SDN Journal Authors: Daniel Gordon, John Walsh, Elizabeth White, Liz McMillan, Sven Olav Lund

Related Topics: @CloudExpo, Microservices Expo, Agile Computing, Cloud Security, @DXWorldExpo, SDN Journal

@CloudExpo: Article

The New Era for Service Providers

Eliminating the cloud IT nightmare for users, SMBs and enterprises

In their March 2013 report "Business Technology Innovation," Ventana Research found that 40 percent of companies attributed cloud usage to reduced costs, followed by improved efficiency of business processes (39 percent).[1] Though the benefits of the cloud, like business and social collaboration, are clear, many organizations are having trouble seeing past the potentially overwhelming transition to the cloud. Most enterprises do not want a one-size fits all solution, which requires them to manage multiple relationships, negotiate multiple contracts, maintain multiple payments, remember multiple passwords all with multiple service providers. Maintenance is already a challenge, and by adding the complexity of transition, cloud computing can easily seem like an IT nightmare.

Cloud Adoption from Different Perspectives
Users are ready to make the transition
A "top-down adoption" is a process when the CIO or IT department mandates the type of software that all of their employees must use. This centralized structure means that the ones choosing the software are not the ones using it day-in and day-out, which leads to buying decisions based on ease of support and feature lists instead of ease of use and real world functionality. Enterprise 2.0 is flipping this old model into "bottom-up adoption." Employees, who have been using consumer tools in their personal lives, now expect the same level of quality in the software they use at work. They are seeking out and signing up for whichever tools will help them the most, instead of relying on what IT gives them, and CIOs are often put in a position requiring them to follow along their fellow employees.

Historically, cloud services, SaaS or any new technology that enters the market at a similar price point follows ‘a bottom-up adoption.' For example Salesforce.com, launched well over a decade ago, initially wasn't selling into the upper echelons of organizations. Instead, they were selling to individual sales representatives. By selling to individuals, Salesforce.com was able to build up the momentum within each of their customer organizations, resulting in selling sideline licenses or subscriptions for their service. With the consumerization of IT, this type of sales model is becoming a trend. Users are seeing they can get easy, affordable access to capabilities and services that are not supported internally, and as a result, individuals don't have to spend months justifying the business case with IT in order to get the solution they need. From a user perspective, the cloud is a new paradigm that supports a ‘bottoms up' approach and offers the ability to work more efficiently.

SMB owners need clarity
TechNavio's analysts forecast the small and medium-sized business cloud market in the US to grow at a CAGR (compound annual growth rate) of 18.45 percent over the period 2012-2016.[2] Despite apparent growth, SMBs are also finding that cloud adoption is creating a lot of confusion around choosing the right service. When SMBs speak to an IT reseller, they find the reseller tries to sell them a new server, license or on-premise software the company doesn't want or need. When SMBs search for a cloud provider independently, they often feel like small fish in a big pond; providers don't always give the assistance organizations need and they are left to fend for themselves.

Enterprise IT Is Worried About the Resources Needed
With enterprise IT organizations, particularly from a governance risk, management and compliance standpoint, the cloud can be frightening, and whether it's resource allocation, data governance or policy enforcement, there is a lot to consider when moving to the cloud.

One of the realities in moving to the cloud is that IT should not be required to invest countless hours managing the data center. Whether it's a public or private cloud, resources can be compiled, utilized and abandoned without the active participation of data center management. For some, this can be somewhat unsettling.  With the adoption of any new technology, enterprises should re-evaluate their management style; this is particularly true for cloud adoption.  The cloud represents a fundamental shift in information technology, and it shouldn't come as a big surprise, that the old ways of managing and organizing IT infrastructure can no longer apply.

Why Should Service Providers Care About Cloud Adoption?
Most service providers sell traditional money making services like broadband, hosting, voice communication and networking services. Over time, all of these markets have become fairly saturated, which has led to price competition as traditional competitors battle for a finite market. As a result, service providers are forced to cut prices, leading to reduced gross margins and a significant impact to the bottom line.  The solution is to begin considering an alternative source of revenue. The business impact with this double sided competitive scenario is that increasing commoditization leads to declining profit margins; as there is more price competition, there is more customer churn which leads to market share loss.

Cloud Marketplaces Best Practices
Many service providers are evaluating their cloud marketplace strategy, and several are finding that aggregating and delivering a rich catalog of cloud services to current customers creates new lines of revenue. The checklist below can help ensure increased profitability and greater customer retention for your organization.

