PwC: What do you see driving customers to cloud services?
Beer: The momentum is to the cloud. It´s been a Holy Grail for some time in technology, and the technologies that are coming together now are more likely to make this a reality. The savings and convenience opportunity that the cloud is offering is the single most important driver of change. Virtualization is one of the key enablers of those setting up business in the cloud..
PwC: You´ve been offering cloud services for some time. What did that mean to your business model?
Beer: It´s quite a different business model than deploying on-premise, so it requires a variety of different mindsets. One is the pay-as-you-go model, which has implications for billing and collections that are important to grasp quickly. A key variable for a hosted business is annualized recurring revenue, which reflects the evergreen nature of our hosted contracts but is not a traditional metric such as bookings or billings. So there´s a very natural instinct to try to conform the hosted business and its metrics to the usually fixed-term on-premise business. The on-premise business is so much larger, so why would you have the tail wag the dog? We had to flip that around and ask what the hosted business could teach the on-premise model. It´s a different selling model, and it has to be reported on in a different way.
We have kept our hosted activities organizationally separate from the on-premise business due to our interest in building up the different hosted business model. It´s been quite important to not conform the hosted selling effort to the traditional Symantec approach. Hosted offerings are proving to be attractive to small and medium sized companies but also to departments of large companies, so they are impacting the traditional go-to-market model. So we do see the same large companies show up in both our traditional and hosted sales processes. And we see some direct substitution going on.
PwC: What does the recent popularity of mobile technology mean to your approach to software offerings?
Beer: You´d have to be living in a cave not to see the proliferation of mobile. We´re likely to be accessing the Web through devices we wouldn´t have thought of such as TVs and Xbox gaming consoles.
But what´s valuable in life is not the device but the information contained or consumed through and by that device. That´s a big part of how we´re reorienting our company. Portability, security, and ease of access to the information are an important theme that will increase over the next few years. Users will get less tolerant of not being able to get information seamlessly across all these devices. But users, both consumers and employers, will need to be more aware as to what is personal information versus business information.
In mobile, applications ought to evolve so there´s a greater ability to work across the various devices involved. Apple is an outlier to that approach unless of course, you only use Apple´s various devices.
PwC: How do the heterogeneity and consumerisation trends affect your customers?
Beer: It used to be that five years ago, IT ruled the roost. That has changed significantly. Younger employees want to use the device of their choice at work, while senior execs want to use certain technologies and push for that ability internally — so IT is being influenced by both ends of the hierarchy, and as a result, you see, for example, more Apple products in conference rooms and on desks. For the CIO, the challenge is to meet the demands of the employees yet deliver on all the information security and compliance policies that are considered to be a minimum requirement of the corporation. This is a real challenge.
Meanwhile the consumer is beginning to feel the pressure of trying to make their disparate devices all work together seamlessly—in essence, they´re becoming their own personal IT department.. Yet the vast majority of people have neither the time nor energy to keep up with this task, so there´s a huge opportunity for someone to service that need.