When you talk about cloud, a lot of the emphasis on business transformation happens at the customer level. The funny thing is that the first group of players in the cloud market, the technology and service providers, are the ones who are going to feel the need to re-evaluate their businesses first. It will also help determine which of these providers will make it through the early adoption of cloud and continue to be a player in the established cloud market, and who will either end up as an acquisition by one of these organizations or will simply decide to focus on other business lines.
For those who decide to stay in the cloud game, they will need to re-evaluate what role they plan to play in helping organizations adopt cloud technologies and services. Personally, I see the cloud dividing technology providers into two major groups: enablers and providers. Here’s why.
When it comes to cloud, businesses really have two major adoption paths. Larger organizations might look to build their own internal cloud to support their business, whereas smaller organizations might prefer the outsource model. So what does this mean for providers in either group?
For cloud service providers who enable organizations through providing cloud services such as IaaS, PaaS, and SaaS, along with additional services such as data replication, security and network, cloud is a great way to evolve legacy services. The most dominant players in this area will most likely come from the traditional telecommunication providers who are looking to create more value from their network services, or from managed service providers who normally support organizations with security or data services. These organizations will provide value as service brokers or aggregators for businesses who just want a single source for all their services and avoid issues with service conflicts such as incompatible platforms etc.
For technology providers who are focused on helping organizations build their own clouds (which will also be a large market, especially in early cloud adoption for large enterprises), the key benefit that these players can provide is through consulting and resource portfolios that support cloud as a market. Traditionally these providers have sold hardware and software in silos such as storage, networking, security and unified communications. These porfolios should be redesigned to reflect the market changes such as heavier emphasis on virtualization technologies (which would include virtualized UC and security for example), cloud platform (cloud environment solutions for storage and networking) and a wealth of services such as implementation and architecture services to help customers transform their current business models to reflect cloud.
Cloud is going to demand a huge shift in business models, not just for customers, but for technology and service providers. The problem is that these providers have been running their organizations in the same manner for the last few decades and so moving to a new way of doing business will take time. The first organizations to leverage these new business models will be the ones who will probably make the most impact in the cloud market.