Six Cloud Portfolio Strategies:

  • Provide complementary third-party services - Increase customer/partner retention and profitability, as well as incentives for partners to add value to core offerings.
  • Bundle third-party services with existing core offerings - Grow market share via differentiated offerings.
  • Provide a unified usage experience across different vendor services - Extend brand visibility and innovation to end-users to drive complementary benefits.
  • Enable existing and new service channels - Increase channel loyalty and profitability.
  • Create a phased go to market approach, starting with current services - If you are a service provider, the first thing to consider is your current portfolio and customer segments, and then break down your strategy.
  • Start with basic services that do not require a lot of high touch selling - Offer multiple services like security, data backup and collaboration conferencing across multiple categories to help customers choose the segment that is right for them.

Eight Essential Cloud Market Platform Features:

  • Catalog management - Where service providers define the user interface of the cloud marketplace, onboarding different services from the data center, defining the services and price points, tracking costs and negotiating wholesale.
  • Self-service fulfillment - A complete and automated self-service capability, so that users can go through, pick different services from the catalog and provide payment information. The platform should then be able to provision users for the different clouds they have ordered.
  • Service and user provisioning - Service adapters provide provisioning and communication between the platform and different cloud providers. This is a key component for operating within the cloud marketplace.
  • Authentication, authorization & access control - Covers a large range of capabilities from role based access control, which is important if selling to large enterprises. In this instance, enterprise customers can govern from the admin interface to the platform, which allows users within the organization to use the service.
  • User and service administration capabilities - When an individual leaves any size organization, the administrator should have the ability to delete that user and de-provision them from the services they use. A key value is allowing the organization to unify administration and lifecycle management, offering various types of services within the organization.
  • Reporting and auditing - Important at all levels of the platform architecture, this should range from tracking the services that are selling and customer segments to auditing where data is going, which services are being logged into and which users have access to which services.
  • Helpdesk ticketing & support - The key for customers is a single point of support for all the different cloud services that they have chosen for their platform. Federated help desk support across the various cloud providers and aggregated into one platform is essential in assuring down time is limited and maintenance is seamless.
  • Billing, metering & chargeback - Application services tend to have a monthly user subscription fee, while other services lean toward a metered solution. A key benefit for customers is aggregating billing for all cloud services.

Increasing customer ROI
A cloud marketplace drastically improves the end user experience by providing a single point of access, discovery, user management and administration, which is important in terms of reducing the overhead cost that IT managers typically face. It also enables end users to aggregate their buying power within organizations, reducing the number of users going out on their own. Being able to audit how users are accessing servers, deleting employees from the entire cloud platform and reducing exposure to data loss are essential in centralizing and managing access to IT tools needed by each employee, and assuring that companies are compliant with regulatory standards.

Even with users, SMBs and enterprises looking for customized cloud service solutions, transition and maintenance could be enough for anyone to halt cloud adoption; however, with a proper platform, service providers can integrate or aggregate services, to provide a customizable, easy to deploy solution. Cloud Services Brokerages (CSBs) make cloud services more valuable because they work closely with cloud providers to get price breaks or access to more information about how a service works. A viable CSB can make it less expensive, easier, safer and more productive for companies to navigate, integrate, consume and extend cloud services, particularly when they span multiple, diverse cloud service providers.

The world of cloud computing has created a huge business opportunity for service providers to differentiate themselves. As the demand for cloud services grows, it's a natural fit for providers to take advantage of the growth and cater to the needs of their customers. Aggregation services like CSBs will help a customer navigate through the various cloud offerings, which is becoming an increasingly difficult task. For providers, it will increase their relevance and provide a growing revenue stream, something that a lot of organizations are currently looking to do in a saturated industry.[3]


  1. http://www.ventanaresearch.com/bti/
  2. http://www.reportlinker.com/p01095425/Small-and-Medium-sized-Business-Cloud-Market-in-the-US.html#utm_source=prnewswire&utm_medium=pr&utm_campaign=IT_Hosting
  3. http://it-tna.com/2013/05/17/jamcracker-if-it-aint-cloud-services-brokered-fix-it/

More Stories By Steve Crawford

Steve Crawford is Vice President of Marketing and Business Development at Jamcracker. He was formerly CMO for PKWARE, where he helped lead a turnaround that increased revenue growth by tenfold over a three-year period. Previously, he was with VeriSign during its growth from pre-IPO to over $2B in revenues, where he negotiated strategic alliances, launched its enterprise solutions product-line, and was responsible for its $200M service provider business. He has also led marketing and business development activities at Octel Communications and managed advanced development programs at Lockheed.

