Another Texas VC

Forrester put out a report today highlighting the potential of Web 2.0 technologies in the enterprise. I have been excited about this potential since meeting Drew Larsen, whose product SAVO does just that in the Sales space. I have always been a bit skeptical about Forrester because of their dismal track record at predicting trends (Anyone remember their prediction that Tivo would be in 55% of homes within 6 years of launch‽), so with that grain of salt I read through Sarah Perez’s and Kara Swisher’s coverage of the report.

I really appreciate the following excerpt: “Web 2.0 tools will be defined by (its) subsumption into other enterprise collaboration software over the next five years; it will eventually disappear into the fabric of the enterprise, despite the major impacts the technology will have on how businesses market their products and optimize their workforces.”

I couldn’t agree more. Having spent the past 8 years either working with CIOs or within the enterprise I can honestly say that no company will come out and say something along the lines of “I really need some Web 2.0 in here. Where is my checkbook?” they are more likely to unwittingly stumble into Web 2.0 technology based on improvements to their end to end processes.

A brief history lesson: 

For me Web 1.0 was the internet allowing professionals to get their content out there. Web 2.0 is focused on allowing the general population to create and syndicate content, with Web 3.0 focused on how to cope with all of this information.

Enterprise 1.0, was focused on getting data out of filing cabinets and spreadsheets and into monolithic functional-module based systems (like SAP R/3). Enterprise 2.0 is taking a more end to end focused approach with hosted applications focusing on specific end to end processes (aka SOA). Enterprise 2.0 will create a series of challenges for CIOs as they attempt to cope with several different systems built on varying standards delivered through server-centric Java and .NET infrastructures. As these SOA tools continue to mature, several distinct trends will continue to gather steam.

Software as a Service (SaaS) will only get bigger. Salesforce.com was the tip of a very big iceberg as more and more companies realize that although they need configuration, they don’t need customization. For this trend to truly take off however, a real answer to the data hold-up problem will have to take hold. Until then, internally hosted SOA apps will be king. Tools making that administration easier, like Phurnace or cheaper like VMWare will only get bigger.

Cross Application Reporting Tools will become simple but more important. Drew talks about how the number of customizations and configurations drastically dropped when SAVO embraced the new Enterprise 2.0 paradigm. The proliferation of SOA apps like Performix and Salesforce will make cross application reporting essential, but the reductions in customization will make the integration jobs easier. Tools like Microsoft’s BizTalk, & Informatica on the data integration side and IBM’s Cognos & Oracle’s Hyperion on the Reporting side will have to adapt to the new commoditized world, creating opportunities for upstarts.

The Forrester Report really starts to irk me when they attempt to track expected spend for wikis and blogs within the enterprise. I just don’t see companies spending real money on enterprise versions of tools they can get for free on the web. I don’t doubt that other enterprise tools will branch into those capabilities (Like how Lotus Notes branched into instant messaging with Lotus SameTime, can we say SharePoint Blogs?), but I don’t see this happening with standalone applications. 

My take anyway…