The market for cloud infrastructure as a service (IaaS) is in a state of upheaval, as many service providers are shifting their strategies after failing to gain enough market traction, according to Gartner. Global spending on IaaS is expected to reach almost US$16.5 billion in 2015, an increase of 32.8 percent from 2014, with a compound annual growth rate (CAGR) from 2014 to 2019 forecast at 29.1 percent, according to Gartner’s latest forecast.
Analyst Lydia Leong said that “The sky is not falling — customers are getting great value out of cloud IaaS — but the competitive landscape is shifting. Few providers have the financial resources to invest in being broadly competitive in the cloud IaaS market.”
On the plus side, we continue to see significant growth in public cloud IaaS. In 2014, for the first time IaaS workloads surpassed the growth of on-premises workloads (of any type). Gartner’s 2015 CIO survey indicates that 83 percent of CIOs consider cloud IaaS as an infrastructure option, and 10 percent are already cloud-first with cloud IaaS as their default infrastructure choice.
Some service providers are opting to launch an entirely new cloud IaaS platform, make substantial changes to their current platform or move to providing managed services on leading cloud IaaS platforms. Others have indicated that they intend to discontinue or significantly reduce their investment in their cloud IaaS offerings, and others intend to eliminate or replace them, according to Gartner.
“We urge buyers to be extremely cautious when selecting providers; ask specific and detailed questions about the provider’s roadmap for the service, and seek contractual commitments that do not permit the provider to modify substantially or to discontinue the offering without at least 12 months’ notice.”
We believe that with this market warning, service providers need to beware. Customers are going to expect more from you including a long-term strategy for survival. No company wants to put their applications or data in your cloud only to have their cloud provider disappear.
Here are two things we believe every service provider needs to prove to a customer they are here to stay.
- A Mature, Reliable and Feature Rich Cloud Management Platform
Customers want the consumer experience across the business and that includes how they are managing their cloud. They want a slick UI, drag and drop and easily provisioned services. But they want more. They want value-added services like infrastructure blueprints to help cut down on the repetitive process – after all isn’t that what your cloud orchestration solution should help to achieve?
We suggest you look at Flexiant Cloud Orchestrator. It is a mature, reliable and feature rich cloud management platform that with its new UI released in version 5, gives your customers a great experience. Better yet, it is not just a one trick pony. It arms you with the tools to differentiate to generate more revenue, offer new services and extend the platform to other value added vendors like Mailchip, Zapier, PayPal, QuickPay, Loggly, Twilio, Zendesk, Mixpanel (and the list goes on).
- Make the Most of Other Cloud Vendors
Leong said earlier that few providers have the financial resources to invest in being broadly competitive in the cloud IaaS market so why not make the most of other vendors? What if you could offer your cloud services and when a customer suggests using another vendor like AWS or Microsoft, you easily enable that for them? Even better, you do it all through one UI so that the customer gets the same experience regardless of the cloud. This will give your customers and their DevOps teams the fastest way to deploy and automate applications consistently across multiple clouds.
Research shows that IT decision makers are unwilling to deal with the headache involved in juggling multiple hosts – a single provider must offer hosting for every vendor a client uses and that 48% plan to deploy six or more cloud services. You need a solution that allows you to be that provider and give that access to six or more cloud services (including your own).
Here we suggest evaluating Flexiant Concerto. It gives you the ability to deliver multiple clouds to your customers including your own while retaining your relationship and without having to put yourself in a financial hole to do so.
Your prospects and customers are going to be more savvy as they ensure the vendor selected is here for the long-term. Ensure you are one of those vendors by arming yourself with the cloud orchestration and multi-cloud management solution to not just survive, but thrive.