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SLAs in the SaaS space

This may be a bit higher level then the general discussion here, but I think this is an important issue in how it relates to reliability and uptime. What kind of SLAs should we be expecting from SaaS services and platforms (e.g. AWS, Google App Engine, Google Premium Apps,, etc.)? Up to today, most SaaS services either have no SLAs or offer very weak penalties. What will it take to get these services up to the point where they can offer the SLAs that users (and more importantly, businesses) require? I presume most of the members here want to see more movement into the cloud and to SaaS services, and I'm thinking that until we see more substantial SLA guarantees, most businesses will continue to shy away as long as they can.

Would love to hear what others think. Or am I totally off base?

Reader Comments (2)

The value proposition for SaaS doesn't seem to be uptime or we would see more movement in this area. Since most providers hit uptime and performance targets that are better than most in-house solutions can manage maybe it's not considered a priority because there aren't better alternatives.

In the industries I've worked in that had real SLAs with substantial penalties for failure, not just service credits refunded, the products had very high margins. Are customers willing to pay significantly more for SLAs that have more teeth than the feel good SLAs we have now?

November 29, 1990 | Unregistered CommenterTodd Hoff

Good points Todd, but I argue that the even though uptime may not be a large value proposition in the SaaS space, it's a hugely important hygiene factor. With the loss of control when moving to externally hosted services, I feel that businesses will need a strong sense of trust in the reliability of those services. Even if uptime is generally much better then any in-house solution, at least you have the power to do something about it when it is in-house. The first time a major downtime even occurs, the managers/CIO will have to have some ammo in explaining how they are going to deal with these kinds of things in the future.

November 29, 1990 | Unregistered CommenterLenny

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