cloud opportunities for the channel - intel · cloud opportunities for the channel nfobr p ntel pg...

Cloud Opportunities for the ChannelAn IDC InfoBrief sponsored by Intel

An IDC InfoBrief sponsored by Intel Cloud Opportunities for the Channel

pg 2

What Companies Need in an Efficient Cloud Infrastructure

CollaborationServices

Any place, any device,any time, connected to

colleagues

Infrastructure Service Goals

✔ Resilience✔ Security✔ Performance✔ Scalability✔ Collaboration✔ Cost transparency✔ Control assurance✔ Citizenship

HostingServices

FoundationServices

Resilient, scaleable,high performing

infrastructure

SaaSOptimized external application services;

monitoring performance, availability, and support

Service-Centric ITServing internal users

and customer products and services

Infrastructure, incident, problem,capacity, and configuration

management

Efficient cloud infrastructures use cloud service providers and PaaS/SaaS capability as the DNA of the construct-optimized cloud IT organization. They also link the cost of technology directly to the business value delivered, and continue to leverage datacenter-based legacy gear and software that provides value. Efficient infrastructures also re-platform applications, making use of converged appliances and hyperconverged gear to ensure efficiency.


pg 3Source: IDC CloudView Survey, January 2016, n=11,350 respondents, weighted by country by GDP and company size

Nearly 78% of IT Organizations are Using/Planning to Implement Public or Private Clouds

19%

15%

13% 12%

56% 54%

Currently usingFirm plans to implement

Education/evaluatingNo interest

19%

12%

Private cloud Public cloud

51%Have plans to run a mix of public and private clouds

48%Have plans for workload

portability and load-balancing across the Public Cloud and

dedicated resources

Q: How would you best describe your organization’s current or near term plans to use public cloud or private cloud solutions to support production workloads and services?

Building a private cloud is the first step to a more efficient IT operational posture. It’s also the first step to efficient multi-cloud management. Most organizations partner with a channel provider for a roadmap, integration and service management responsibilities.


pg 4

• IT buyers are shifting to a “Cloud also” strategy which endorses Hybrid Cloud architectures

• 53% of Business customers indicate “Shadow IT” is a problem, and more than 65% of Enterprise IT organizations will commit to Hybrid Cloud by 2018

• Proof of concepts are expected within the next 12 months and 40% Hybrid Cloud production took place in 2015

• IT organizations want “liquidity” in some form to source, build, and pay for IT capability. Data Sovereignty and Regulatory Compliance are two of the top three concerns and key criteria for Cloud workloads

Source: IDC FutureScape: Worldwide Cloud 2015 Predictions, IDC, December, 2014

Hybrid Cloud is the Dominant Operational Model

Hybrid Cloud Architecture Consumerization

of Development

Industry Clouds and Data

Trust and Data Sovereignty

Workload-aware

management

Micro IaaS

Cloud Open Source

Continuous Delivery and

DevOps

Managing Risk in IT Sourcing

Skills

Co

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anyw

ide

Mu

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dep

art

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usi

ness

un

its

A s

ing

le

dep

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bu

sin

ess

un

it

0-12 12-24 24+

OR

GA

NIZ

AT

ION

AL

IM

PA

CT

TIME (MONTHS) TO MAINSTREAM

Note: Size of the bubble indicates complexity/cost to address

Company’s hybrid cloud organizational impact and time to mainstream


pg 5

The first step in building private cloud is to act like a scale public cloud provider (SDx). Many IT organizations are reaching the end of the consolidation process. The “Last mile” requires robust SDI infrastructure, conservative VM densities, and end-to-end secure SDN. Greenfield opportunities might be one exception.

The second phase of virtualization is about application portfolio management, elasticity and modularity as well as looking at value in converged/hyperconverged systems.

