Essential Guide

A CIO's guide to cloud risk management

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Will IaaS offerings look radically different by 2016?

In this Ask the Expert, IDC analyst Rick Villars explains why 75% of IaaS provider offerings will be redesigned or phased out over the next year.

IDC predicts that over the next year 75% of  IaaS provider offerings will be redesigned, rebranded or phased out....

IDC analyst Rick Villars offers some examples of providers who are phasing out or morphing their cloud services, explains why they are doing it, and why CIOs need to pay attention to this IaaS evolution.

IBM had a cloud initiative called SmartCloud, and then when it bought SoftLayer, it announced [the company would be phasing out] SmartCloud. So, IBM didn't exit the cloud business, but it did recognize that to get where it wanted to be, rather than trying to evolve its existing environment, it would get a faster start by going out and buying a whole new platform. That's one way it happens.

What we're seeing [with] integrators and resellers who had announced hosted private cloud and public cloud options -- the Accentures and the Logicalises of the world -- many of them have come to the realization now that what they're good at, what their business model's optimized for, is for hosted private cloud. That's the value they bring. So they're saying, 'We're going to focus on what we're good at and where we're optimized; we will partner for other critical cloud options that companies need and we'll provide that orchestration and resource management layer on top of it.' That's the approach that Dell has taken as well.

What's the fallout for providers and customers?

Richard VillarsRichard Villars

In the case of [IBM's] SmartCloud, there wasn't a significant base of customers who were on it, so there wasn't as much risk -- and that's a sign of the early stages of these offerings. [But] there was a cloud storage solution, Nirvanix, where there had been companies who had built significant applications and services on that platform and on very short notice they basically were shut down. I think a lot of people learned a lesson that there is a risk of going with a startup that is not funded or does not have access to funding -- making big bets on that is a high-risk situation.

The second concern is when you have a very large organization that clearly has capital but is opting to exit this space. … Most of them actually aren't exiting; they are basically repositioning the functions that they want to do. [In this case] it's much more about making sure they are developing partnerships to have access to the resource they may now not be delivering in the way they originally promised. The onus is on them to manage the migration and the data movement ... but you need to think about your risk. That's another reason to have a diversified [cloud] strategy -- you are protecting yourself from any one company breaking your service.

About the expert:
Rick Villars is vice president of data center and cloud at IDC and is also a senior member of IDC's IT infrastructure research team, which assesses the development and adoption of solutions for data center transformation and the exploitation of evolving technologies in the areas of big data and cloud. He also develops IDC's viewpoints on the evolution of converged IT infrastructure, as well as the adoption of public and private cloud solutions.

 

This was last published in January 2015

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Essential Guide

A CIO's guide to cloud risk management

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Other major shifts in IaaS space I expect in 2016 will be integration of virtualization and the increased use of Docker containers in the backend.
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There is definitely quite a bit of consolidation or attrition left in the IaaS market, but the trends are well documented by looking at the shifts in the Gartner IaaS MQ for the past few years. 

- Hosting Providers will buy consulting/SI companies
- Large clouds (Azure, AWS, Google, etc.) will add new locations for global coverage
- The mid-sized clouds will need to figure out how to carve a more focused niche (vCloud Air, Digital Ocean, Rackspace)
- The blurring of IaaS/PaaS functionality will accelerate. 

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