“All in” with a public cloud: is it the right model for everyone?

Posted on: March 8, 2017 by Michael Endres

In the early days of enterprise IT, people often remarked that “whatever the question, IBM is the answer”. Fast forward several decades and now, whatever the question, the answer is usually the Cloud.

The next questions are: what counts as “the Cloud” and how should businesses get there?

One school of thought is that the only serious candidates are hyper-scale public clouds from a handful of providers, and the only rational option is for customers to go “all in”. In other words, make a deep commitment to a single provider’s platform and leverage it to the hilt.

We, however, think that the Cloud is a big and diverse place and that there is ample room for multiple approaches. The top tier public clouds do offer unique capabilities, but there is much to be said for the private clouds that many large organizations have invested in, as well as for the emerging vertical “industry clouds”.

Customers come in all shapes and sizes, with different business and IT needs. Going “all in” with a single, big public cloud may be right for many, but it is only fair to ask: is this “one size fits all” model right for everyone?

Public cloud “lock-in” is emerging as a big issue

Before it morphed into an IT revolution, IaaS cloud computing could be seen mostly as a new sourcing model for basic IT infrastructure, sold on demand over the Internet. Despite differences in services, support and tools, the players were delivering a “vanilla” product, and so concerns like proprietary lock-in and reversibility were not yet issues.

Today, public clouds are far from “vanilla”, with competition less about price and more about innovation. Providers like Amazon, Microsoft Azure, and Google have created massive services portfolios that aim to make cloud computing easier and more useful for customers. As providers, they have the additional advantage of raising the exit barriers. For example, AWS is a real innovation leader (and global Atos partner). Services such as its Amazon Kenesis Streams or AWS Lambda are both enticing and at the same time extremely ‘sticky’, with applications built on them essentially stuck. As a customer does more and more in a single public cloud, the skill sets of operations teams can become increasingly locked-in to the provider’s toolkit.

The result is that a deep “all in” commitment to a single provider’s platform makes migration of the business applications at best extremely difficult. Stated bluntly, the “all in” model translates into a level of lock-in and single supplier dependency not seen since the glory days of the IBM mainframe.

Doing what’s right for the customer

That said, the “all in” model may well be the best choice for many organizations.

One example is Evernote, which in 2016 left its own datacenter space to go “all in” with the Google Cloud Platform. Although still a small company, Evernote provides a popular note-taking and productivity tool to over 200 million users, and has been valued at over 1 billion dollars. The company wants to take its application to the next level, leveraging Google’s advanced technologies in Artificial Intelligence, including Natural Language Processing. For Evernote, going “all in” with Google made sense.

For large global companies, however, it’s another story. CIOs must manage, and transform, business critical information systems. Many have invested, and will continue to invest, in private clouds, because they deliver on the number one promise of the Cloud: business agility. IT governance is also a factor, as are concerns about security and compliance, including clear legal control of sensitive data.

Increasingly, these CIOs also want to leverage the capabilities of public clouds – such as virtually unlimited scalability and easy access to innovative services - but with the flexibility to choose what they want, from whoever they want. Industry clouds also offer new opportunities for CIOs.

In short, the Cloud is becoming even bigger and more diverse, with many services on offer. Only customers can choose what is right for them.

We need an alternative model

While the “all in” model does make sense for some, it is clearly not right for everyone. To meet the different needs of large organizations, we need an approach that puts the customer – and not a specific cloud platform – at the center of things, a model increasingly known as “multi-cloud”. It’s something enterprise organizations are already thinking about – a recent report by 451 Research and commissioned by VMware and Atos found that 70% of enterprises in the US and Europe plan to use some form of multi or hybrid cloud environment in the next two years.

My colleague Nick Law and VMware’s Ken Audette will be presenting as part of a 451 Research webinar on plotting a new course for digital transformation taking a look at the latest cloud trends over the next three years. To find out more here.

In the next post in this series, we’ll be looking at how global companies step up to the digital transformation challenges of the world economy, international markets and, most importantly, of themselves.

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About Michael Endres
Global Director Product Management Cloud
Michael Endres has almost 20 years of experience in global IT and running programs with business impact. During his career he experienced IT from a variety of perspectives – from SW-Development, Solution Design, Pre-Sales to Product Management and from IT in specific industries like logistics to IT Outsourcing. He also also experienced IT from the Data Center, to End User Computing, to Security to Cloud. His special drive is around innovation creating value for enterprises. Currently Michael is Director, IDM Product & Portfolio Management Cloud.

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