Source: IDC CloudView Survey, December 2014. n= 3,451 respondents in 17 countries

Building Private Clouds

0% 100%

100%

PE

RC

EN

T A

PP

LIC

AT

ION

S V

IRT

UA

LIZ

ED

PERCENT OF RESPONDENTS

Approximate percentage of company’s entire application portfolio that is virtualized today

25%


pg 6

Cloud “trust” is still in question

Cloud providers don’t want to build large field sales and account management organizations

Cloud providers typically don’t have or want to the infrastructure to provide first call support

Mixed cloud offerings require integrated solutions

Cloud needs more vertical market specialization

End customers need cloud guidance on assembly, SLA, and optimization

Cloud has a confusing array of choices, and its easy to make an expensive mistake

Cloud solutions and services providers are not interested in domain-specific solutions

Partners have “trusted” relationships with end customers

Channel partners have natural reach and local relationships

The Channel is already set up to provide this

Partners are logical sources of integration

Vertical partners know their market’s requirements, regulations, and best practices

Qualified partners will have the necessary professional services capabilities, SLA, “day 1” planning and building and “day 2” training and optimization

Cloud Systems Integrators (SIs) and VARs are trusted partners for sorting out network, platform, and security best practices

As business consulting opportunities increase in cloud, so too does the requirement for domain expertise from the Channel

A Match Made in Heaven Why the Cloud Needs the Channel

The Cloud The Channel


pg 7Source: IDC CloudView Survey, January 2016, n=6,159 respondents from cloud-using organizations, weighted by country by GDP and company size

IT Organizations Have Huge Skills Gaps for Hybrid Cloud Transformation

Q: Which of the following potential characteristics of a “Hybrid Cloud” has your organization adopted?

Subscribing to multiple external cloud services

Using a mix of public cloud services and dedicated assets

IT architecture that unites the configuration/provisioning/management

Supporting portable workloads and automated bursting

Uniting 2+ distinct workloads in an automated configuration

Managing all IT under same service catalog, SLAs, etc...

Currently doing Firm plans Aspiring to Not an area of focus

expect to have consistent service-level monitoring across hybrid-clouds48%

have portable workloads with bursting to IaaS overflow

39%Lack the IT staff skills to use cloud automation tools61%

claim to have a hybrid cloud strategy72.7%

Have not yet implemented a unified service catalog38%

While 72.7% f current cloud users claimed to have a working hybrid cloud policy and strategy: But when measured by the actual skills required they fall short of their self assessment – between 18-37%, in the 6 skills highlighted here. Essentially, most are not ready for fully-operational hybrid cloud operations, because the vast majority of user organizations need assistance to come up to a level of capability. CXOs typically hire 1 or more channel providers to cover their internal skills gaps, and many of these providers - business consultancies, systems integrators, network planners - stay in the role as they help to optimize (performance, expense) their customer’s use of hybrid cloud.

SKILLS GAP18%-37%

SKILLS GAP


pg 8Source: Worldwide Software as a Service and Cloud Software Forecast, 2016-2020, IDC #US40852116, August, 2016

Cloud Software Penetration by Country, 2015

23%3%

Public Cloud Software Penetration (2015)

Worldwide average

17%

23%United States

6%China

15%New Zealand

At the worldwide level, cloud penetration is lower among large organizations than it is among smaller organizations.

But that’s not consistent across all countries. Latin America and some countries in Asia/Pacific have a higher cloud penetration among large organizations than small ones, while US, Canada and Europe have a lower (sometimes much lower) cloud penetration among large organizations than small ones. Larger organizations typically have sunk costs in hardware and software, and IT staff, and frequently have the notion that “we can build it here better.” Smaller organizations have fewer IT assets to amortize and support, and net new functionality is easier for them to buy.


pg 9

What Drives Future Cloud ChoicesNew tools, new delivery choices, & new requirements for IT organizations

Desire for Best Technology Run by Specialists

IT’s mission to build or source based on best available technology.

