RightNow Sees Enterprise Software Nirvana as Here Right Now

| About: RightNow Technologies, (RNOW)
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The customer relationship management (CRM) software provider RightNow (NASDAQ:RNOW), was born as a subscription-based application service provider (ASP) in 1995, then became an Internet-based CRM software provider, a software as a service (SaaS) CRM provider and then an on-demand CRM provider. Now it is positioning itself as a CRM-in-the-cloud provider.

Actually, of course, RightNow hasn't changed a thing over the years in terms of its business model. That's OK with me, but IT investors reading last week's RightNow news need to realize that with last week's announcement, the enterprise software supplier is simply trying to PR its way into the "enterprise software is dead" debate in order to keep up the 15% growth in ASP/Internet/SaaS/on-demand/cloud CRM revenue it posted in 2009.

And that's OK too except that RightNow's "the future is already here" creed could cause some problems in the market reaching the level of ASP/Internet/SaaS/on-demand/cloud-computing adoption that it is trying to rev up. RightNow says,

"...clients should be able to buy only what they need and still get long-term (5-year) pricing certainty."

The company also says customers should get no long-term contract lock-ins, the ability to easily adjust seat commitments, the right to increase or decrease capacity or product modules whenever presumably without financial penalty, all with no need to purchase capacity for peak usage. And users should get a cash reimbursement if a vendor fails to meet its service commitments.

It's the nanny state meets the IT world. And it reminds me of the ill-fated Viatron of 40 years ago. Even I'm not old enough to remember all the details but Computerworld credits the Viatron fiasco with single-handedly retarding the development of the personal computing market by 10 years. I think it's possible that too much promotion of RightNow's ideas could do the same thing to ASP/SaaS/on-demand/cloud computing, which is already limping along.

I believe in 10 years or so, the sort of utility computing that RightNow talks about could arrive. We have it in landline voice communications already but are not even anywhere near those kinds of market dynamics in cell-based communications. The cell guys are going to have to figure out how to deliver on the RightNow manifesto before the enterprise software guys can do it. The risk is that IT users will wait 10 years, like they did for the benefits of personal computing that Viatron promised but could not deliver, before adopting cloud computing or whatever it will be renamed by then.

(And RightNow is an enteprise software supplier after all, not some kind of different animal as it would like to pretend.)

Disclosure: Author has no position in the companies mentioned.