Although it isn't as popular as the private cloud model, the public cloud is set for big growth.
Public cloud has always been approached with nervousness and skepticism mostly owing to the never-ending issues around security, data protection and tricky SLAs. Even after years of discussions, testing and implementation, this model elicits some degree of brooding.
Solution providers, however, seem to have spotted clear opportunities. More than 25 percent of the respondents of ChannelWorld's State of the Mart 2013 survey wouldn't otherwise reveal their intent to get into this market. While private cloud is considered to be the market where the actual money lies, public cloud seems to be equally promising, especially for tier-2 solution providers.
The reason isn't vague: Public cloud adoption in the country is driven largely by the SMB segment, which has always been a sweetspot for such solution providers. Though the large enterprises are inclined towards private cloud implementations, they do fall back on the public model for certain specific requirements. This makes the public cloud market an interesting space to bet on.
Charting the Right Course
Analysts believe that the market will certainly grow, though the growth rate would remain unchanged as compared to 2012. Biswajeet Mahapatra, Research Director, Gartner, says, "The public cloud market is not going to witness any great change, and the growth rate will remain almost the same. The SMB sector will continue to be the largest driver for this market, especially services industries like education, hospitality, etc." He believes that 2013 will see a lot of custom-made and vertical specific solutions being offered on a public cloud model, which will further propel adoption.
The solution providers on the hand are ready to play their cards right this year. And for serious players, the options are plenty. One can choose to be a cloud broker/consultant, or a cloud service provider or resell a vendor's cloud offerings.
Hyderabad-based Choice Solutions for instance has found multiple profitable models. The SI offers consulting services to its customers who want to migrate to any type of cloud. This required very significant investments to develop the right consulting capabilities and experienced manpower.
At the same time, the company recently decided to try its hand at offering cloud services. To begin with, Choice Solutions will be offering DR and back-up as a service to its existing SMB customers. "We are planning to offer these services only to SMBs initially, because the enterprises have totally different service level expectations. Besides, they are more interested in working with large solution providers. And if we take it to the existing customers, we don't have to rebuild the trust factor. So our idea is to build a sizeable customer base among SMBs, before we move to enterprise class customers," says Jagannath Kallakurchi, CEO and MD, Choice Solutions. In his experience, both consulting and services are far more profitable than product or solution selling, and that's where he sees the future.
For Delhi-based CI Infotech, public cloud is a game-changer. The company is already offering Iaas and various Saas applications to its existing and new customers. Instead of building its own infrastructure, the SI has partnered with a host to offer these services. While most of the Saas offerings are the SI's own IP, CI Infotech is also planning to partner with ISVs to develop more vertical-specific applications.
The SI has an interesting mix of SMBs and enterprises as its customers for the public cloud. "We can't really equate the cloud to something like a dot-com boom, but the market is definitely evolving. Customers, whether it's SMBs or enterprises, want to understand benefits of opex models. And if the observations by industry gurus are anything to go by, we can evidently see a bright future for public cloud," says Irvinder Singh, Director, CI Infotech.
For security experts like Chennai-based Digital Track Solutions, public cloud has always been a great prospective market. After testing the market by offering managed security services to its existing customers, the company is now all set to offer security solutions on pay-as-you-go model. "We will be setting up infrastructure to host the security infrastructure for our customers.
We have seen increasing demand from our existing customers for a service-based model like this," says ST Muneer Ahamed, MD, Digital Track Solutions.
Think Before Moving
Experienced players, however, advise to be watchful about each move. Unlike a product delivery or solution implementation, public cloud is
not likely to give overnight returns and one should have a well thought out blueprint for atleast two to three years.
As a manpower intensive business model, the public cloud calls for extraordinary efforts around developing services capabilities, and above all a service-oriented culture within the organization. One might be required to spend surplus time understanding the overall IT vision of the customer and also in proving your credentials.
"Remember, you are expected to showcase really matured consulting and services capabilities and you will be constantly compared with large players in the industry," says Kallakurchi of Choice Solutions. For a product-oriented company, this means a lot of reshuffle and make-over.