Another week, another on-premise vendor feels compelled to take shots at SaaS and cloud computing - this time it is Michael Saylor, CEO of Microstrategy (saw it courtesy of Anshu Sharma who should also get credit for inspiring the title when he said "the sky is falling" for on-premise vendors). Using age-old FUD of security, availability and scalability and using extreme examples like Amex and Visa's core transaction engines, the basic argument is "ain't going to happen" (BTW on a side note, companies like Alcoa which spend 1.29% of revenues on IT would go out of business if they emulated Michael's examples and spent 10+% of revenues banks do)
I think a more realistic answer is found in the aircraft fleet of a global airline like BA. Of course, it has 747s for its trunk routes but it also has plenty of 737s for shorter routes. Indeed, if you ask Boeing, it will confirm it has sold to airlines 5 times as many 737s as 747s.
In computing, the System 36 was never supposed to succeed in a world dominated by mainframes. PCs were supposed to be personal tools, not corporate ones. There were security, availability, scalability issues with them also. But there were cost, other overwhelming advantages which allowed them to succeed.
Every business has crown jewels it will not move to SaaS or cloud models, but there are plenty of SG&A activities that are already headed that way.
Through the clouds on a 737.
