Session, October 2008 eChallenges e-2008 Copyright 2008 Insert Org Logo in Master slide Software as a Service (SaaS) Through a Grid Network: Business and Legal Implications and Challenges Davide M. Parrilli Interdisciplinary Centre for Law and ICT (ICRI), K.U. Leuven, IBBT Belgium

Session, October 2008 eChallenges e-2008 Copyright 2008 Insert Org Logo in Master slide Motivation, problem area Provision of SaaS in a Grid environment Lack of business and legal models for exploiting Grid technology at its full potential from the various industry sectors: need to fill this gap. Is the SaaS delivery paradigm the most promising business model for providing Grid services? Business and legal implications must be assessed together: new and original approach.

Session, October 2008 eChallenges e-2008 Copyright 2008 Insert Org Logo in Master slide Research Objectives Impact of Grid applications and resources offered with the SaaS model in existing and new markets (investments, market entrance, competition, pricing, etc); SLAs: legal assessment and proposal of new legal schemes; Other economic issues that need to be taken into account by the new players (network externalities, pricing schemes, incentives etc) Legal issues: contractual framework, proprietary rights and licenses, confidentiality and liability.

Session, October 2008 eChallenges e-2008 Copyright 2008 Insert Org Logo in Master slide Research approach, Methodology BEinGRID projectObservation of the findings and experiences achieved in BEinGRID project: cross-analysis of 18 real-life Business Experiments, analysis of their business models and exploitation plans as consultants; literatureReview of the literature on the topic: no statistic on the Grid application delivery models used by the industry; lack of legal analysis.

Session, October 2008 eChallenges e-2008 Copyright 2008 Insert Org Logo in Master slide Major Outcomes/Results (I) SaaS should be preferredGrid applications should be delivered in a different model from the traditional on-demand one: SaaS should be preferred (especially by SMEs and home users). Grid trustGrid technology is most-of-all seen by the industry as a very promising solution to overcome performance- associated problems at a lower cost than today: the BEs are moving to the SaaS model – higher level of trust gained towards the Grid capabilities such as the SaaS model. But…there is still a lot of way to pave through a more global acceptance of the SaaS paradigm for next generation services (including the Grid ones).

Session, October 2008 eChallenges e-2008 Copyright 2008 Insert Org Logo in Master slide Major Outcomes/Results (II) Benefits of the SaaS model: New markets and new compound services built for smaller service components; more competitionLess investments needed by SMEs for software licenses and/or computational infrastructure: market entrance barriers are reduced – more competition; Service providers can expand their customers’ base and product offerings.

Session, October 2008 eChallenges e-2008 Copyright 2008 Insert Org Logo in Master slide Major Outcomes/Results (III) Furthermore: Network externalitiesNetwork externalities: each component in the environment adds value to others and to the whole product: need to create incentives for developers and to share the revenues. Pricing schemePricing scheme: necessity to develop new, flexible and dynamic schemes. Also to define a monetary value for resources (the “Grid dollar”): further analysis required. SLASLA: the client will require and expect from the Grid a better level of services: limitation of clauses on inoperability, inaccessibility, breakdowns for maintenance or upgrades, more supplier’s liability for congestion of the servers: should SaaS be always available?

Session, October 2008 eChallenges e-2008 Copyright 2008 Insert Org Logo in Master slide Major Outcomes/Results (IV) Legal issues The contract that encompasses the SaaS model is, in general terms, the ASP agreement: the software provider is the owner of the software (asset for the provider, liability for the customer). object codeCode provided to the client: in a typical SaaS scenario it will be the object code rather than the source code. confidentiality obligationsPivotal role of confidentiality obligations: no disclosure! Liabilitynon or bad provisioningLiability for non or bad provisioning: the use of the Grid should reduce the risk, extended burden of liability for the software provider. RemediesRemedies: Service Credits, damages, termination of the contract.

Session, October 2008 eChallenges e-2008 Copyright 2008 Insert Org Logo in Master slide Conclusion and outlook Clear tendency towards increasingly complicated and rich business scenarios and models as regards SaaS; Grid is a very promising technology; legalFrom the legal point of view Grid is not neutral: the provision of SaaS in a Grid environment alters the very content of the SLA and of the ASP agreement (level of service, liability, etc); balance the riskNeed to balance the risk (non or bad compliance) between software provider, Grid provider and end user in a new way: the traditional ASP paradigm is not able to encompass all the novel elements typical of a Grid scenario.

Session, October 2008 eChallenges e-2008 Copyright 2008 Insert Org Logo in Master slide Thank you for your attention! Davide M. Parrilli Interdisciplinary Centre for Law and ICT (ICRI), K.U. Leuven, IBBT (Belgium)