Understanding Vendor Lock-In

On immediacy and today's consumer.

Often bombastic Salesforce.com CEO Marc Benioff was on Bloomberg West yesterday from the Web 2.0 Conference. He was taking a few shots (as usual) at Oracle CEO Larry Ellison. The video of the interview can be seen here.

Benioff discusses vendor lock-in, a term that describes organizations that continue to use big, expensive, and complicated applications because they want to, not because they have to. Think databases, ERP, CRM, and other involved technologies.

In the era of the cloud, lock-in is largely minimized. It’s much easier for a company to get away from an app, system, or tool that’s not working for a number of reasons. For one, the switching costs tend to be smaller, although not non-existent. Also, contracts tend to be much shorter, maybe even non-existent. Data-migration tools have evolved a great deal over the last two decades.

The end result? Now more than ever it’s easier for people to try out different tools. Mobility, cloud computing, Freemium, web services, and open source software mean that it’s easier than ever to avoid vendor lock-in.

So, what does this mean? Especially in the technology world, your product has to work well and immediately. Alternatives to just about everything abound. Few busy consumers and small business owners want to fiddle with settings just to get basic functionality to work. Technology should just work. Period. Does yours?

philanimated

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