CloudBees CEO Sacha Labourey on the strength of the PaaS market

It’s been a very good first half of the year for Java-based platform as a service (PaaS) provider CloudBees. The Belgium-based cloud company reported a revenue increase of 148% in the first two quarters of 2013, as well as a 135% increase in its customer base.

The news, which CEO Sacha Labourey describes as “definitely a great step for us”, could also be seen as more affirmation of the sharp rise in the PaaS market.

Almost every recent research paper you come across will mention it.

Market Monitor, a service of 451 Research, recently forecast that PaaS would be the fastest growing area of cloud computing, with a compound annual growth rate (CAGR) of 41% through 2016. Cloud overall would have a CAGR of 36%.

TechNavio, in May, put the CAGR at near 50%, with their beancounters expecting the global PaaS market to hit $6.45bn by 2016 and the fastest growth being in application infrastructure and middleware PaaS.

And back in June, the Synergy Research Group revealed that infrastructure as a service (IaaS) and PaaS service revenues surpassed $2bn in the first quarter of 2013.

Yet Labourey notes a word of caution, telling CloudTech that, as fast as PaaS grows, it won’t ever overtake the numbers of IaaS.

“IaaS will remain an underlying and very important service for PaaS,” Labourey says. “I think the margin will remain very good on PaaS because there are good ways to differentitate.

“I think the analysts initially were a bit too optimistic as to when PaaS would really hit their growth phase, but we’re definitely seeing the first signs of this happening,” he adds.

CloudBees’ solution incorporates Java into PaaS, allowing users to deliver apps continuously on the Java framework.

But Labourey wants to avoid confusion about the PaaS market – specifically, that it’s not for startups. Writing for Venture Beat earlier this month, Labourey explained his view that PaaS could be a household name in two years, but only if companies understand it and how to utilise it to their advantage.

Labourey notes the enterprise use case at CloudBees, and their potential USP. “We have traditional enterprises and bigger enterprises moving to the cloud, and the way we do that is not by moving legacy or existing assets to the cloud, it’s really about projects and workloads,” Labourey explains.

He adds: “Time to market is very important, and so the first thing we have to sell for these companies is ‘how do I get access to the data?’ Their crown jewel, their core data is still on-premise, or maybe on Salesforce, so you need a way to synchronise, migrate data from one system to another.

“However this is not entirely new – you can see a bunch of companies offering this kind of service in the public cloud. Where I think we can bring some clear differentiation is having both this integration layer, as well as having a PaaS sitting side by side.”

But aren’t a lot of these big enterprises still scared of the public cloud?

“I think there’s definitely still some fear of public cloud,” Labourey notes. “I think it’s just fair practice from traditional IT to be sceptical.”

For Labourey, it’s not an issue of public versus private; it’s an issue of ‘core IT’ – the existing assets, ERP, CRM – against ‘fast IT’, such as mobile application deployments.

“If you have a mobile project, you want something fast, and for this you need to go to market tomorrow and create fast deployment,” Labourey adds.

“So that happens particularly on the public cloud, the PaaS. Instead of saying ‘is it public cloud or private cloud’, these companies are saying ‘it is what it is’.”

Labourey also notes that the NSA PRISM debacle – in which the US cloud industry could lose up to $35bn if you believe what you read – adds to this ethos.

“From a communications standpoint I think it’s bad news, because I read a lot of stuff out there trying to detect public cloud as not being secure, as being risky,” Labourey says. “That’s definitely bad news from a communications standpoint. Factually, I don’t think it changes much.

“I think if you want to have a secure infrastructure, it’s nothing to do with public or private. It has everything to do with the policy you put in place and the tools you put in place.

“I think it’s a healthy wake up call,” he adds.

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