NetSuite climbing the customer chain

NetSuite CEO Zach Nelson said that the company was seeing an upward shift in the size of companies purchasing its products.

NetSuite CEO Zach Nelson (Credit: Delimiter)

A few years ago, Nelson said, 80 per cent of customers would have been moving to NetSuite from QuickBooks, a popular accounting product for the smaller end of the market. Now, around the same amount of customers are moving from Microsoft's Great Plains, a product more suited to larger companies, which Nelson called a "stone age hair ball".

NetSuite was "moving up the chain", according to Nelson.

"In most cases, we're replacing something," he said. "The profile of customer is changing rapidly in terms of what we're replacing."

The mid-market segment the company was entering had enormous potential, according to Nelson, because the market was fragmented.

However, NetSuite had no plans to move further up the chain onto the enterprise scene.

"We don't really want to replace the $100 million instances of Oracle," he said, adding that he only expected enterprises to use NetSuite for their subsidiaries.

The scaling up of NetSuite's customer size has been seen across the globe, according to Nelson. There have also been Australia and Asia-Pacific trends.

Nelson said that Asia and Australia were driving customer moves to the company's OneWorld product, which allows multinational companies to manage many subsidiaries from the one cloud platform. The company released the newest version of the product yesterday.

The take-up rate was much higher in Australia than in the US, according to Nelson. He put this down to the fact that the Australian market wasn't big enough to fully sustain many companies, meaning that they had to move overseas and market their products there.

NetSuite announced yesterday that it had reached 600 customers in Australia and New Zealand. The company also announced the appointment of a new Asia-Pacific head, Mark Troselj. Troselj has held positions in Dell, Sun Microsystems, SAP and Telstra.

Datacentres and the NBN

Nelson said that a datacentre for Asia Pacific was definitely on the cards, but he couldn't say yet where it would be placed.

Its placement would depend on factors such as customer density, he said. NetSuite hadn't carried out the necessary analysis to make the decision as yet.

The National Broadband Network wouldn't necessarily tip the scales in favour of Australia, according to Nelson.

"That would certainly make it super-fast for Australians," he said. However, domestic speeds weren't the most important consideration for datacentre placement, but instead which locations had the best connectivity undersea.