery, and sales cloud for customer. Constellation estimates that the refactoring process of 400 million lines of code will take between 4 to 6 years. Constellation estimates that the functional parity on the vertical and micro vertical industries will take even longer.

The Bottom Line: Now Is The Time To Rethink Your Apps Strategy With SAP

While determining where to go in the future, Constellation recommends the following strategies in determining a go forward strategy with not only SAP, but also legacy ERP vendors on the journey to digital business and digital transformation. (see Figure 2).

Ask for all copies of previous order docs and price lists
Itemize every unit of software and cost per unit
Use third party maintenance as a lever
Battle indirect licensing
Understand your license usage
Never, ever, bundle your contracts
Focus on designing SOA Principles
Stabilize the core, invest in cloud
Remember you are the boss of the relationship

Figure 2. Four Paths Of Modernizing Your Legacy Apps

Your POV

How do you feel about your SAP investment? Is SAP meeting your needs or are you going elsewhere? Add your comments to the blog or reach me via email: R (at) ConstellationR (dot) com or R (at) SoftwareInsider (dot) com.

Please let us know if you need help with vendor selection or contract negotiation efforts. Here’s how we can assist:

Vendor selection
Implementation partner selection
Connecting with other pioneers
Sharing best practices
Designing a next gen apps strategy
Providing contract negotiations and software licensing support
Demystifying software licensing

Related Research

Reprints

Reprints can be purchased through Constellation Research, Inc. To request official reprints in PDF format, please contact Sales .

Disclosure

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* Not responsible for any factual errors or omissions. However, happy to correct any errors upon email receipt.

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Will the Internet of Things Change When the FTC Changes the Internet Into A Public Utility? AT&T and Verizon May File Lawsuits

Vice President and Principal Analyst, Constellation Research
Constellation Research

We in the tech world have been focused on the Internet of Things and how everything is connected or will be. What will be interesting to see is how the Internet of Things may change if the FTC changes the Internet to a Public Utility. The story in Venture Beat talks about the how the FTC, Federal Communications Commission, chairman Tom Wheeler is going to release a new regulatory approach affecting the Internet. The change is set to be effective Feb 26. The source from Venture Beat suggests that after the Title II reclassification becomes official, AT&T and Verizon will file lawsuits almost immediately.

The reclassification of the Internet as a public utility-like telecommunications service as defined by Title II of the Communications Act of 1934. The Title II reclassification will apply to both wired and wireless broadband.

The bill is sponsored by a several Republicans — Sen. John Thune (R-S.D.) and Rep. Fred Upton (R-Mich.) and has almost no support from congressional Democrats. The Republicans will need a certain critical mass of Democratic support to make the bill progress and to apply pressure on the president to sign it. And from what we’ve seen in Washington D. C. the ability for the two parties to collaborate on anything is pretty iffy.

The reason the FCC was forced to create a new “Open Internet” regulatory plan was because Verizon sued the commission over its legal standing to regulate network neutrality — and won. In the Venture Beat article it said that Hank Hultquist, AT&T’s VP of federal regulatory set the tone for his brand’s positioning on the change in a blog post. He says that AT&T’s position that the broadband service it sells is actually an “information service” and not a telecommunication service as described in Title II. It also says that the FCC simply has no authority to reclassify broadband without first completing a complete study of the existing marketplace. When the FCC has to defend reclassification before an appellate court, it will have to grapple with these and other arguments,” Hultquist wrote.

The reclassification to Title II will give the commission the legal framework and the authority to enforce network neutrality rules on Internet service providers (ISPs) like Verizon, AT&T, and Comcast. The commission will be able to make sure no carrier gives priority to one Internet content provider’s data packets over those from another.

Those that are for the change for a Title II reclassification believe the move is necessary to permit the FCC to collect universal service fees on data service and to implement privacy regulations. The threat of the lawsuits, and prospect of months or years of legal wrangling, is making many people nervous. It will be interesting to see what happens. The Internet of Things has suddenly become the Internet of Controversy. Hopefully it won’t spoil the plans of all the people and tech companies that have built their dreams on the idea of the Internet of Things.

