Do You Trust Your Cloud-based Vendors?

"Hey Mark, why doesn't your FilesAnywhere upload link work?"

Say what? That's impossible. Maybe they're down for maintenance, and their announcement went to my clutter or spam folder.

So I head over to the online file storage site where I've been a customer since 2005.

This isn't looking good. I can't log in. They are down for maintenance. And there's no indication when they will be back online. I check their Twitter account. A lot of help that did. Their last Tweet was on September 24, 2015.

And then I found this Tweet from a customer:

It Could Have Been Worse

Thankfully, I don't use the site for storing sensitive files. I use it for secured file sharing and receiving. I've had no reason to use another service. It works, or at least it used to.

Needless to say, I was peeved. The majority of my clients are busting their tails in putting their customers and clients first. They continually go the extra mile paved with kindness and gratitude. It appears such service is not a priority with FilesAnywhere.

A couple days later the service was restored. No, I didn't get a message from FilesAnywhere. I checked their site and could finally log in. And in case you were wondering, there was no Tweet saying power had been restored.

I don't get it.

Turning to Quora for Answers

My biggest fear was that FilesAnywhere had shut down because it couldn't pay its bills. Why else would they be shut down with no communications to their customers? 

So my FilesAnywhere experience got me to thinking. What if there were the equivalent of the Good Housekeeping Seal of Approval for SaaS-based companies assuring to their customers they are on sound, financial footing.

I can think of a dozen or more reasons why this would never work. Still I wanted to ask the question over at Quora. One such answer was so good, I wanted to share it. I appreciate Tim Hampson giving me permission to publish his insightful response.

If you are using any SaaS-based platform, this is must reading.

Five Questions for Tim Hampson, Founder of SalesSeek

Should there be some type of Good Housekeeping Seal of Approval for SaaS-based companies assuring to their customers they are on sound, financial footing?

Tim Hampson: I think this raises a very important point, but I don't think a seal of approval would help, or that financial footing even has much to do with it.

Google has as sound a financial footing as any company, yet regularly pulls the rug on SaaS services that fail to perform--anyone remember Google Wave? It's not hard to see similar examples from Microsoft, IBM, and everyone else.

Tim, you raise a good point. Then as customers, what else do we need to be looking at with SaaS vendors?

I think the moral of the story is that as a customer, you should be looking for commercial redundancy. The original name for SaaS in the early 00's was "Utility Computing", and I still prefer that name.

The idea was meant first and foremost to turn computing applications into utilities in the sense that you could swop CRM suppliers as easily as you swop telco suppliers.

Excellent point. And then that means we’re potentially cybersquatting on rented land, rented technical resources.

That’s correct, we have an unhealthy situation where people are locking themselves into proprietary platforms with no "plan B".

Salesforce is a good example of this. Many of their customers are building substantial proprietary extensions with no thought as to how they might ever migrate from them.

The result is that Salesforce has been able to "extract rents" by triggering level shifts like the move from "professional" to "enterprise" level (a doubling of subscription costs too).

But most customers have little alternative but to pay up. They've done the equivalent of building their own conservatory on a house that they rent--they've gotten the worst aspects of both buying and renting.

You have mentioned Salesforce. Any other big-name examples come quickly to mind?

Yes, the all-time worst example of this I can think of is mBaaS--mobile Backend as a Service. 

Also, PayPal (a very financially secure company) shut down StackMob, and Facebook (ditto) shut down Parse.

I’m assuming most IT Directors have your sense of awareness regarding SaaS-platforms of any kind. CEOs? I’m not so certain. What’s your advice for those of us with a weaker technology acumen?

I think there is a role for customers and analysts to probe all SaaS vendors and ask them in detail exactly how someone can migrate away. You always need a plan B.

For a more technical discussion on redundancy, this article by Martin Maisey is a good start.

My Plan B

Am I crazy for sticking with FilesAnywhere? Yes. I'm essentially saying with the annual fee that it's okay to shut down for several days without letting customer know ahead of time.

But I do a have a Plan B. And Plan B has a name too:

About the Author

Mark Gandy enjoys learning about the game of business as much as he does practicing it as a Free Agent CFO™ for small businesses in and around Missouri which includes several Saas-based clients. Mark also enjoys writing on his own turf over at G3CFO.