Comments (0)

Share your thoughts on this story.

Add your comment
You must be signed in to add a comment. Sign-in | Register

In accordance with our Comment Policy, we encourage comments that are on topic, relevant and to-the-point. We will remove comments that include profanity, personal attacks, racial slurs, threats of violence, or other inappropriate material that violates our Terms and Conditions, and will block users who make repeated violations. We ask all readers to expect diversity of opinion and to treat one another with dignity and respect.

@CloudExpo Stories
DX World EXPO, LLC, a Lighthouse Point, Florida-based startup trade show producer and the creator of "DXWorldEXPO® - Digital Transformation Conference & Expo" has announced its executive management team. The team is headed by Levent Selamoglu, who has been named CEO. "Now is the time for a truly global DX event, to bring together the leading minds from the technology world in a conversation about Digital Transformation," he said in making the announcement.
"Space Monkey by Vivent Smart Home is a product that is a distributed cloud-based edge storage network. Vivent Smart Home, our parent company, is a smart home provider that places a lot of hard drives across homes in North America," explained JT Olds, Director of Engineering, and Brandon Crowfeather, Product Manager, at Vivint Smart Home, in this SYS-CON.tv interview at @ThingsExpo, held Oct 31 – Nov 2, 2017, at the Santa Clara Convention Center in Santa Clara, CA.
SYS-CON Events announced today that Conference Guru has been named “Media Sponsor” of the 22nd International Cloud Expo, which will take place on June 5-7, 2018, at the Javits Center in New York, NY. A valuable conference experience generates new contacts, sales leads, potential strategic partners and potential investors; helps gather competitive intelligence and even provides inspiration for new products and services. Conference Guru works with conference organizers to pass great deals to gre...
DevOps is under attack because developers don’t want to mess with infrastructure. They will happily own their code into production, but want to use platforms instead of raw automation. That’s changing the landscape that we understand as DevOps with both architecture concepts (CloudNative) and process redefinition (SRE). Rob Hirschfeld’s recent work in Kubernetes operations has led to the conclusion that containers and related platforms have changed the way we should be thinking about DevOps and...
In his Opening Keynote at 21st Cloud Expo, John Considine, General Manager of IBM Cloud Infrastructure, led attendees through the exciting evolution of the cloud. He looked at this major disruption from the perspective of technology, business models, and what this means for enterprises of all sizes. John Considine is General Manager of Cloud Infrastructure Services at IBM. In that role he is responsible for leading IBM’s public cloud infrastructure including strategy, development, and offering m...
The next XaaS is CICDaaS. Why? Because CICD saves developers a huge amount of time. CD is an especially great option for projects that require multiple and frequent contributions to be integrated. But… securing CICD best practices is an emerging, essential, yet little understood practice for DevOps teams and their Cloud Service Providers. The only way to get CICD to work in a highly secure environment takes collaboration, patience and persistence. Building CICD in the cloud requires rigorous ar...
Companies are harnessing data in ways we once associated with science fiction. Analysts have access to a plethora of visualization and reporting tools, but considering the vast amount of data businesses collect and limitations of CPUs, end users are forced to design their structures and systems with limitations. Until now. As the cloud toolkit to analyze data has evolved, GPUs have stepped in to massively parallel SQL, visualization and machine learning.
"Evatronix provides design services to companies that need to integrate the IoT technology in their products but they don't necessarily have the expertise, knowledge and design team to do so," explained Adam Morawiec, VP of Business Development at Evatronix, in this SYS-CON.tv interview at @ThingsExpo, held Oct 31 – Nov 2, 2017, at the Santa Clara Convention Center in Santa Clara, CA.
To get the most out of their data, successful companies are not focusing on queries and data lakes, they are actively integrating analytics into their operations with a data-first application development approach. Real-time adjustments to improve revenues, reduce costs, or mitigate risk rely on applications that minimize latency on a variety of data sources. In his session at @BigDataExpo, Jack Norris, Senior Vice President, Data and Applications at MapR Technologies, reviewed best practices to ...
