By Kirill Bensonoff
It’s a possibly inconvenient truth for some agents: Your customers are migrating to cloud for everything from unified communications to IoT. That’s not just opinion. According to Wikibon and North Bridge and based on analysis of public cloud revenue results from Amazon, Microsoft, Oracle, SAP and IBM, public-cloud spending is expected to grow from $75 billion in 2015 to $522 billion by 2026. That’s a CAGR of 19 percent, and there will be winners and losers (see: Avaya).
More companies are also making money with cloud, that same survey says: Forty-two percent of the 1,351 companies responding derive 50 percent or more of their business through cloud-based applications; 80 percent are getting at least some revenue from the cloud.
This is good news for partners that have the ability to get in at the early stages of the buying cycle and show SMB customers the value of cloud. AWS, Microsoft Azure, Google and hundreds of smaller “as a service” providers want to sell through the channel. If you don’t capitalize, someone else will.
I’ve found that the key is to get yourself in position to help customers make smart and productive choices about cloud. This is what will differentiate you from buying directly from cloud providers, or other channel partners that lack the ability to be business advisers.
Here are seven cloud observations for 2017 that will help you position yourself. Some of them are great business opportunities; some you may have noticed already. But all are important to convey to customers.
- More data breaches are on the way (no surprise there). But what you may not know is that cloud suppliers are responding with improved native logging and auditing for cloud apps that will give security professionals better information without having to rely solely on third-party tools. More info may make cloud-based apps more secure than on-premises systems. Still, the shared-responsibility model used by Microsoft and Amazon means that when you move a customer’s application to the cloud, they or you are still responsible for securing the VM, OS, application and data, as well as network access. As a result, security will continue to be a high priority, especially for mission-critical applications. This means more companies will increase security budgets, creating new opportunities for channel partners.
- Cloud will be seen as risk mitigation strategy. As more CIOs and CISOs get skittish about all those breaches, they will be more likely to delegate security to cloud service providers instead of having to be responsible for maintaining cloud applications in-house. As these leaders move security responsibility to the cloud, it will decrease the risk of mobility as more data and files are stored in the cloud. In a related development …
- Cloud will make or break IT careers. Your CIO contacts are under pressure from multiple fronts; the typical tenure of a CIO is four or five years. CISOs have it even tougher, lasting just 2.1 years, according to Ponemon. IT employees who are quick to adopt cloud security are likely to boost their longevity. As more companies move to cloud, they will need cloud security experts that can weed out the real threats from the background noise. Make sure you’re the one enabling that win-win career growth.
- As hardware dies, companies will continue to move to public cloud despite new angst over long-term TCO. A much-discussed new report from 451 Research finds private clouds based on VMware and Microsoft or OpenStack currently offer a lower TCO than public cloud in some cases, based on scale and labor costs. Still, as hardware reaches end of life, companies will constantly need to make the decision: Purchase new hardware or move processes to the cloud? Partners can help with cost analysis, showing companies how to get immediate time to value using the latest technologies, and offering a third option — virtual appliances.
- Multi-cloud deployments will continue to grow. According to a survey of 314 cloud adopters by Cowen & Co., most public cloud customers use more than one cloud service provider, and over half of respondents say they plan on adding additional cloud vendors. Partners who can act as cloud brokers will be in high demand.
- Cloud vendors will merge to create complete solutions. M&A fever isn’t sparing cloud providers (or the channel, for that matter). As cloud becomes more competitive, providers that have incomplete solutions will be left behind. The ones that thrive will complete their solutions by merging with other vendors. Doing so will reduce the weaknesses of each company. Make sure you’re keeping a scorecard.
- Smart bots will become more common in messaging apps, especially for service and sales applications. Companies are beginning to take advantage of how these bots have increased accuracy in the decision-making process with stronger contextual awareness that allows them to help more customers. These bots will continue to improve in 2017 using cloud, analytics, and customer data, so they can continue making more reliable decisions. Some retailers are starting to use bots for customer support. This trend will continue as more companies use them for basic queries and then deliver more advanced questions to a human representative. Facebook’s Mark Zuckerberg even pitched the idea of bots serving as robotic customer service reps on Messenger.
For additional tips – like how channel partners can increase revenue with IaaS clouds — download Kirill Bensonoff’s new ebook. Kirill is a seasoned entrepreneur and the founder of Unigma, a unified cloud management platform. Unigma has been featured in a number of publications, and Kirill blogs regularly about cloud, tech and growing your managed services business. He can be reached at email@example.com.