How peeved is Amazon at HP-Workday deal?

By Steven Burke on Jun 21, 2013 8:09 AM
Filed under Cloud

Customer for HP's cloud.

Jeff Bezos Hewlett-Packard COO Bill Veghte caused quite a stir when he closed the company's recent Discover conference with the announcement that HP had inked a deal that makes Workday a customer for HP's public cloud.

Amazon Web Services, for its part, was quick to point out that Workday remains an Amazon Web Services customer, and that the relationship between Amazon and Workday continues to grow. Pleasanton, Calif.-based Workday is not talking.

Two things are certain: 1. HP has won a piece of the Workday business. 2. Amazon CEO Jeff Bezos is an investor in Workday.

Bezos' investment in Workday came as an $85 million Series F round of financing in October, 2011 that included Bezos Expeditions -- the Amazon CEO's personal investment entity -- as well as T. Rowe Price, Morgan Stanley Investment Management and Janus Capital Group.

Bezos, of course, can be none too pleased that a SaaS company he is backing has inked a deal with a rival public cloud player. Bezos Expeditions did not respond to a request for comment as of press time.

The HP-Workday deal, in fact, represents a watershed moment of sorts for HP's public cloud business. First off, it shows that a high-flying startup like Workday, which bills itself as the enterprise cloud for HR and Finance, sees a significant return on investment from making a bet on HP and the HP "enterprise grade" public cloud. Second, it shows that HP has proven its mettle with regard to sucking up data from Amazon Web Services and making it work in a hybrid cloud-like environment. Third, it shows HP's public cloud story is resonating with cloud-based SaaS startups like Workday, a highly profitable Amazon customer base. That's bad news for Amazon.

Workday, interestingly enough, was co-founded by Dave Duffield, one-time PeopleSoft co-founder and former chairman, who knows a thing or two about enterprise software. Duffield built PeopleSoft into an on-premise applications power that was sold to HP rival Oracle. Now Duffield is competing against Oracle with a Software-as-a-Service platform aimed at displacing PeopleSoft. My bet is Duffield sees the writing on the wall with regard to the future of the SaaS model and that future is well beyond Amazon Web Services.

Justin Fielder, the chief technology officer of EasyNet Global Services, a cloud-hosting and integration business that is betting heavily on HP's public cloud infrastructure, said as much at the Discover conference in his endorsement of HP's cloud offerings. "We needed a real big-step change in our ability to deliver to our customers," he said.

HP's services capabilities were critical, said Fielder. "There is continuity," he said of the HP relationship. "The same people that built it are the same people that are running it."

Veghte, for his part, was quick to point to HP's services prowess as a big differentiator. "It is not just log in and go, and if the site has an outage or an issue or a problem there is no one to call," he said. That, by the way, is a not-so-subtle reference to Amazon's infamous release notes providing updates on all issues, resolved or not, on a website rather than through an on-site services team.

"That [website-based contact] is necessary and modestly sufficient in some situations, but it is not sufficient for what you do every single day as you support your users and your businesses," Veghte told Discover attendees. "That is how we [at HP] approach what it means to have a cloud that enterprises rely on."

The differences between HP's cloud offerings and Amazon are stark. The web services marketplace is about to see a step up in class thanks to HP. The Workday deal is just the beginning. HP is just getting started.

This article originally appeared at crn.com

 
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