It’s Getting Crowded in the Cloud
Every day we see more and more players enter the ‘cloud’ market. Be that vendors offering an on-demand/subscription based model, partners positioning data center virtualization solutions as ‘private cloud, or service providers announcing new public cloud offerings. As the cloud lexicon becomes more confusing, we’re seeing more chaos in the market – which of course brings opportunity. But, is anyone buying? Gartner states that from their recent research of CIOs, one-third of respondents expect to be using cloud in the next 18 months. What kind of cloud isn’t defined.
We still get a lot of requests to clarify what cloud means – private, public, hybrid? It seem as though you can buy anything-as-a-service: infrastructure as a service (Savvis, Terremark); platform as a service (Force.com; VMware); Software as a service (Google, Microsoft Office 365); IT as a service (Matrix, Continuum); collaboration as a service (Jive); storage as a service. You name it – you can buy it on a subscription usage model.
The cloud world is crowded with options. And, how you might procure those services via the cloud is just as crowded and confusing. Most, if not all, telecom carriers are offering ‘cloud’ services to end customers – ATT, BT, and NTT as a few examples. There are also aggregators that bundle together solutions, offer negotiated SLAs, a help desk among other services. We are seeing the traditional IT distributors (Ingram Micro and Tech Data for example), begin to play here, and compete with other aggregators like Xerox Cloud Services (formerly ACS) and master agents, who have long standing relationships with telco’s. These ‘wholesale’ organizations engage host of companies that white label cloud solutions – what the traditional IT industry would call reseller. They negotiate the contract with the customer, commit to an SLA, and ‘resell’ someone else’s cloud services – branded as their own. Also in the ‘resale’ space are integrators that might bundle together applications (like Gmail and Workday). Integrators create an overall solution for a specific business need and focus more on the process changes than the technology. And on top of all those routes-to-market is the agent model. These entities sell someone else’s products/services and simply maintain the customer relationship. Agents need sales and marketing skills, get a recurring revenue stream (not a lot) and build someone else’s brand. Of course these entities range in size from two guys and a truck to large formal organizations.
All of these models are overlapping with strengths converging from traditional IT services and bumping into the telcom business. Thus creating more intricacy in partner types and frameworks. Gone are the days of a linear route-to-market: distributor -> reseller -> customer. It’s all a jumble with complex and confusing engagement structures, service offerings and value propositions. Technologies may be converging (à la unified communications), but the channels are getting much more diverse and disjointed. Who wins? The next two years will tell us who will emerge from the crowd.