Peer-to-peer vs Hosted Services (or why we are not a Web 2.0 company)

The notion that all software will eventually be delivered as hosted services has become something of an idee fixe du jour among the technical punditry. Everyone is scrambling to get on to the Web 2.0 bandwagon, in ways that are reminiscent of companies rushing to add the ".com" moniker to their names just a few years ago. If you aren't delivering a hosted service, it is assumed that you "just don't get it".

So, why isn't Kerika a hosted service yet? Why are we bothering to deliver an application to our users instead of just creating a bunch of jazzy web pages like every other bubbly entrepreneur in flip-flops?

The answer is simple: our prototypical user has a laptop and tends to move around a lot. Sometimes he is working from his office, sometimes she is working from a coffee shop, sometimes from home or a commuter train. And our user doesn't always have reliable and cheap Internet access: even though we have a proliferation of hotspots across urban areas, and wireless access through cellphone providers, these are not quite ubiquitous yet, and they are certainly not cheap.

In this scenario, we feel our users are best served by always having a complete set of project files and artifacts, without having to rely upon gaining access to a remote server. Kerika's peer-to-peer technology ensures just that: every member of the project team always has a complete set of project documents.

Another problem with hosted services is that very few people are always self-disciplined in not keeping duplicate files on their laptops. We have observed that even where there is an "official" central repository of files, e.g. a SharePoint portal, individual users tend to keep duplicate versions of key documents on their own machines, and these inevitably get out of synch with the "official" versions that are sitting on the central servers.

So, if people are going to keep local files anyway, why fight our users? We prefer to support our users the way they actually work.

Kerika's peer-to-peer model offers a couple of other key advantages:

1. There is no single point of failure. If your machine gets trashed, the project team can continue working, and you can restore all your old files from your teammates. In a hosted model, if the server is down, the project comes to a halt.
2. Greater privacy: the Web 2.0 business model is implicitly based upon serving up "targeted advertisements", which inevitably means a loss of privacy. All hosted services companies that offer so-called "free software" have automated ways of scanning your emails, your documents, everything that you do so that they can figure out just what advertisements they should display -- after all, this is a critical element of the Web 2.0 business model. With a peer-to-peer model you can work within a "ring of trust" consisting of machines and people that you select as part of your workgroup.

This is not to imply that we would never offer a hosted version of Kerika in the future, but for now, we think there is a good argument to be made in favor of the peer-to-peer model.

What do you think?