Tuesday, April 3, 2012

Credit Suisse: The Apps Revolution Manifesto

From Barron's Tech Trader Daily (Mar. 29):

 SAP, ORCL To Ride Wave of ‘Apps Revolution,’ Says Credit Suisse
Credit Suisse’s Phil Winslow this morning offers up a massive (99-page) note that he calls “The Apps Revolution Manifesto — Volume 1″, the point of which is to describe what he calls a “paradigm shift in enterprise software architectures.”

The world is at the “most significant revolution in database and application architectures in 20 years,” writes Winslow.

Winslow describes four aspects of the shift, namely, the transformation of the user interface via mobile, the transformation of “back end” technologies in “cloud computing,” the rise of “new classes and volumes of data,” the so-called Big Data revolution, and an acceleration of the gathering, analysis, and sharing of data, called “Fast Data.”

The convergence of all of that is like the “client-server” revolution in the early ’90s, he thinks, or the rise of Web-based software a decade ago.

The result, writes Winslow, should be a much healthier enterprise software market than is currently anticipated by investors:
The next application modernization cycle, which we expect to gain momentum throughout 2012 and extend well into 2015 (if not beyond), will not only (1) drive an upgrade cycle of legacy applications, but also (2) expand the user base and penetration of applications and incremental modules, and (3) produce new generations of enterprise software companies and “killer apps.”

HT: Venture Chronicles who writes:
I’ve been reading a research paper put out by Credit Suisse called The Apps Revolution Manifesto – Volume 1: The Technologies.

It’s a fascinating read, if you can get a copy I would encourage you to get a copy (I don’t believe I have distribution rights otherwise I would like a download copy myself). As I read it I am struck by 3 thoughts:
1) Credit Suisse’s thesis is, to paraphrase, that predictions of big on-premise app vendors deaths are premature. I tend to agree with this view… but with some important caveats.

2) We are upon yet another great app modernization cycle, but for me the question revolves around the winners and those that don’t win as much. The last upgrade cycle was CAPEX centric, this one is going to have it’s own healthy dose of CAPEX but not nearly as much as the last cycle, while OPEX spending will be greater and spread across a far more diverse market....MORE