On the Verge of Cloud Chaos?

Now that everyone is back from last week’s Mobile World Congress, it is a good time to shift gears to the topic of cloud.

Cloud represents a fundamental shift in how applications and information technology (IT) in general are consumed. It is pretty clear that the market is evolving with many flavors of specialized cloud services coming to market, providing a wealth of choice for the enterprise, small and medium business (SMB), and public sector markets and a range of opportunities for cloud providers (CP’s) to provide differentiated cloud services. These services may address industry or country/province specific functionality or compliance requirements. Cisco refers to this trend as A World of Many Clouds.

As predicted in Cisco’s World of Many Clouds vision, organizations are finding themselves with a wealth of cloud services choices from a multitude of cloud vendors. For example, research conducted by Cisco’s IBSG consulting organization found that SMBs are significantly increasing their spend on SaaS services. Between 2011 and 2013 SMBs between 5 and 249 employees will increase the portion of their IT spend allocated to hosted or subscriptions technology services by 2.6X.Similarly, recent research from Parallels has found that SMB’s used 4 cloud services each on average in 2012 and are predicted to use 7 cloud services each by 2015.

But how do organizations – particularly SMBs — effectively manage what is quickly becoming a multi-cloud environment? Is this wealth of cloud options going to devolve into to a situation of cloud chaos? Fortunately, as the cloud options have proliferated there have also been a range of solutions emerging at different levels of the application stack to help harness the abundance of cloud options: the two primary levels being at the infrastructure level and at the cloud services level.

I’d like to focus first on the cloud services level, and in particular, the emergence of the Cloud Services Brokerage business model as a promising solution to this problem for SMB’s (and a new business opportunity for cloud providers). Cloud Service Brokerage (CSB) is a new business model whereby a firm acts as an aggregator of cloud services – a marketplace if you will – to make cloud services easier to consume for SMB’s. Many industry observers, including several prominent industry analysts, are predicting the rapid growth of the CSB model.

We at Cisco are seeing a substantial interest from cloud service providers in pursuing Cloud Brokerage offerings. The appeal from a cloud provider’s perspective is twofold: it increases the relevance of the cloud provider by providing an easy place for customers to buy a range of cloud services and it provides an incremental revenue stream opportunity for the provider by acting as a channel for additional cloud services.

One CSB enabling software provider with which we have worked closely in a number of successful cloud provider engagements is Parallels. We have plans to integrate our cloud services offerings such as WebEx into the Parallels suite and to provide more seamless integration with our Cisco Intelligent Automation for Cloud (Cisco IAC) cloud orchestration solution to enable cloud providers to get their CSB offerings to market even faster.

I’ll now address quickly the second level of the application stack where a multi-cloud environment can be tied together: the infrastructure level. Sophisticated interoperability at the infrastructure level enables hybrid clouds, defined by NIST as: …two or more distinct cloud infrastructures (private, community, or public) that …are bound together …that enable data and application portability (e.g., cloud bursting for load balancing between clouds). To address this opportunity for sophisticated cloud linkage, Cisco recently announced two new software products – Nexus 1000V InterCloud and Virtual Network Management Center (VNMC ) InterCloud. One of my favorite attributes of these InterCloud offerings is that they work with multiple leading hypervisors, making them more suitable to the messy world of IT which many of us find ourselves in. Keep in mind, that while the NIST definition is the standard, precise definition of a hybrid cloud, I have found many organizations also using the “hybrid cloud” term in a more general fashion — simply to describe some flavor of a multi-cloud environment. For more information on this infrastructure level harmonization of clouds, please see my earlier post.

Well, are we on the verge of cloud chaos? I think not. The rapid development of solutions such as the CSB business model and tools to enable sophisticated hybrid clouds such as InterCloud make me very optimistic on the future of multiple cloud environments in optimizing the delivery of business value.