"ZeroStack is a startup in Silicon Valley. We're solving a very interesting problem around bringing public cloud convenience with private cloud control for enterprises and mid-size companies," explained Kamesh Pemmaraju, VP of Product Management at ZeroStack, in this SYS-CON.tv interview at 21st Cloud Expo, held Oct 31 – Nov 2, 2017, at the Santa Clara Convention Center in Santa Clara, CA.
Large industrial manufacturing organizations are adopting the agile principles of cloud software companies. The industrial manufacturing development process has not scaled over time. Now that design CAD teams are geographically distributed, centralizing their work is key. With large multi-gigabyte projects, outdated tools have stifled industrial team agility, time-to-market milestones, and impacted P&L stakeholders.
Enterprises are adopting Kubernetes to accelerate the development and the delivery of cloud-native applications. However, sharing a Kubernetes cluster between members of the same team can be challenging. And, sharing clusters across multiple teams is even harder. Kubernetes offers several constructs to help implement segmentation and isolation. However, these primitives can be complex to understand and apply. As a result, it’s becoming common for enterprises to end up with several clusters. Thi...
"Infoblox does DNS, DHCP and IP address management for not only enterprise networks but cloud networks as well. Customers are looking for a single platform that can extend not only in their private enterprise environment but private cloud, public cloud, tracking all the IP space and everything that is going on in that environment," explained Steve Salo, Principal Systems Engineer at Infoblox, in this SYS-CON.tv interview at 21st Cloud Expo, held Oct 31 – Nov 2, 2017, at the Santa Clara Conventio...
In his session at 21st Cloud Expo, James Henry, Co-CEO/CTO of Calgary Scientific Inc., introduced you to the challenges, solutions and benefits of training AI systems to solve visual problems with an emphasis on improving AIs with continuous training in the field. He explored applications in several industries and discussed technologies that allow the deployment of advanced visualization solutions to the cloud.
The question before companies today is not whether to become intelligent, it’s a question of how and how fast. The key is to adopt and deploy an intelligent application strategy while simultaneously preparing to scale that intelligence. In her session at 21st Cloud Expo, Sangeeta Chakraborty, Chief Customer Officer at Ayasdi, provided a tactical framework to become a truly intelligent enterprise, including how to identify the right applications for AI, how to build a Center of Excellence to oper...
"IBM is really all in on blockchain. We take a look at sort of the history of blockchain ledger technologies. It started out with bitcoin, Ethereum, and IBM evaluated these particular blockchain technologies and found they were anonymous and permissionless and that many companies were looking for permissioned blockchain," stated René Bostic, Technical VP of the IBM Cloud Unit in North America, in this SYS-CON.tv interview at 21st Cloud Expo, held Oct 31 – Nov 2, 2017, at the Santa Clara Conventi...
In his session at 21st Cloud Expo, Carl J. Levine, Senior Technical Evangelist for NS1, will objectively discuss how DNS is used to solve Digital Transformation challenges in large SaaS applications, CDNs, AdTech platforms, and other demanding use cases. Carl J. Levine is the Senior Technical Evangelist for NS1. A veteran of the Internet Infrastructure space, he has over a decade of experience with startups, networking protocols and Internet infrastructure, combined with the unique ability to it...
22nd International Cloud Expo, taking place June 5-7, 2018, at the Javits Center in New York City, NY, and co-located with the 1st DXWorld Expo will feature technical sessions from a rock star conference faculty and the leading industry players in the world. Cloud computing is now being embraced by a majority of enterprises of all sizes. Yesterday's debate about public vs. private has transformed into the reality of hybrid cloud: a recent survey shows that 74% of enterprises have a hybrid cloud ...
"Cloud Academy is an enterprise training platform for the cloud, specifically public clouds. We offer guided learning experiences on AWS, Azure, Google Cloud and all the surrounding methodologies and technologies that you need to know and your teams need to know in order to leverage the full benefits of the cloud," explained Alex Brower, VP of Marketing at Cloud Academy, in this SYS-CON.tv interview at 21st Cloud Expo, held Oct 31 – Nov 2, 2017, at the Santa Clara Convention Center in Santa Clar...
Gemini is Yahoo’s native and search advertising platform. To ensure the quality of a complex distributed system that spans multiple products and components and across various desktop websites and mobile app and web experiences – both Yahoo owned and operated and third-party syndication (supply), with complex interaction with more than a billion users and numerous advertisers globally (demand) – it becomes imperative to automate a set of end-to-end tests 24x7 to detect bugs and regression. In th...