News Article

 Washington, DC (12:34 PM EDT  Tue. Mar. 24, 2009)

By Rick Whiting , ChannelWeb

Business analytics software developer SAS Institute is expanding its efforts in the realm of on-demand computing, including building a 38,000-square-foot cloud computing facility on its Cary, N.C., campus to manage the huge volumes of data generated by Software-as-a-Service and hosted applications.

But just how the vendor’s channel partners fit into the SaaS plans remains an open question. “We don’t have the perfect formula yet,” said Karl Schlatzer, SAS’ director of OEM sales and business development, strategic alliances and channels. “We’re cautiously and carefully feeling out how our channel partners fit into this,” he said Monday in an interview at the company’s SAS Global Forum customer conference.

The company’s solution providers are also taking a wait-and-see attitude, noting that cloud-computing initiatives from SAS could provide them with new service and consulting opportunities. But they said it also could create channel conflict if SAS simply hosts its own software products.

“Right now, it’s a little early, but we’d definitely be interested in being a part of that, either in reselling services or providing a support role,” said D.J. Penix, president of Pinnacle Solutions, an Indianapolis-based solution provider and SAS channel partner.

“It kind of interfaces with my business model,” said Matthias Kehder, director of analytical consulting at Modern Analytics, a San Diego-based solution provider and SAS partner. He said his professional service workers could use SAS’ cloud computing system to build prototype software for customers with less risk.

SAS is spending $70 million to construct the cloud-computing facility to provide additional data-handling capacity as the company expands its on-demand software and hosted services. The company said the facility would include two, 10,000-square-foot server farms, the first of which will be online by mid-2010 and support growth for three to five years. The second farm will remain a shell facility until the first reaches 80 percent of capacity.

Compared to other vendors and their resellers, Schlatzer said there might be less channel conflict for SAS’ channel partners as the company expands its SaaS offerings. Most SAS solution providers focus on providing sophisticated data analysis consulting and development services, which customers need regardless of whether an application is on-premise or on-demand, rather than technical implementation and support services.

This week, SAS also unveiled a SaaS version of its SAS Campaign Management application for managing marketing campaigns and analyzing the results. The company already sells the software for on-premise use or on a custom-hosted basis. In January, the company began offering its first SaaS application, an on-demand version of its SAS Drug Development software.

About Pinnacle Solutions 

Pinnacle Solutions is a Business Intelligence (BI) Solutions provider that uses SAS to integrate, analyze and interpret the “mountain” of data that companies collect and utilize to run their operations.  From a concept to a complete implementation, Pinnacle Solutions’ full service offering includes everything a company needs to build a customizable BI solution from scratch.  Pinnacle Solutions’ services empower companies to rise to a higher level of clarity, thus increasing work output and profitability.

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