As the big public clouds emerged and really started to grow, enterprises frantically jumped on the cloud infrastructure bandwagon driven by CEO’s and board members who read articles about business transformations from expensive business magazines in the business class seats on transcontinental flights. CEOs could transform their businesses magically and immediately by directing their organizations to go all-in on the public cloud and then they would be the darlings of their industry. Was it too good to be true?
The tail wags the dog
At the same time, solution providers around the world panicked as they initially thought their customers would instantly vanish and their businesses would plummet into oblivion. They acquired or built public cloud consulting practices and they lead with their own cloud-first strategy in an attempt to be the Swiss army knife to their customer base.
Then reality kicked in…
The reality however is that their public cloud practice margins are significantly lower than their traditional business and unless the solution provider is making billion-dollar resource commits on behalf of their installed-based managed customers, the rebate incentives are terribly low. Compounding the margin problem is that the technical resources and skills needed to deliver the low margin public clouds solutions are twice as expensive as the traditional ones used to deploy their traditional infrastructure solutions.
The secret reality
In the paper, The Trillion Dollar Paradox, written by Andreesen Horowitz, the author states, ““You’re crazy if you don’t start in the cloud,” and “you’re crazy if you stay on it”, meaning that even the largest enterprises supported by the smartest MSP organizations are probably paying too much AND struggling to navigate the endless infrastructure complexities presented by the public clouds.
Enterprises are now realizing that while the public cloud is awesome for many workloads, it’s not the Holy Grail of infrastructure transformation that it was initially thought to be, and most are now aggressively trying to find the right middle ground that puts the right workloads in the right locations for the right price. IDC analyzed results from 2,325 end users and found that 71% of respondents expected to move, partially or fully, their workloads currently running in public cloud into a dedicated IT environment in the next two years. With the growing MSP opportunity in finding the right infrastructure for their customers positioned at the right price and at the right location, other significant growth opportunities are also exposed in areas such as ransomware recovery and edge. To learn more about how to recover your customers from ransomware with Nebulon TimeJump, check out our blog, Ransomware: Why it’s inevitable and how to speed up recovery.
What was old is now new again
To quote J.J. Kardwell, CEO at solution provider Vultr, in his recent article, “Big Tech backlash gives rise to the independent cloud“, he states that, “Big Tech casts a long shadow, but the sun is rising over the independent cloud.” Kardwell is correct in stating that the traditionally deployed private cloud has become hot again but this time it has evolved to include many of the benefits, capabilities, and functionalities offered by public clouds but at much lower costs and customized exactly to the needs of the customer. These solutions combined with “white glove” support, real SLA’s and, built in ransomware recovery, allow MSPs to help their enterprise IT customers to still meet their transformation mandate but actually get sleep at night knowing someone trusted is watching over their applications and infrastructure on their behalf.
Get in front of the business opportunity with the extra benefit of ransomware recovery as an included feature
The independent or private cloud market is growing at 31% CAGR and represents a margin rich opportunity for solution providers to grow their customer base while offering modern infrastructure transformation solutions to their customers. Over the next three years, successful solution providers will position themselves to get out in front of the private cloud train by becoming the trusted independent or private cloud infrastructure partner for their customers who can effectively deliver a public cloud operating model via a customized private cloud experience with native ransomware recovery.
To learn more about how Nebulon solutions are enabling solution providers to change their business models and re-think how and where their customers want to consume private cloud infrastructure as a Solution, download our smartIaaS for Cloud Service Providers Use Case and reach out to Stuart Oliver (Stuart at Nebulon.com) to have a real conversation.