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DIY enterprise software support?

Protocol Enterprise

Hello and welcome to Protocol Enterprise! Today: why the right-to-repair movement is taking a closer look at enterprise software, the data implications of Amazon’s purchase of One Medical and enterprise tech moves.

The golden goose is under attack

There are two key reasons why legacy software vendors can seemingly thrive for such a long time past their likely expiration date: maintenance and support.

It’s perhaps the most genius aspect of Big Tech’s business model. Charge customers to buy the product, then charge a yearly fee to make sure it continues to work correctly. And to make it even more lucrative, oftentimes the big providers will remove support for old systems — many that customers would still prefer to run — in a bid to get users to switch to the latest and greatest version. Or, in other words, spend a lot more money.

Independent vendors like Rimini Street have tried to solve this problem. Of course, legal action promptly followed from Oracle, one of the industry’s biggest proponents of this strategy. And now, there’s a push by advocacy group FreeICT USA to make it harder for Big Red and others to pile-drive third-party support providers.

  • Of course, even Rimini Street is trying to make money off of vulnerable customers caught in Big Tech’s web. In fact, the repair market is worth an estimated $175 billion, according to FreeICT head Shannon Mahaffey.
  • But that’s exactly why you can expect large IT vendors to fight aggressively against any proposed measure that would undercut its prized pig.

There’s often some invisible barrier that divides B2B vendors from more consumer-facing companies. Increasingly, however, those lines are being blurred; both by the IT vendors themselves, who are increasingly using direct-to-customer approaches to sell their products and services, and the governing protocols. For example, “Is business information considered personal data?” is a question that ZoomInfo may have to start answering a lot more.

Right-to-repair has long been pushed by customers of nearly every industry. But given how much money the software industry has made off of owning the maintenance and support function, the conversation feels long overdue.

  • The pricing mechanism is often a by-product of customer lock-in. Why take the risk of lifting and shifting to a new program when you can just pay a little bit of money to keep the existing one going?
  • In other words, you may hate paying Oracle, but going to your board of directors and pitching an ERP upgrade in this economic climate is basically a route to getting fired.
  • But there comes a point when that reaches a tipping point, particularly as Oracle and others only increase the amount they charge for maintenance and support each year.

It’s clear there’s an appetite for a fix to this long-standing problem. But given the broader standstill on action against Big Tech, it seems unlikely that lawmakers are going to be willing to wade into a niche and extremely lucrative line item for IT providers.

In today’s political environment, we’ll have to settle for someone at least talking about it.

Read the full story about the enterprise right-to-repair movement here.

— Joe Williams (email | twitter)


How global ecommerce benefits American workers and the U.S. economy: Alibaba — a leading global ecommerce company — is a particularly powerful engine in helping American businesses of every size sell goods to more than 1 billion consumers on its digital marketplaces in China. In 2020, U.S. companies completed more than $54 billion of sales to consumers in China through Alibaba’s online platforms.

Read more from Alibaba

Amazon’s virtual-real hybrid data and AI play

In tech today, almost every acquisition has a data and AI component. And with Amazon’s latest acquisition of primary health care tech and services company One Medical, there are many implications across its businesses, from product recommendations to health cloud applications to voice-activated AI.

Not unlike Amazon’s purchase of Whole Foods, the $3.9 billion deal brings it new ways to glean data and build tech to interact with people in real-world settings. One Medical operates medical clinics throughout the U.S. and has nearly 800,000 consumer and enterprise “members” enrolled to use its in-person and virtual physical and mental health services. Amazon already offers health care services to its own employees and other companies through its Amazon Care program.

One Medical also offers electronic health record software used by clinicians that sits on AWS infrastructure. That means Amazon will compete with the likes of Oracle-owned Cerner when it comes to supplying administrative software used by hospitals and smaller health care providers.

But it makes sense to think about One Medical as an AI play for Amazon, too. Through One Medical’s virtual and in-person clinical services, Amazon will generate valuable subject-specific data for AI-based health products. Data from discussions with physicians might be used to improve natural language machine learning models for voice-enabled health apps or in-office ambient doctor’s office software, for example.

Amazon already has plenty of health and life science cloud data and applications available through AWS; One Medical could use those — and learn from them.

The acquisition of One Medical could also help Amazon plug some data gaps. Amazon bought drug delivery service PillPack in 2018, although some of the company’s prescription data was cut off later that year.

— Kate Kaye (email| twitter)

Enterprise moves

Over the past week, DataRobot’s CEO resigned over slowed growth — much like DocuSign’s Dan Springer a few weeks ago — Rackspace named a new head of its cloud unit and more.

Dan Wrightresigned as DataRobot CEO. Current COO Debanjan Saha will take over as interim CEO.

Dharmendra (DK) Sinha was named president of Rackspace's public cloud unit. Sinha was formerly an executive vice president of global client services at Cognizant.

Buddy Brewer joined Memzo as CPO. Brewery was previously a VP at New Relic.

Patrick Reynolds joined CDP provider BlueConic as CMO. Reynolds was previously SVP of data and services at Mastercard.

— Aisha Counts (email | twitter)


How global ecommerce benefits American workers and the U.S. economy: Using economic multipliers published by the U.S. Bureau of Economic Analysis, NDP estimates that the ripple effect of this Alibaba-fueled consumption in 2020 supported more than 256,000 U.S. jobs and $21 billion in wages. These American sales to Chinese consumers also added $39 billion to U.S. GDP.

Read more from Alibaba

Around the enterprise

Microsoft will once again block macros by default in Office apps, after sparking an outcry within security circles for backtracking on a previous pledge to do so earlier this month.

SAP exceeded analyst expectations for tepid revenue growth, as enterprise tech awaits earnings results from Amazon, Microsoft and Google that will help shed light on the state of technology spending.

Thanks for reading — see you tomorrow!

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