Much has been written about the promise of mashups to become serious business tools
— as well as the obstacles and
challenges they must overcome along the
way. It’s only now, more than six years since the notion of mashups first came to the fore (they
acquired the name
a little later), that SaaS vendors and integrators are beginning to realize the full potential of
the mashup for enterprise applications. As this first wave of commercial enterprise mashups comes
to maturity, it is making clear once and for all the mashup’s seminal role as the
disruptive motor at the heart of the on-demand model.
As a case in point, take Xactly’s 5-way mashup,
announced Monday (image
courtesy of Xactly). Using Salesforce.com’s Force.com platform as the foundation, the SaaS
vendor has mashed up its own sales compensation application with Amazon.com’s retail
catalog, the Paypal payment system and an iGoogle gadget. The mashup creates an enterprise-class
incentive rewards management and fulfilment application that at the same time is economical
enough to be affordable for smaller businesses — subscriptions will be $10 per
user per month, at the end of a 90-day free-of-charge launch window that ends December 1st.
Using the application, an organization can set up award targets to incentivize its sales,
marketing or contact center teams, with points instantly convertible to retail purchases from
Amazon’s online catalog. The awards are paid for out of a Paypal account, which the
organization maintains in credit to match its awards budget. Users can view their incentive
targets and tallies from within Salesforce.com, or using the iGoogle gadget.
This five-way mashup is a substantive proof point for applying mashups to enterprise
applications. It pools the disruptive economics of at least three separate giants of on-demand:
Amazon, PayPal and Salesforce.com. Will any ZDNet reader dare argue with me that you could/should
do this in-house and do it better and cheaper? It’s simply not tenable. Nor is it any more
practical to think of implementing a similar mashup to Amazon, Paypal and the rest from an
on-premise application — leaving each individual customer to negotiate their
own gateway access to Amazon, Paypal and the rest, along with the necessary security precautions.
It’s a recipe for multiple implementation disasters.
In this respect, the Xactly mashup makes the case for multitenancy more convincingly than any
other example I’ve come across. It’s crystal clear that making any one of these five
components single-tenant instead of multi-tenant would instantly destroy the economic benefit and immediacy of the one-to-many multi-tenant model. A
multi-tenant mashup is a one-to-many instance: it makes all of its service integrations available
to any of its clients. In contrast, mashing up single instances one at a time is a laborious,
repetitive and economically wasteful activity.
The example makes evident the huge economic leveling effect that comes into play from mashups of
multi-tenant services. Xactly has been able to deploy a series of off-the-shelf components that
benefit from the economies of scale of market leaders such as Amazon and PayPal, while the
low-cost PaaS mashup development approach means that its developers could focus their efforts on
the business logic — workflow rules and policies, all managed by the Force.com
platform, are at the heart of the application. Using Salesforce.com’s PaaS platform meant
Xactly could develop the finished application in two months using just “a couple of
developers,” according to Xactly’s VP of marketing Karen Steele. Its marketing costs
will also be lower because the prime marketplace will be Salesforce.com’s million-plus
subscriber base (although the effective market is narrower as the capabilities used by Xactly
Rewards require an enterprise subscription rather than the less costly and more widely used
Professional or Team subscriptions).
As an aside, although Salesforce.com benefits from its role as the underlying platform for
Xactly’s mashup, it isn’t immune from the economic leveling effects of the
multi-tenant mashup. In April, cloud integrator Appirio released its cloud storage product for
Salesforce.com, which allows subscribers to bypass the relatively expensive costs of storing
documents and other assets on Salesforce.com’s servers, taking advantage of Amazon’s
much lower utility storage pricing. Appirio seems to be taking a leading role in enabling such
multi-tenant enterprise mashups — it released an interesting business contacts
mashup in May and has contributed the iGoogle element of Xactly’s 5-way mashup.
In summary, I think the Xactly mashup is a harbinger of the disruptive effect of multi-tenant
enterprise mashups, and of much more interesting developments that are yet to emerge.
There’s still a ways to go, though, especially when it comes to matters such as integrated
payment and user authorization. Xactly remains wedded to a subscription revenue model but this
application is interesting in that it uses a combination of two monetization strategies
— as well as the $10 per user per month subscription, Xactly earns what Steele
described as “a very modest markup” on each Amazon transaction. It’s designed
to cover the transaction handling costs but, if the application became successful enough to
generate large volumes of transactions, my guess is that it could potentially begin to offset the
subscription fee. However it’s worth bearing in mind that, in order to use the application,
subscribers not only have to pay Xactly’s $10 subscription — they must
also have an enterprise-level Salesforce.com account. What’s more, those subscriptions have
to be purchased separately instead of as a single packaged offering, adding unwanted hindrances
to the onboarding process.

