Blog Post

Startups Fight Giants for the Real-time Enterprise

Real-time social applications for the enterprise have real products and real customers and about 18-24 months of lead time, but 2010 is the year that startups making such apps will be faced down by the likes of tech giants such as Microsoft (s MSFT), IBM (s IBM) and (s CRM). A new report from GigaOM Pro (sub. req’d) by analyst Sameer Patel sets the stage for the impending battle for enterprise hearts and minds.

In 2010, expect to see the concept of the real time enterprise ascend the hype cycle. Enterprises will begin to analyze how real-time access can help discrete business processes such as customer interaction, sales intelligence, lead generation, partner interaction and employee project collaboration, and they’ll begin to evaluate the switching cost of moving their systems and data to platforms that have real-time as part of their solution sets. Customers and prospects are interacting with each other and with enterprises in real-time making it imperative for the enterprise to structure its own internal and external processes to respond to customers as fast as possible. Expect this shift to be one of the primary drivers for considering a real-time architecture.

But as Patel notes, the real-time enterprise isn’t a foregone conclusion. Key stumbling blocks are integration with other enterprise systems, information overload, existing enterprise norms and portability. While startups such as Yammer, Socialcast,* Jive Software, Telligent Systems, NewsGator and Socialtext are off to a promising start, Patel sees Microsoft and IBM being most likely to capitalize on their existing enterprise relationships with the upcoming release of SharePoint 2010 and subscription-based pricing for Lotus Connections, respectively.

*Disclosure: Socialcast is backed by True Ventures, a venture capital firm that is an investor in the parent company of this blog, Giga Omni Media. Om Malik, founder of Giga Omni Media, is also a venture partner at True.

3 Responses to “Startups Fight Giants for the Real-time Enterprise”

  1. Come on MSFT and IBM, these guys are so late into the game and is not even funny. SharePoint 2010 will not be in the real enterprise until late 2011 after SP1 or later. Also, open source will changing things. We just released our open source micro-blogging sharetronix and are taking biz a way not only from the MSFT’s of the world, but also from Jive or Yammer. Other than OSS, pricing is starting to also play a big role here. Many large enterprise want a low cost that is not just based on a user any more and is not going to cost them millions of dollars. how many of you would pay the $65 per user to or even $5 per user to Yammer for real-time micro-blogging, are you kidding me. We now offer OSS ($0/user) and than some support only.

  2. A similar fight is going on in the SMB domain as well, where companies like ours grapple with solutions from the biggies like Google Apps and Microsoft BPOS and It’s not necessarily a fight for only “real time” apps, but more a mix of synchronus (online meetings, chat, real time authoring) and asynchronus (document management, email, forums) technologies. And since the biggies are not so entrenched in these companies, which are more nimble in terms of technological environment, startup products have a good chance.