Cloud computing hubs will become increasingly data-centric

By Laurent Lachal, Senior Analyst, Ovum Software

In 2013 Trends to Watch: Cloud Computing, we show that cloud computing platforms are increasingly approached not just as technology delivery platforms but as ecosystem hubs for cloud service providers, consumers, and their respective channel partners. These hubs are increasingly data-centric.

Ecosystem services will make or break cloud service providers

From the start Ovum has emphasised that cloud computing platforms are not just technology delivery platforms but are also business platforms.

We have stressed that they need to deliver ecosystem services consisting of marketplace services, business services (for vendors in the marketplace to manage their customers, send bills, and get paid) and community services (for customers to provide reviews and feedback on a vendor and its partners’ services, for all sides to interact with one another via forum, wikis etc.).

History is proving us right: cloud computing ecosystem services are becoming increasingly important as cloud service providers increasingly compete not just via the services they offer but also via the ecosystem they have managed to build around them.

Many do not realise it yet but ecosystem services are already more important for the long-term success of a cloud computing offering than technology services.

The cloud computing middleman is not dead; quite the contrary

When it first emerged, cloud computing led many to believe that it would be the death of the middleman, as many cloud service providers went directly to the customer.

Nothing can be further from the truth.

The middleman is not dead. Infact, he will play an increasing role in the building of an increasingly sophisticated cloud ecosystem, with public as well as private cloud service providers endeavoring to expand the channel ecosystem to grab market share.

Under the “cloud service broker” banner many industry analysts are hyping up the “return of the middleman” scenario to an extent that is rather bemusing.

However, it is true that large vendors are all busy pushing and pulling their indirect channel network partners (such as managed service providers, value-added resellers, and independent software vendors) into the brave new world of cloud computing via a variety of programs and incentives, as well as training and certification initiatives.

Large distributors are muscling in, with Ingram Micro, Tech Data, and Synnex in the US as well as Computerlinks in the UK launching in the past 18 months new organisations and programs to enable their reseller network to enter the cloud computing market.

Their efforts are paying off. A November 2011 survey of 112 UK Computerlinks resellers found that 49% had a cloud computing offering. A mid-2012 Ingram Micro survey of 1,000 channel partners found that 61% marketed between two and four cloud services (and 24% more than five).

Overall, vendors are finding it difficult to push channel partners, and channel partners are finding it difficult to make the transition.

IT and telecoms resellers have big cloud computing ambitions, but their cloud computing business is growing relatively slowly. They are all experiencing business, skill, and margin challenges and are having trouble keeping up with the increasing sophistication of cloud computing service usage by the enterprise. Ovum expects a lot of mergers, acquisitions, and partnerships in this area.

Data is the new cloud computing oil

Cloud computing services, and the (social, mobile) applications that cloud platforms underpin, generate a lot of data, which in turn requires cloud services and applications to make sense of it. This trend connects with, and fuels, other industry trends such as the Internet of things, open government data, consumerisation of IT, and Big Data.

Big Data technologies have passed the early-adopter phase among large internet and media companies, and in 2013 they will enter the early-adopter phase for mainstream enterprises based on a mix of public and private clouds.

While the attention of the market, under the “Big Data” banner, is currently mostly focused on technology issues, from 2013 from a cloud computing perspective there will be a growing interest in the cultural shift required by vendors and enterprises to turn data into a resource to manage and monetise, starting with efforts around data abstraction (from underlying IT systems), sharing (within and outside the enterprise) and valuation (via models from companies such as Accenture).

Some vendors have played the cloud data card early on; Microsoft’s Windows Azure data marketplace predates the Windows Azure application marketplace, for example.

However, the cloud data production, brokerage, and consumption ecosystem is still in the making and will continue to be in 2013 and over the next five years.

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