Blog post

Cloud: Proceed With Caution — Brokerages Can Help

By Benoit Lheureux | June 20, 2011 | 1 Comment

SaaS IntegrationIntegration BrokerageEcommerceCSBCloud Services IntegrationCloud Services BrokerageCloud ComputingCloudB2B

July 19th update — updated below with reference to 2nd of two CSB case studies, on Mohawk – bjl

June 28th update — updated below with reference to 1st of two CSB case studies, just published — bjl

————————————————— Original post follows:

I’ve just returned to the US from London where we held our annual Application Architecture, Development & Integration Summit event, which this year prominantly featured a lot of research on cloud computing. One of my sessions was on cloud services brokerage, which I kicked-off with this picture:

It’s for a street I’d not seen before in a recently developed part of Phoenix, AZ (search for “Cloud Road, Queen Creek, AZ” in Google Maps). I took the pic right before my London trip, on my drive home after picking up dinner for my wife and I. She knows I cover Cloud computing and that I’m fond of metaphors so when I showed her the pic she immediately asked, “so, … are you running with ‘Stop!’ — or ‘Go!’?” Pithy, but indeed — which?

But it’s not like we have much choice, do we? Whether you believe the Gartner Cloud computing forcast (this and other Gartner research references require a subscription) or have simply been ‘following the money’ in the increasing supply-side investment in and — more importantly — IT consumer spend on cloud computing, it’s clear that answer is ‘Go!’. But the recent problems reported by many companies including respected organizations such as Amazon and Sony has many folks also calling for a ‘Stop!’ along the way to re-assess the risk / benefit trade-offs of this new IT consumption model. Nevertheless, there’s no compelling evidence that cloud computing adoption will be substantially inhibited by such IT (and mass consumer) ‘growing pains’. While no silver bullet for IT, Cloud computing is certainly here to stay and we expect rapid adoption to continue.

So what about my point above about “re-assessing the risk” of cloud computing adoption? One aspect of this is simple: if you need help, who are you gonna call?

Increasingly, system integrators, value-added resellers, B2B e-commerce and various other IT service providers are being tasked with answering this call. By creating new cloud-centric IT service offerings or cloud capabilities for traditional IT service offerings many IT service providers are quickly assuming the cloud services brokerage role — see Cool Vendors in Cloud Services Brokerage, 2011.

Particularly in B2B ecommerce we’ve created a roadmap for providers to add the cloud services brokerages to their traditional B2B role. These providers are competing ever more aggressively to consolidate the traditional B2B integration services market and to better position themselves to also deliver cloud services brokerage. Some noteworthy events in 1H11 include:

On the consumption side of cloud services brokerage I’m having ever more discussions with clients who are looking for help on IT projects that involve a combination of traditional e-commerce integration and cloud services consumption. For example, in London I spoke with an architect from a European manufacturer. We first talked about traditional e-commerce B2B, then about SaaS integration — and then we talked about (to his surprise) the viability of single-sourcing a solution for both requirements from a B2B provider that was also a CSB. No, really.

And there-in lies the rub, doesn’t it? While most companies have a pretty good idea of what solutions are available to them for traditional e-commerce, few clearly understand what approaches are available to address SaaS integration. Even fewer, still, know how solutions like integration PaaS and cloud services brokerage can help. My colleague, Massimo Pezzini, has taken the lead on our iPaaS research to advise companies who prefer a technical (‘do it yourself’) approach to SaaS integration, and I’ve re-focused nearly all my attention on the IT services (‘outsourced’) approach, aka CSB.

We’ve already published a pretty good CSB body of research, addressing such basics such as our CSB definition, reference model, vendor landscape, etc. But we need to make it more ‘real’ — we need examples. Thus I’m happy to report that in the next couple of weeks we’ll be publishing two CSB case studies:

I’m grateful to both organizations for the time they’ve spent with me to understand their business, the problem they were solving, and the role that CSB had in helping address that and their adoption of cloud computing. These bits of research will provide insight into the CSB role and begin answering the cloud computing challenge question above — when you need help, who are you gonna call? In 3Q11 Daryl Plummer and I will also publish our 2nd annual CSB special report in which we’ll cast more light on CSB use case scenarios, the CSB landscape, the role of CSB in the cloud services value chain, etc.

So, yes, ‘Go!’ — cloud computing is here to stay. But, ‘Stop!’ — if you’re like many companies cloud computing will be a bit tricky to tackle alone. CSB can help.


— bjl

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  • Our experience with CSB enablement has been that telcos were first to market in terms of adopting, but the notion of operating a marketplace of cloud services has transcended into large ISVs wanting to create their own partner ecosystems and large distributors who want to ensure that they remain the central clearinghouse for their VARs as IT buyers start driving the channel to cloud services. Enterprise IT will play out as a CSB in their own right, but right now they seem overly-focused on building out their private clouds vs. considering how to consolidate usage/delivery of external public cloud services, which are oftentimes procurred behind IT’s backs by employees.

    Remember the server proliferation issue from many years ago? That issue beget server consolidation, which in turn beget data center virtualization. Now the issue is much greater because the barrier to purchase for a corporate employee is orders of magnitude cheaper with cloud services than it was with servers. Plus SOX, EU data privacy, and a host of other regulatory requirements have made the risks much higher for not providing the means or the incentives to ‘consolidate cloud sprawl’ within the enterprise.