Wikibon is a professional community solving technology and business problems through an open source sharing of free advisory knowledge. As Cloud Computing matures over the next decade, service providers will take an increasing share of the IT market. Users have needed the support of the IT vendors and have paid premiums for software and services that ensure project success.
Service providers however have a 'coin operated' relationship with their customers, who just pay for what is used. Selling to service providers means creating relationships with large services companies and creating products that will be effective. Action Item: The traditional model of selling to IT organizations will be a declining market. I would suggest that traditional IT and storage vendors are strangling themselves with steady price erosion long before the cloud does.
Created page with 'As cloud computing matures over the next decade, service providers will take an increasing share of the IT market.


IT infrastructure vendors are living off the reality that users always buy more than they really need and under-utilize it. IT is core to a service provider's business, expertise is high and they consume IT equipment in large quantities. Becoming a service provider means changing the product, competing with your traditional sales channel near-term and, increasingly over the next decade, your customers. It would be imprudent to throw away this cash cow, but it will be essential to develop deep relationships with services companies and create a set of service company solutions.
I would just add that becoming a Cloud service provider requires much more than just putting an instance of your software on the Internet. Cloud computing actually represents financial upside as many vendors are entering the cloud as a growth area. Wikibon predicts that over this time, total spending on external IT services will exceed the declining traditional IT budget in most shops. Service providers are astute negotiators and will not pay a premium for software or services.


Either way, the current model of large upfront software costs with big maintenance fees will not be sustainable when dealing with services providers. For vendors who supply to service providers, volumes are high but margins are thin – sometimes very thin.
In general, the philosophy of variabilizing costs will ripple through to software and maintenance models, mandating new ways of pricing and generally changing business practices.
For all vendors the strategic imperative will be to drive down product cost and increase volume.
Several software vendors who have attempted the move to SaaS have found it required a major software rewrite. So vendors should factor that into the equation when deciding whether to become SaaS of IaaS providers.



How to access the cloud storage
How to set up affiliate programs 2014
Become a clubshop rewards affiliate - free gratis


Comments

  1. 09.12.2014 at 18:30:57


    Services?accessed by browser-less devices their business grows.

    Author: Rashadik
  2. 09.12.2014 at 23:49:39


    ?�On-demand-computing') is a type of computing that that the.

    Author: Justin_Timberlake
  3. 09.12.2014 at 16:34:21


    17th consecutive quarter despite beating analyst expectations procedures, you can.

    Author: quneslinec