Cloud Computing: Welcoming rain at harvest time

Cloud Computing: Welcoming rain at harvest time

This in-depth feature looks at where cloud computing adoption and development is at in Australia and who stands to benefit

Tending the cloud seeds and nurturing early signs of growth will require channel partners to adopt new business models and skill sets. But the stage is now set for a considerable channel play in the cloud. TREVOR CLARKE reports.

Late last year, IDC came out with the view that 2009 was the year the cloud was seeded. A big call? Yes, as there were – and are – varying levels of understanding in the market and still significant hurdles to achieving a framework definition of the cloud computing trend. The rates of adoption in Australia, while improving, have also yet to hit top gear with many continuing to baulk at large-scale migration. But on the whole, the analyst firm’s view is one that continues to gain traction. There is little doubt the stage has been set for far greater cloud computing use in the coming months and years.

Ever since the economic downturn hit the headlines, IT departments have been stretched by having to continue to provide increasing functionality for line-of-business requests while also reducing costs.

According to IDC surveys, at the top of the priority list for Australian CIOs is spending less on servers and storage, followed by the postponing plans to build or redesign datacentres. The third top priority is investing in consolidation and virtualisation. These priorities, among others, are driving the growing interest in cloud computing. The top reasons CIOs like cloud computing is it is easy and fast to deploy. You also pay only for what you use while still gaining access to the latest functionality.

Already, there are several big players that have gone direct to market and made considerable ground in securing share of early adopters. Google,, Amazon, Microsoft, EMC and more have all heavily pushed their respective solutions straight to the user with success. The email battles across Australia’s universities between Microsoft’s live@edu and Google’s gmail offering, where dozens of clients (many famous institutions) have opted for one side or the other in lucrative and very high-profile direct deals, is but one example.

Hey you, get off my cloud

As a result, and with some legitimacy, channel partners are wary of being left out of the blossoming cloud computing market, a point acknowledged by the vendors.

“As cloud is made up of compute resources plus network access, some of the bigger players do have better access to network resources,” Cisco datacentre practice manager, Dylan Morison, said. “However, clouds come in all different shapes and sizes – the key for smaller players will be differentiation and specialisation, to build their cloud to their strengths. For example, a channel partner with expertise in datacentre and applications could be very successful with a single application based cloud, something the larger players will not be as strong in. “

Clearly, most vendors involved in the cloud push have a financially vested interest in keeping the trend front-of-mind with their partners and continuing to promote its benefits. The opportunity to specialise is one angle often touted – and if you are a forward thinking business owner (i.e. your glass is half full), the argument should resonate.

“Rather than being wary, channel partners should look to their own business models and who they are partnering with, for opportunities to become ‘agents for the cloud’,” VMware partner director, Fred King, said. “There will be many opportunities to provide a vast range of cloud services – partners could consider white labelling and customising specific cloud services to address customers and industries that they have inherent strengths in servicing.”

Additionally, it is understandable that competing against major telecoms providers, which are increasingly revealing serious cloud intentions, like Telstra through its partnership with Microsoft, might be a daunting prospect, Novell technical specialist, Paul Kangro, said.

“In this scenario, it’s important to play to your strengths and offer services and processes that very large players will have trouble competing with,” he added. “For example, move quickly to respond to market needs and provide personalised, customised services for major clients.”

Providentially for the channel, there has been a notable shift in recent times in most of the big vendor approaches to accommodate the scale and innovative qualities a vibrant partner community can offer.

Last year, three out of the biggest four cloud computing players – Microsoft, Google and (with Amazon making rounding out the list) – rolled out far-improved channel cloud programs since they first went to market.

In the US, Microsoft dropped its Windows Azure pricing, Google offered discounts on its Google Apps productivity suite, while launched a program to attract value-added resellers (VARs). Fortunately, all this means the momentum is in the channel’s favour. The challenge now is to clear the hurdles to developing cloud solutions.

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