Strategic acknowledgement from IT organizations that they do not need to

specialize in run-the-business apps.

Cloud-Ready, Fast and Scalable

SDx in the Datacenter

Robust service-orchestration and delivery platforms give IT builders templates for

fast, scalable service centers.

Desire to match IT Expenditure with

Business Performance+/- 90% underutilization of conventional SW creates Disconnect between buyer,

operator, and user of technology.

Traditional ownership model Inadequate for Agility (cost, speed, complexity).

Outcome DrivenEverything aaS

Abstracted technology, subscription, leasing, spot markets, real-time performance, better business-

focused technology.Data is the Driver

Business focus drives cross-industry data-sharing; PaaS platforms create gravity; app. design

becomes data-centric.

It’s all about the Developer

Turnkey text/dev platform and containers over virtualization automate environments, and Dev/OPS put more power in

the hands of developers.

CLOUDS

IT organizations are very eager to turn the common IT work effort “rule of thumb” - 80%/20% upside down, and focus as much effort as possible on innovation, not keeping the lights on. The more they can automate and instrument, the better they are able to serve their internal users and become even more important to their companies.


pg 10Source: IDC CloudView Survey, January 2016, n=11,350 respondents, weighted by country by GDP and company size

Level of Adoption by Organization Size

Private Public SaaS Only

0 10 20 50 100 250 500 1,000 5,000 10K 50K 100K0%

100%

53%

21%

26%16%

10%

75%84%

7%

9%

Q: Describe your organization’s current or near-term plans for each of the following Cloud deployment options.

Larger firms have more complex IT operations and first work to improve them internally. Tasks like portfolio rationalization, replatforming workloads, building mobile front-ends, and scripting access to data can drive more value for their companies. As a consequence they will look to build internal private clouds first, to create a control plane for their multi-cloud efforts. Smaller firms tend to have more of a “greenfield” approach - e.g., “we don’t have a financial planning application - we use Excel.” So subscribing to a financial planning SaaS application makes more sense to them.


pg 11

Big Push for Cloud-Ready Workloads

• Applications with complex processes & transactions

• Highly customized applications

• Not yet virtualized applications

• Mature workloads

• Isolated workloads

• Applications with sensitive data

• Information

• Regulation intensive applications

• Information Intensive applications

• Batch processing

• Archive

• DevOps

• Database workloads

• Disaster recovery

• Collaboration

• Risk and compliance

• Web apps

• Big data and analytics

• Customer service

• eCommerce

• Mobility

• Front office/desktop

• 3rd party apps

• Social business

• ERP/CRM

• High performance computing

• Develoment and test workloads

• Compute workloads

• Business processes

Not ready for cloud

Might be ready

for cloud

Every IT organization feels that what they have customized and built has a distinct advantage to them. Thus every organization has a unique set of application and infrastructure workload services and they will value them differently. Seeking the help of a channel partner or consultant will help them understand utilization, value to the organization, and cost to run. Large firms with thousands of distinct application and data services may find their value is not in the uniqueness of the portfolio, but in being able to provide policy-based access to the best and most-used application services - whether they are built inside the company, or outside.

Ready for cloud


pg 12

Adapting workloads to the cloud means organizations must transform their current platform (re-platform, virtualize, etc...) and leave their workload in place as a private cloud. They also must consider decommissioning if it’s not well utilized and then consider changing to a SaaS version. Alternatively, moving the workload to cloud IaaS hosting.

Organizations must evaluate their needs based first on whether or not their application, report or workload provides a distinct value to justify maintaining it in general, as well as whether or not it provides a distinct value to maintain it on premises (locally).

Depending on that, consider moving applications to a cloud platform and run it remotely and consider using SaaS applications and build a “2-tier” application structure. Choices are made based on the value, utilization, IT skillset, mission-criticality of the applications, and should have a 5-year perspective.

Next Steps for Helping Organizations Adapt Workloads to the Cloud

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