@drnatalie
VP and Principal Analyst, Constellation Research

Next-Generation Customer Experience Chief Customer Officer

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What You Don’t Know About APIs Could Hurt Your Ability to Deliver Great Customer Experiences

Vice President and Principal Analyst, Constellation Research
Constellation Research

What is the API Economy? Why not knowing about your APIs, could hurt your business? One of the issues is that the APIs you currently have may not be making that seamless, contextual transition in the ubiquitous channel / device world most customers live in daily. (Ubiquitous channel / device meaning customers don’t think about the channel or device they are going to use to interact with you- they just do.) This API issue can apply to many functional department’s software: Marketing, Advertising, Sales, Customer Service, Customer Success Management and can lead to the success or to the failure to meet customer expectations — i.e., to meet the brand’s promise, deliver products and services, as promised as, well as meet the business’s expectation on getting the interaction and engagement data so critical to knowing their customer’s behavioral patterns and creating mass systems of personalization, which has been promised by many a vendor.

With the enhanced capabilities of software and the automation of processes, transactions, and distribution across every industry and companies within those industries, the gap of effective APIs is widening. APIs not only leverage software but also expose software interfaces to others. This includes, but is not limited to internal developers, partners, customers… and thus, APIs can help the brand get more information out of the interactions with their customers and also to work towards making interactions into engagements that are seamless.

The ability to making interactions into engagements that are seamless is really important in the multi-channel, multi-device, omni-channel world – which doesn’t — in reality — always exist like the marketing by some vendors says it does. And with mobile driving ubiquitous channel and device engagement necessities, as customers don’t premeditate when and what channel or device they will reach out to you on or which device or channel they will continue that interaction on, businesses must move from the idea of multi-channel, multi-device, omni-channel world into the world of ubiquitous customer engagement and make sure their APIs are delivering all they possibly can.

As I was doing a briefing call with 3scale, as they put it, we are in The API Economy. It’s a new economy, that is beginning to boom as brands realize what that the software they bought doesn’t exactly work they way they thought it did / could / would. And there are many things that companies need to learn in order to succeed. To help ease the API process, 3scale, the San Francisco and Barcelona-based API Management solutions provider, released a comprehensive eBook about APIs entitled “Winning in the API Economy. The book is available for download free.

The ebook features commentary and insights from 3scale’s management team and a roadmap for using APIs to advance a business. The book is designed for any business leader who is in charge of software strategy, or is contributing to it, and is looking to bring their organization gains through efficiency and new market opportunities. Many of today’s internal and external IT challenges have common roots in the need for a sound API strategy for supporting software systems. This can range from the evolution of platform strategies to accommodating mobile distribution channels.

“This book will appeal to leaders across multiple industries as software is becoming an indispensable part of almost every process, and software’s interfaces have the potential to drive a great deal of positive change,” said Steve Willmott, CEO of 3scale and author of “Winning in the API Economy. “With the API industry expanding so quickly, it is important for organizations to understand the impact that APIs can have on their business and learn about how they can use APIs to grow their bottom line. ‘Winning in the API Economy helps make the world of APIs accessible through easy-to-understand examples and strategies.”

The eBook combines real-world case studies with clear explanations to give the reader an ‘API roadmap’ to guide them into this rapidly changing world. It is especially important to understand what you should be expecting from APIs and the differences between what you are getting and what you should be getting from them.

It is possible that software can drive new business opportunities presented by APIs and lead to success and innovation. But this again, may require that IT and the functional business units collaborate so that the external customer experiences turn into systems of engagement and mass personalization at scale.

@drnatalie

VP and Principal Analyst, Constellation Research Covering Customer Facing Applications To Create Great Customer Experiences

Marketing Transformation Next-Generation Customer Experience Chief Customer Officer

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Will the Internet of Things Change When the FTC Changes the Internet Into A Public Utility? AT&T and Verizon May File Lawsuits

What You Don’t Know About APIs Could Hurt Your Ability to Deliver Great Customer Experiences