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IaaS: A Wolf in Sheep’s Clothing, or Just Evolution in Progress? | Gaining Altitude in the Cloud

Our discussions with CIOs of large enterprises have made it clear they are seeking cloud-based infrastructure services (Infrastructure-as-a-Service, or IaaS). However, recent interactions we have had with a variety of service providers – name brand firms and cloud upstarts alike – revealed that the answers enterprise buyers receive from providers about their offerings are all over the map. Indeed, the answers sometimes even differ across proposed solutions from different solutioning teams from the same provider. The alignment of service offerings fit with cloud principles is often quite mixed; for example:

  • Term. Proposals ranged from multi-year contracts with take-or-pay minimums to selling IaaS on an hourly basis with no volume commitments whatsoever.
  • Service levels. Proposals ranged from “what-you-see-is-what-you-get” to traditional “let’s negotiate” SLAs.
  • Pricing models. Proposals ranged from pure consumption-based pricing to approaches with very substantial fixed base load requirements and little ability to scale downward to hybrid models with fixed and variable components.

Two other observations left us puzzled by service providers’ go-to-market positioning. First, (although not a definitive pattern) is what could be interpreted as some “traditional” service providers trying to overlay a cloud veneer on their offerings (contractual camouflage?) to play in a rapidly growing space. And second, some of the cloud pioneers that possess robust cloud services delivery capabilities are fogging the picture by building decidedly non-cloud features into their solutions, apparently in an attempt to look more like traditional outsourcing players.

Neither of these approaches appear to be particularly appealing to enterprise buyers, and understandably so. The enterprises are often implementing near-term roadmaps that address their organizations’ need for a mix of environments –dedicated, private, and private/public hybrid cloud that fit their distinctive workload characteristics and business needs. But providers are presenting little clarity on how their IaaS solutions support the buyers’ end state models or contractual requirements.

Service providers must tune their offerings to the situation and offer real cloud-based solutions when that is the “ask,” and traditional solutions when such are indicated. Enterprises need to ensure they clearly define their roadmaps to discern when a solution fits and when it doesn’t. When either the providers or the enterprises try to blend what they are trying to accomplish, they are likely to end up with a cocktail that could leave those on the other side of the transaction with a hangover.

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