Cloud service providers have a nasty habit of focusing on the technology that they offer to their customers without considering how to solve the problems of billing for the technology until after it is in place. At best, this results in a nasty surprise for the accounts department. At worst, it results in the inability to monetize a new product.
One main problem area is when cloud service providers underestimate the likely complexity of their product catalog. They often think they are selling disks, servers and networks, and wonder what is the challenge with having three products. In our experience, very few customers end up with such simple set ups.
Here are five reasons why:
1. Cloud service providers often want to make some products available to some customers, and other products available to other customers. Those might be the same technical products, but sold at different prices or with different billing plans. We support this in Flexiant Cloud Orchestrator by distinguishing between a product and a product offer. Our tagging system allows products to be made available to groups of customers.
2. Whilst some providers are happy with ‘we charge $x per gigabyte per hour’, others offer specific configurations of machine, and have pricing that may not be entirely linear. For instance, some service providers might be happy for the customer to configure any amount of RAM on their virtual machine from 512MB to 16GB, charging at $0.01 per GB per hour; but another might want to offer specific combinations of RAM and CPU, discounting the larger machines appropriately. This increases the size of the product catalog. We can cope with both possibilities by using a system called ‘configured values’, which can be nailed down by the licensee either when the product offers are created, or left to the end user to configure.
We strongly believe a successful roadmap to offering cloud services involves a great level of integration. You as a service provider will be asked to provide all sorts of services to your customer base, in order to help them get the most out of the new cloud computing consumption model. To get there, you’ll need a solid technology foundation, good knowledge of the market and lots of time to develop integration.
We believe Flexiant Cloud Orchestrator is the foundation layer capable of that robustness, scalability and elasticity that is required to build services that are ready to cope with increasing demand. And on the integration side, we are constantly working to make our platform interoperable with other great technologies, thus making your life much easier, while still having a broad number of choices. Sounds great doesn’t it?
Responding to our customers’ demand, we have incorporated specific integration modules for Hostbill and WHMCS. These two popular customer management, product catalogue and billing systems are generally adopted by service providers that want to offer an online marketplace for all their cloud services, obviously including those delivered by Flexiant Cloud Orchestrator.
Billing systems for service provider cloud products suffer a unique set of challenges due to the sheer amount of data they create. This blog sets out some of those challenges.
Cloud products are generally billed by usage. This means it is necessary to measure usage of a large number of virtual resources on the platform; for example the platform will typically measure how long each server is running, how many bytes have been transferred through each virtual network interface card, and so on. The sheer amount of data collected can be enormous.
To illustrate the data overload point, Flexiant Cloud Orchestrator measures between 20 and 30 values per running server, and that measurement process is carried out roughly every ten minutes. For a moderate size cloud platform running 10,000 servers, which is about 36 million records an hour, or a billion records per month – if you kept them all. To have any hope of billing accurately, you need to ensure your metering system can scale to handle the above data.
differentiateA recent TechTarget survey showed that while service providers are continuing to invest in conventional infrastructure, many are still slow to adopt more specialized or innovative technologies like cloud orchestration. The article reported:
Similar patterns appeared in response to questions about other specialized or emerging technologies. When asked about their plans for self-service portals, orchestration software and cloud management platforms — all of which are widely discussed in the provider market — about 40% to 50% of respondents said they were evaluating the technologies, while about 20% said they had no plans for any of the three product families. Between 7% and 12% had already bought such products, while about 10% said they were bypassing vendors and building the technologies in-house.
Initial results from our survey on the cloud service market show that of the respondents, self-service provisioning is an important capability many are offering their customers now (70%). However, in future, a high percentage of respondents (63%) say that granular metering and granular billing will be an important capability to offer customers.
Do you agree or disagree? Take the survey below or click here to open in a new window to share your opinion. The quick nine question survey seeks to evaluate the cloud service market from the providers point of view so you can better understand where you might see your competition now and in the future. The results promise to reveal what cloud services are currently offered and will be in the future, where international expansion is expected and what capabilities, you the service provider, require in your quest to capture the significant market opportunity.
The survey will only take a few minutes of your time. Upon completion you will be asked for your email address. If you would like to see the results once analyzed, please complete.